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National Grid proposes hefty rate hike for NYC and Long Island natural gas users

National Grid proposes hefty rate hike for 2024
National Grid proposes hefty rate hike for 2024 02:31

NEW YORK -- Homeowners beware: National Grid is proposing a hefty increase in natural gas bills for next year.

It impacts roughly two million customers living in New York City and on Long Island. 

CBS New York's John Dias looked into why it's happening and what you can do to lessen the blow.

Among its many uses, natural gas is used to heat homes. But soon it could be burning a hole in your pocket.

If the rate hike is approved, the average bill for city residents would increase nearly 17% or almost $31 more a month. For Long Island households, a 16% jump would equate to around $28 more each month.

As expected, homeowners who rely on natural gas are not pleased.

"I think that's outrageous," Plainview resident Jane Wilson said. "Everything right now is very, very expensive, so it would really be a burden for us."

National Grid blames inflation and government green energy requirements, saying in a statement, "This proposal demonstrates our commitment to reducing emissions, promoting electrification, and decarbonizing the gas network."

But the sizeable spike has economic experts scratching their heads, especially since numbers show National Grid's profit margins are strong.

"I don't think it is normal," said Martin Melkonian, adjunct associate professor of economics at Hofstra University. "They're doing pretty well, they've shown nice growth over the years, they've just increased their dividend by 4%."

While natural gas is a fossil fuel, the global emissions from burning it are much lower than coal or oil and usually cost less.

Republican New York State Sen. Anthony Palumbo, who represents a large portion of Long Island and is part of the Environmental Conservation Committee, says raising the cost of natural gas may deter people from wanting the greener option. 

"It's counterintuitive to what is good environmental policy," he said. "If we are going to reduce our carbon footprint, let's reduce it by eight times by going from oil to gas and then let's reduce it to zero by going from gas to wholly renewable."

Dias asked whether there's a solution.

"The solution would be, one, keep an eye on them and make sure they're doing it fairly and properly, and, two, put some money on it," he replied.

Palumbo says New York State should subsidize some of the costs for natural gas users, but that could take away from other funding.

The state Public Service Commission will hold public hearings before voting. If approved, the proposed rate hikes would take effect on April 1, 2024.

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