New York Commission Approves Rules for Compensation Related to Service Outages

The New York State Public Service Commission has adopted new rules requiring certain energy distribution companies to compensate residential and small business consumers who have suffered widespread and prolonged service outages. The decision enables consumers to get reimbursement in the event of extensive service outages lasting longer than three days. This ensures that utilities do their best to restore services as quickly as possible.

The rule implements a provision of the public service law, effective April 21, requiring electric and gas companies to compensate consumers experiencing prolonged electric or gas service outages. Major companies to be impacted by the new law include Orange and Rockland Utilities Inc., Valley Energy Inc., Consolidated Edison Company of New York Inc., National Grid, New York State Electric & Gas Corp., Rochester Gas and Electric Corp., National Fuel Gas Distribution Corp., Corning Natural Gas Corp., and Liberty Utilities.

According to the new law, the companies are expected to reimburse up to $540 to customers on each proof of loss, $235 for an itemized list, and $25 for each 24-hour period of service outage that occurs for more than 72 consecutive hours. The utilities are expected to reimburse up to $540 to small business owners for food spoiled with valid proof of loss. All damages must be claimed within 14 days of the outage, and companies must reimburse within 30 days of receiving the claim. However, utility companies cannot recover any costs incurred for compliance activities.

In a separate decision, the commission addressed the application of the law to outages in the service territory of New York State Electric and Gas following outages caused by a snowstorm on April 18 before the law took effect. The commission found that the 72-hour outage period, which must pass to implement the reimbursement requirement, started on the effective date and would have concluded on April 23. The utility recognized the inconvenience caused due to prolonged outages and agreed to provide $25 credits to 569 consumers.

As a part of the new rules, the commission is empowered to circulate procedures, standards, and methodologies, and to outline specific terms and conditions, including continued outage.