Skyrocketing utility costs will lead to more inflation
A COLUMN by NY State Senator Tom O’Mara
Moving into the second week without a new state budget in place, we’re continuing the fight to keep attention focused on the No. 1 issue facing many of our constituents at the moment: skyrocketing utility costs.
In recent days, the Senate Republican Conference sent a letter to Governor Hochul calling on her to demand the inclusion of ratepayer relief legislation in this year’s final state budget. New York governors wield enormous power within the state budget adoption process. If the governor is as serious as she’s claiming to be about addressing the shortcomings of the “Climate Leadership and Community Protection Act” (CLCPA), enacted by Albany Democrats in 2019, there are steps that need to be taken.
From our recent letter to the governor, “Since you became Governor in 2021, $88.7 billion has been invested in clean energy programs with the funding mainly paid by ratepayers on their utility bills. The arrears numbers indicate that ratepayer funding has reached its capacity. Immediate relief needs to be made available to ratepayers. The energy transition needs to move forward with reasonable and achievable goals that are affordable. The ratepayer cannot bear the whole burden.”
Under legislation (S8461) I sponsor, for example, Governor Hochul could immediately provide at least $3 billion in bill credits to ratepayers using unspent funds collected from ratepayers in the form of surcharges, mostly hidden, on utility bills by the New York State Energy Research and Development Authority (NYSERDA), with state Public Service Commission (PSC) approval, for green energy projects.
It’s critical to remember that under the current CLCPA, a significant portion of the money underpinning the Democrat climate agenda comes from state-imposed surcharges on every ratepayer’s utility bill. That’s right, if you’re a ratepayer, you’re directly footing the bill for the CLCPA and, it seems to many of us, you should have had a more direct say in whether you agreed with being forced to pay for the imposition of the CLCPA timelines and mandates. Instead, Albany Democrats left those decisions up to state bureaucrats, washing their hands of future consequences and hoping to avoid any political fallout down the road.
NYSERDA’s most recent financial plan revealed that the authority had more than $2 billion of these unspent ratepayer funds at the end of 2025. An additional $770 million was being held in escrow by utilities. These unspent funds should be returned to ratepayers to provide immediate ratepayer relief and, furthermore, we should immediately rethink whether the state should be relying on ratepayers at all to fund what’s become, at best, questionable energy policy.
As I noted in this column not long ago, when the CLCPA was first approved and during the nearly seven years that have transpired since then, state Democrats who champion the CLCPA failed to put forth a financial impact statement for the law until a few weeks ago, when the Hochul administration finally released a NYSERDA memo outlining the “likely costs of CLCPA compliance.”
That memo reads, in part, “Absent changes, by 2031, the impact of CLCPA on the price of gasoline could reach or exceed $2.23/gallon on top of current prices at that time; the cost for an MMBtu of natural gas $16.96; and comparable increases to other fuels. Upstate oil and natural gas households would see costs in excess of $4,000 a year.”
The memo continues: “Likewise, similarly burdensome costs should be anticipated for small and medium commercial businesses. Depending on the utility and size of the facility, such entities could expect utility costs to increase by as much as 46%. Costs for operating a delivery truck would increase by over 60%.”
Bottom line? These costs will lead to increased prices for virtually every good and service for all of us.
This year’s final budget should also include a second piece of legislation (S8463), which I co-sponsor, to establish a one-year utility bill tax and surcharge holiday and a two-year green energy gas tax holiday, which would provide immediate and meaningful relief to ratepayers paying residential electric rates 50% higher than the national average.
Senate Republicans also recently forced a vote on the Senate floor on an amendment that, if it had been approved, would have delayed one of the most onerous mandates currently in the CLCPA pipeline, the all-electric school bus mandate looming as the largest-ever unfunded mandate on school districts and local taxpayers. It would have also required a study to determine if it’s even remotely workable before forcing school districts and local taxpayers to figure out how to afford it. Our amendment was unanimously rejected by the Senate Democrat majority.
Throughout the 2026 legislative session, in fact, our conference has repeatedly offered alternative plans and proposals that we believe are more focused on affordability, feasibility, and reliability, and which, if enacted, would better protect ratepayers from what they’re facing now.
It’s irresponsible for New York State to go on asking ratepayers to bear the burden of a strategy that’s not working, and that won’t work as it stands.
