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For Immediate Release: December 17, 2012

LIPA Announces 2013 Operating and 2013/14 Capital Budget

 
No Rate Increase

Maintains Financial Stability While Delivering on Commitments

Uniondale, NY—The Long Island Power Authority (LIPA) today released the 2013 Operating and 2013/2014 Capital budget which includes no rate increase. At a time when Long Islanders are still recovering from the impacts of Hurricane Sandy, the Nor’easter that followed, and an uncertain economy, it is helpful to be able to deliver a budget that holds the line on rates for customers.

The budget continues to maintain the financial stability of LIPA while also delivering on its commitments to deliver safe and reliable service to its customers. The 2013 Operating budget totals $3.597 billion and includes targeted excess revenue over expenses of $75 million.

“We are pleased the Board of Trustees approved an Operating and Capital Budget that does not require any delivery or efficiency and renewable charge increase for next year,” said LIPA Chief Operating Officer Michael D. Hervey.

“Despite the extreme weather damages incurred during Sandy and the Nor’easter we have been able to restrict the overall growth of our Operating and Capital budgets without risking either service reliability or the availability of an adequate and reliable energy supply.”

The 2013 budget is based on sound financial principles and continues to deliver on commitments to reduce peak demand through LIPA’s Efficiency Long Island and Renewables programs. The 2013 budget includes a slight increase to $120 million for the Efficiency Long Island and Renewables programs. The budget reflects investments in cost effective programs that are available for all residential and commercial customers, such as Efficient Products, Cool Homes and the Solar Pioneer and Solar Entrepreneur programs.

The budget meets the commitment LIPA made in 2012 to address future energy needs through a combination of energy efficiency, clean technologies, and renewable projects such as solar, wind, and fuel cells. In addition, it focuses on continued reliability; a robust pole replacement program, underground cable testing and replacement, system reliability enhancements and a new energy management system for transmission and distribution system control. LIPA will also continue to transition to the new business model with the new service provider PSEG starting in 2014, amend the Power Supply Agreement, inaugurate a New Energy /Fuel Management Agreement, and work with our partners to implement the Smart Grid Demonstration Project.

In addition, the Board approved all the necessary storm-related customer service Tariff changes, including the suspension of late payment charges through January 31, 2012 and waiving the daily service charges for metered service customers for 14 days, among others.

While the impact of Hurricane Sandy is not currently reflected in the budget, once the net cost of the storm is determined after Federal Emergency Management Agency (FEMA) reimbursement, LIPA will recommend the appropriate recovery of unreimbursed costs at that time.

LIPA, a non-profit municipal electric provider, owns the retail electric Transmission and Distribution System on Long Island and provides electric service to more than 1.1 million customers in Nassau and Suffolk counties and the Rockaway Peninsula in Queens. LIPA is the 2nd largest municipal electric utility in the nation in terms of electric revenues, 3rd largest in terms of customers served and the 7th largest in terms of electricity delivered. In 2011, LIPA outperformed all other overhead electric utilities in New York State for frequency and duration of service interruptions. LIPA does not provide natural gas service or own any on-island generating assets. More information about LIPA can be found online at http://www.lipower.org.

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