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Con Ed hikes under fire.

The Owners Committee on Electric Rates was set to oppose the second stage of a Con Edison rate rise at hearings this past Monday before the Public Service Commission.

Con Ed had initially filed for a 6.7 percent rise but revised that to 6.5 percent or a $330 million tab.

A deal made one year ago gave the company increases of approximately 18.9 percent over three years. In April, the first increase of 5.1 percent took effect and these hearings would determine the rise for the coming April, 1993 with another increase scheduled for April of 1994. The entire 18.9 percent increase would result in additional payments amounting to $925 million.

While the PSC has given preliminary approval, the increase is being opposed by both the owners committee and Richard M. Kessel, executive director of the State Consumer Protection Board. According to Kessel, the state board "is usually on the other side of the fence." The owners committee represents approximately 100 of the largest owners and managers of commercial properties in New York City.

Associate general counsel for the owners Joel R. Dichter, said he did not think they needed legal grounds to challenge the rates. "The commission has the authority to decide," he noted.

One argument, Dichter siad, is the poor shape of New York's economy. "We're really asking the commission to have Con Ed share in the lean times as well as the fat times,' he noted.

Although the owners brought up this argument last year, Dichter said the economic problems have produced greater rate increases than were thought a year ago.

Kessel and Peter L. DiCapua, president of the Owners Committee on Electric Rates, believe the increases are overstated by more than $360 million compared to rates that would have been determined by traditional rate making procedures. Overcharges, they say, are attributed to surcharges to compensate for lower than expected sales and incentives for conservation management among other items.

An administrative law judge will make a recommendation to the Public Service Commission sometime in the coming weeks and that body will be voting by March on any increase.
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Title Annotation:real estate professionals oppose Consolidated Edison Company of New York Inc.'s rate increases
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:Dec 23, 1992
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