Con Edison Bills to Disclose NYC Property Tax Impact on Rates

Con Edison is set to begin itemizing a significant component of its customer bills: New York City property taxes. The utility stated that approximately 21% of a customer's monthly bill directly covers Con Edison's property tax obligations to the city, which amounted to $2.6 billion last year, making it the largest taxpayer in New York City. When other state taxes and fees are factored in, this portion can climb to about 30% of the total bill.

Con Edison's property tax payments have seen a substantial increase, rising by 45% between 2019 and 2024. This trend is outpacing inflation and other components of customer bills. The utility argues that customers should be aware of the direct impact these taxes have on their energy costs.

"Our goal is to help customers understand how much of their bill is going to support other things — schools, police, fire, all the things that municipalities use their tax revenue for — and to really open a conversation about whether the utility bill is the right place to be raising those funds," said Jen Hensley, Con Edison Senior Vice President of Corporate Affairs. She noted that the 45% increase in property taxes over five years far outpaces inflation and other bill components.

Critics, including former state utility regulator John Howard, have described the property taxes imposed on Con Edison customers as excessive and regressive, disproportionately affecting lower-income individuals and small businesses. He highlighted that this practice is unusual for municipalities in New York State and that the cost is hidden within the utility bill.

This new disclosure is part of a settlement approved by the New York State Public Service Commission (PSC), which also authorized Con Edison to increase electric and gas rates. The PSC allowed a 10.4% increase in electric bills and a 15.8% increase in gas bills over three years, potentially costing the average New York City resident an additional $600 annually by 2028.

City Hall, however, has voiced concerns about the transparency of Con Edison's billing practices. A spokesperson for the mayor's office stated that if Con Edison is to include property tax costs, it should also itemize shareholder profits and other taxes. The city also suggested that state officials bear some responsibility for the rising property taxes, pointing to PSC approvals of increased capital spending by Con Edison, which inflated the value of its taxable real property. Much of Con Edison's infrastructure, such as poles, wires, and pipes, is assessed by New York State, and its property taxes have increased due to surging state assessments, not changes in city tax rates.

Con Edison maintains that its infrastructure, including pipes and wires, is taxed differently and at a higher rate than comparable commercial properties. The company stated that the 21% of customer bills allocated to property taxes is nearly double the average of 12% seen at other utility companies nationally. This disparity, Con Edison argues, means its customers face uniquely high tax-driven charges not encountered by ratepayers in other regions. The utility also noted that these tax charges are fixed components of delivery rates, leaving customers unable to reduce them.

An independent study indicated that from 2019 to 2024, Con Edison's operating expenses rose by 27%, while its tax burden increased by over 36%, contributing to a growing proportion of the monthly bill. The company also pointed to a cap on annual property tax assessments for residential properties, which has shifted a greater tax burden onto utilities like Con Edison. The company has advocated for reforms in Albany to reduce customer tax burdens, including seeking property tax exemptions for clean energy infrastructure investments.