Con Edison sought 11.4% electric and 13.3% gas increases for $21B in grid upgrades. Regulators cut it by 87%. What it means for NYC bills and solar owners.
In early 2025, Con Edison asked New York regulators for double-digit rate increases: 11.4% on electric bills and 13.3% on gas. The utility said it needed the money to help fund a $21 billion, three-year plan to upgrade the grid in New York City and Westchester.
The request set off a backlash. Customers packed public hearings, the governor told Con Ed to go back to the drawing board, and regulators ultimately approved a fraction of what the utility wanted.
Here is what Con Ed asked for, what regulators approved, and what the fight means for businesses and solar owners in New York.
What Did Con Edison Ask For?
Con Edison proposed raising electric rates 11.4% and gas rates 13.3% starting January 1, 2026, which would have brought in about $1.6 billion more in electric revenue and $440 million more in gas revenue, according to NY1.
The money was meant to support a $21 billion investment plan for 2026 through 2028. According to the Construction Industry Council of Westchester & Hudson Valley, the plan covered:
- ●Grid modernization. Upgrades to transmission and distribution equipment.
- ●Clean energy. Projects including a clean energy hub in Brooklyn.
- ●New substations. Including a substation complex in eastern Queens.
- ●Affordability and IT. Customer programs and technology systems.
Con Ed said the investments were needed to prepare for extreme weather, rising demand, and New York's clean energy goals.
Why Did the Request Cause Such a Backlash?
New Yorkers already pay some of the highest electricity prices in the country, so a double-digit increase landed on customers who were already stretched. New York households paid an estimated $0.25 per kWh in March 2025, about 48% above the U.S. average, according to the Empire Center.
Governor Kathy Hochul responded in February 2025: "Go back to the drawing board and figure this out, but you're not going to get that kind of rate increase." She directed the Department of Public Service to reject the increases and audit Con Ed's management compensation.
Public hearings drew customers describing how energy costs were already eating into household budgets. For many, the question wasn't whether the grid needed investment. It was who should pay, and how much.
The grid needs investment. The fight is over who pays for it and how fast.
What Did Regulators Finally Approve?
On January 22, 2026, the New York Public Service Commission approved a three-year rate plan that cut Con Ed's first-year electric delivery request by more than $1.37 billion, an 87% reduction.
The approved increases, according to the PSC:
- ●Electric, Year 1. $234 million.
- ●Electric, Year 2. $409.7 million.
- ●Electric, Year 3. $421.1 million.
- ●Gas. $27.5 million, $68.8 million, and $70.3 million over the three years.
The PSC described the result as about a 2.8% annual increase in total electric revenue and 2.0% for gas. The plan supports about $11.7 billion in electric infrastructure and $2.8 billion for gas service.
It also expands outreach for the state's Energy Affordability Program for eligible low-income customers.
Does a Smaller Rate Increase Mean Smaller Grid Upgrades?
Not necessarily, but it means Con Ed has less new revenue to fund its original plan, so some projects may be delayed, resized, or financed differently. The approved plan supports about $14.5 billion in infrastructure, well below the $21 billion Con Ed originally proposed.
That's the core tension. Regulators are trying to protect customers from bill shock while still funding the upgrades a growing, electrifying city needs.
We covered the broader version of this problem in the $186 billion question of who benefits from utility grid spending.
Is Con Edison the Only New York Utility Raising Rates?
No. Utilities across New York have been seeking and winning rate increases. In August 2025, regulators approved a three-year National Grid rate increase worth about $600 a year for the average upstate household.
The pressure comes from the same places everywhere: aging infrastructure, rising demand, extreme weather, and the cost of connecting new resources. The state has also been retiring more generation than it adds.
How Can Businesses Protect Themselves From Rate Increases?
On-site solar, especially paired with storage, can reduce how much power a business buys from the grid and soften the impact of future rate increases.
For New York City businesses, the math is already compelling. We've covered how solar has become NYC's hedge against rate hikes.
The options:
- ●On-site solar. Offsets daytime energy purchases.
- ●Battery storage. Cuts peak demand charges and adds backup power.
- ●Community solar. Bill credits for businesses that can't host panels.
- ●Efficiency upgrades. Lower consumption reduces exposure to every rate increase.
Distributed storage is growing fast in other markets. Sunrun reported 70% of its new customers adding batteries, driven largely by rate design that rewards storing power for peak hours.
What Does This Mean for Existing Solar Owners?
Every rate increase makes the power a working solar system produces more valuable, because it offsets electricity that keeps getting more expensive.
But many commercial systems in New York were installed in the 2010s and are now losing output to aging inverters or degraded panels. A system producing less than it should is leaving more money on the table with each rate increase.
Repowering an aging PV system can restore that output using the site and grid connection already in place.
Start With a Ballpark Estimate
Rates in New York are still rising, even after regulators trimmed Con Ed's request. Find out what your existing solar project may be worth before deciding whether to repair, repower, or sell.
Sources: Bloomberg, "New York Power-Bill Backlash Threatens Con Edison's Climate Goals"; NY1, "Con Edison proposes double-digit rate hike for 2026"; CICBCA, "ConEd's Plan for $21B Upgrades Draws Gov.'s Criticism"; NY Public Service Commission, January 22, 2026; Empire Center, "Albany's Looming Energy Shock"
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