01—Abstract
Summary
Summary of the 8-K filed November 5, 2025. Cited figures are marked; the original filing is the authoritative source.
Consolidated Edison's utility subsidiary, CECONY, has reached a Joint Proposal with the New York State Department of Public Service and other parties for new electric and gas rate plans covering January 2026 through December 2028.
The agreement is not final and remains subject to approval by the New York State Public Service Commission (NYSPSC). Under the proposal, electric base rate changes are $222 milliona, $473 million, and $329 million in Years 1 through 3, and gas base rate changes are $(46) million, $170 million, and $93 million. The company will implement these on a shaped basis, producing consistent total bill impacts of 2.80% per year for electric and 2.01% per year for gas.
The plan includes a 9.40% authorized return on common equity, a 48% common equity ratio, and roughly $17 billionb of combined electric and gas capital investment over the three years. Relative to CECONY's January 2025 filing, which requested a $1.6 billion electric increase and a $441 million gas increase, the Joint Proposal is substantially lower. It also compares favorably with staff and intervenor testimony, which proposed a 9.30% ROE.
The plan includes a $75 millionc annual retention of transmission congestion revenues on the electric side and up to $65 million of annual non-firm gas revenue retention. Investors should note that the plan carries meaningful contingent exposure: potential negative revenue adjustments tied to service, reliability, and safety performance could reach $653 million to $745 million annually on the electric side and $133 million to $149 million on the gas side, partly offset by possible gas offsetting credit adjustments of $12 million to $14 million per year. Earnings above a 9.90% threshold are largely directed to reducing regulatory assets, which caps upside.
The filing is a regulatory milestone that provides earnings visibility through 2028 and supports rate base growth, with average electric rate base rising from $32.9 billion in Year 1 to $39.2 billiond in Year 3. Final outcomes depend on NYSPSC approval, which could modify terms. Con Edison has also indicated it will update its forecast through 2030 in February 2026.
02—Key points
Key Highlights
- Three-year electric and gas rate plan (January 2026 to December 2028) agreed in a Joint Proposal with NYSDPS and other parties, subject to NYSPSC approval.
- Electric base rate changes of $222M, $473M, and $329M (Years 1 to 3); gas base rate changes of $(46)M, $170M, and $93M, implemented on a shaped basis with consistent total bill impacts of 2.80% (electric) and 2.01% (gas) per year.
- Authorized ROE of 9.40% and 48% common equity ratio, versus the 10.10% requested in the January 2025 filing and the 9.30% recommended in staff and intervenor testimony.
- Approximately $17 billion of combined electric and gas capital investment over three years, including electric capex of $4.55B, $4.47B, and $4.71B and gas capex of $1.09B, $1.06B, and $1.07B.
- Average electric rate base grows from $32.9B (Year 1) to $39.2B (Year 3), and gas rate base from $11.5B to $12.6B, supporting long-term earnings growth.
- Significant contingent exposure: potential negative revenue adjustments of up to $653M to $745M per year (electric) and $133M to $149M per year (gas) if service, reliability, and safety targets are missed.
- Earnings above a 9.90% threshold are largely applied to reduce regulatory assets, limiting upside, and the plan retains $75M of annual electric transmission congestion revenues and up to $65M of non-firm gas revenues.
03—Questions
Frequently Asked Questions
What is the Joint Proposal, and when does it take effect?
The Joint Proposal is a settlement between CECONY, the NYSDPS, and other parties setting electric and gas rate plans for January 2026 through December 2028. It is not yet effective; it requires NYSPSC approval, and new shaped rates will begin billing only after approval, with a surcharge (including carrying charges) to recover any timing shortfall.
How does the proposed ROE compare with what CECONY originally requested?
CECONY requested a 10.10% ROE in its January 2025 filing, updated to 10.00% in April 2025. The Joint Proposal sets the authorized ROE at 9.40% for both electric and gas, with a 48% equity ratio. This is a meaningful reduction, though it is above the 9.30% recommended by staff and intervenor testimony.
What financial risks or limits in the plan should investors watch?
Investors should watch the potential negative revenue adjustments, which could total $653M to $745M annually for electric and $133M to $149M annually for gas if performance targets are not met. Earnings above 9.90% are largely used to reduce regulatory assets, capping excess returns. Additional items include deferral mechanisms for uncollectibles, property taxes, and municipal infrastructure costs, and an ongoing NYSDPS audit of income tax accounting.
Why do the headline rate increases differ from the shaped bill impacts?
The headline base rate changes ($222M electric and $(46)M gas in Year 1) are shaped over the rate plan so that customer total bills rise by a consistent percentage each year (2.80% electric and 2.01% gas). Shaped base rate increases are $234M (electric) and $28M (gas) in Year 1, with later years also adjusted, so the annual amounts differ from the headline figures.
How much capital will be invested, and what does it mean for growth?
The plan supports nearly $17 billion of electric and gas investment over three years. Electric capex totals about $13.7 billion and gas about $3.2 billion. Rising average rate base (electric from $32.9B to $39.2B, gas from $11.5B to $12.6B) is the primary driver of future earnings growth, provided the NYSPSC approves the plan substantially as proposed.
04—Continue