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Revenue Decoupling

The new Revenue Decoupling Adjustment (RDA) on your bill is not as intimidating as it sounds. Let us explain...

Revenue Decoupling is not unique to PSEG Long Island
Revenue Decoupling is used in many other states and has already been in use by every other major utility in New York State. The New York State Department of Public Service (DPS) recommended to LIPA that Revenue Decoupling be adopted here and it was approved by the LIPA Board of Trustees in 2015.

PSEG Long Island encourages you to use less of our product
Most companies collect revenue by getting you to buy as much of their products as they can. Every time you flip on your lights or the TV, you’re buying our product – electricity. But one of our main goals is to help you use less electricity.

That creates an issue: selling less electricity creates less revenue. And without enough revenue, we would not be able to deliver reliable electric service and quality customer service for millions of people and thousands of companies from Queens to Montauk, 24 hours a day, 7 days a week.

The money that’s required each year in order to provide our services to you is outlined in our annual budget. That budgeted revenue, which is authorized by LIPA, is then compared with the actual revenue collected from electric rates. The difference between actual revenues and budgeted revenues creates the Revenue Decoupling Adjustment.

Encouraging energy savings
By separating – or “decoupling” – rate revenue from the amount of energy used by customers, utility budgets are less dependent on selling energy. That removes a major obstacle that could otherwise stand in the way of supporting energy efficiency.

The RDA adjusts bills based on how actual revenue compares to budgeted revenue. Any excess revenue is refunded to customers as a credit adjustment. If revenue falls short, the RDA is a charge to ensure enough funds are available for us to continue to deliver reliable service.

The RDA does not increase our profits
PSEG Long Island earns money from a flat fee for managing the electric system. We do not earn even a penny from the RDA. Every dollar of revenue collected from electric rates is used to run the system and invest in reliability improvements.

You have the power to save
Rest assured that if the RDA is a charge, you still have an incentive to reduce your bill by using less electricity. Our responsibility is to provide programs and resources that make it easier for you to save energy and money. We encourage you to take advantage of these opportunities. Even simple changes in behavior like turning off the lights when you leave a room can save. Or explore our rebate programs that reduce the cost of energy efficient appliances and products.


Every revenue dollar collected is used to benefit customers – for the services we provide today and investments that will make the electric system stronger and more reliable tomorrow.


Frequently Asked Questions


Last Updated 03/14/2016 12:07 PM