State regulators say they will investigate Eversource rate hikeJuly 30, 2020
The delicate balancing act of anticipating electric demand before and during the COVID-19 pandemic has thrown electricity suppliers, regulators, and customers an unwelcome surprise this summer: massive jumps on electric bills.
The Public Utilities Regulatory Authority had previously approved a rate hike for Eversource that went into effect on July 1. That increase was requested by the utility to recoup costs from the previous year due to electric demand running lower than anticipated. It also accounted for payments associated with a state-mandated power purchase agreement between utilities and the Millstone Power Station.
When regulators approved the rate hike, they did so after Eversource had testified that the average bill for the typical residential customer would only go up by about $5.50 per month.
But then came COVID-19, which meant more people at home using more energy.
“The major increase in customers’ bills has been due to increased consumption,” said James Daly, vice president of energy supply at Eversource. “The change in consumption for our residential customers from May to June increased by 36 percent.”
A spokesperson for ISO-New England, which manages the region’s grid and has issued regular reports on the impact of COVID-19 on electricity demand, said Thursday electricity usage has spiked on hot days in recent weeks.
But overall, the agency said power consumption is down during the pandemic.
ISO said any increases in residential use have, on the whole, been offset by larger decreases in commercial and industrial use.
Daly acknowledged Eversource was seeing similar declines. But he said the company was not shifting costs from declines in the commercial and industrial sector onto the backs of residential customers.
“We don’t shift costs between rate paying categories,” Daly said. “We don’t shift costs towards residential customers because industrial and commercial demand got reduced.”
“I’m not buying the reasons that Eversource is giving us in its entirety,” said Sen. Paul Formica (R-East Lyme).
Formica is a ranking member of the state’s Energy and Technology Committee, which wrote to PURA this week requesting it reevaluate that previously approved rate increase.
“Let’s just revert back to the June pricing. Let’s suspend the rate increase for the moment until PURA has a chance to look at the charges,” Formica said.
PURA has opened an investigation, but wouldn’t say if it has immediate authority to suspend Eversource’s rate increase.
“It’s a really nuanced issue,” said PURA spokesperson Taren O’ Connor in an email. “The July 1st adjustment was an administrative adjustment that, as noted in the order, was always subject to further review and scrutiny by PURA.”
Initially, Eversource officials said spikes in consumer bills were related to a state power purchase agreement with nuclear energy supplier Millstone. That agreement required utilities Eversource and United Illuminating…