Opinion: Utilities count on your boredom to keep electric bills high
Want to know the quickest way to clear a party? Start talking about utility regulation. First, the record scratches, eyes glaze over, conversations die, and suddenly everyone remembers they need to check on their pets. It’s regulatory Kryptonite … so mind-numbingly technical that even policy wonks reach for their phones.
And that’s exactly how utilities like it.
Maybe you’ve seen and promptly forgotten a confusing and uninteresting public notice about “Performance-Based Regulation (PBR) implementation frameworks.” Well, the companies sending you those painful monthly electric bills don’t think those frameworks are boring — and they are busy trying to shape a system they hope will lock in their profits for years to come. They’re betting millions of your dollars that this is all so impenetrable that you’ll leave the decision-making to them.
Connecticut rate-payers face some of the highest electricity costs in the nation. Yet when the Public Utilities Regulatory Authority (“PURA”) opens regulatory cases about fundamentally restructuring how our utilities get paid, proceedings that could determine whether your bills go up or down for the next decade, the hearing rooms are practically empty … except for utility lawyers, of course (and a few advocates like us).
The great regulatory reveal
Here’s what’s happening behind all the technical jargon: Connecticut is considering revising the way utilities make a profit to incentivize them to spend less money (or at least spend it more where it counts). Instead of the traditional model where utilities get paid based on how much of your money they spend (yes, you read that right — they literally make profit from spending your money), performance-based regulation ties their compensation to actual, specific results.
Right now, utilities in Connecticut (and across most of the country) operate under what’s called a “cost-plus” model. They spend money on grid infrastructure — think wires, poles, and substations — then get to charge you for it, plus a guaranteed profit margin. It’s like someone giving you a credit card and promising they’ll pay your bill and give you a 10% tip on whatever you spend, regardless of what you buy or how much it costs. Who wouldn’t max out that card?
Performance-based regulation flips this script. Instead of rewarding utilities for spending, it rewards them for delivering actual value: reliable service, faster storm restoration, meeting clean energy goals, and, crucially, keeping costs reasonable.
If this idea sounds obvious, that’s because every company that isn’t a monopoly utility makes a profit when it delivers value. It’s what a competitive market yields naturally.
Why ‘it’ll never work’ is the real problem
The real barrier isn’t technical – it is psychological. We’ve become too comfortable accepting a system that doesn’t work for anyone except utilities. For too long, the energy sector has operated under the assumption that monopolistic structures and guaranteed profits are just how things have to be, as if sky-high electric bills and utility monopolies are like gravity — natural laws we have to accept, rather than policy choices we can change.
This comfort with dysfunction has real costs. While we’ve debated incremental tweaks around the edges, utilities have continued collecting guaranteed returns regardless of performance, and ratepayers have continued footing the bill for inefficiency. The longer we accept “that’s just how it has always been done” as a valid response to systemic problems, the more entrenched these issues become.
But those of us who came of age watching entire industries transform overnight know better.
We’re the voice that refuses to accept “that’s just how it’s always been done” as a valid answer to systemic problems. We’ve seen Uber disrupt taxis, Netflix kill Blockbuster, and solar prices plummet by 90% in a decade. For us, it’s obvious: industries only seem “unchangeable” until they change completely.
The truth is, resistance to change has become the energy sector’s most expensive luxury and ratepayers — all of us who depend on electricity — are footing the bill. But we don’t have to be paying for nothing to change, and we shouldn’t be. When incumbents shrug off innovative regulatory approaches, they’re not making a prediction; they’re making a choice: to protect a system that keeps utility profits sky high (and growing!) while everyone else pays through the nose.
What’s really at stake
Performance-based regulation isn’t just regulatory housekeeping. Done right, it could be the key to breaking Connecticut’s cycle of ever-increasing electric bills. Done wrong, it could lock in the current system where utility shareholders get richer while ratepayers get poorer. The grid will require significant investment in the coming decades, of course, so it is vital that the public’s money be invested as prudently as possible.
Literally, only utilities are happy with increases in electric and gas bills right now. Families are choosing between air conditioning and groceries. Small businesses are closing because they can’t afford to pay their electric bills. So why aren’t we throwing everything we have at fixing this problem?
The framework being developed now will determine whether your utility gets rewarded for efficiency or excess, for innovation or inertia, for serving customers or enriching shareholders. This is the rare regulatory moment where the wonky details will make a big difference to your wallet and your future.
Time to crash the party
The window for action is opening: PURA is expected to issue their proposed final decisions in the PBR proceeding this July. Organizations such as Vote Solar, Acadia Center, and a growing coalition of advocates are fighting for performance standards that matter and translating gate-keeping utility-speak into plain English so you can join the fight.
We’re demanding that any new regulatory framework serves the people paying the bills, not just the companies sending them. We’re fighting for faster power restoration after storms, real progress on clean energy goals, and incentives for utilities to keep your bills affordable for you rather than profitable for them.
But your electric bill depends on someone showing up who represents your interests. The utilities are certainly showing up … and they have teams of lawyers that your money pays for whose job is to protect their interests, not your pocketbook.
Luckily, PURA provides equitable opportunities for advocates and rate-payers to weigh in on these critical decisions. Keep your eyes open for ways to get involved when these decisions drop. Whether that means submitting comments supporting provisions to lower your bills or voicing concerns about proposals designed more for utility shareholders than rate-payers, your input matters. It may seem like it doesn’t, but we promise: it actually does.
Younger generations will be the ones living with the consequences of today’s energy decisions. Climate change isn’t a distant threat for us — it’s the backdrop of our entire adult lives. Energy affordability isn’t an abstract policy debate either — it can be the difference between saving for a house or paying rent forever.
Connecticut rate-payers deserve a voice in how their utilities get regulated and compensated. Don’t let the utilities’ strategy of “boredom-by-design” win by default, especially when PURA is actively creating space for you to be heard.
Your future electric bills are counting on it. Because the most expensive conversation is the one you’re not part of.
To read this article from CT Post, click here.
Electricity demand is on the rise in Maine. Should nuclear power be a part of the energy mix?
The remains of the Maine Yankee nuclear plant in Wiscasset are protected by a tall chain link fence topped with razor wire and a checkpoint manned by armed guards.
About a quarter of New England’s electricity comes from nuclear reactors in New Hampshire and Connecticut.
But Jamie Dickerson, senior director of climate and clean energy programs at the Acadia Center, doubts nuclear will make significant inroads in the region.
“Most of the modeling that we have reviewed largely suggests a future where solar, wind and batteries are really dominating the generating resource mix well into the future,” Dickerson said.
Even as New England states see prospects to rapidly build out offshore wind resources in the face of market forces and political obstruction, Dickerson still thinks nuclear will complement, not displace, renewable generation.
To read the full article from Maine Public, click here.
Massachusetts could give heat pump owners a huge discount on electricity
Massachusetts regulators are considering a plan to make heat pumps an obvious financial choice for most residents.
The state Department of Public Utilities is mulling a proposal to heavily discount electricity rates in the winter months for households with heat pumps, a move that could cut energy bills for more than 80% of residents who switch over to the efficient, electric appliance from fossil-fueled or electric resistance heating. For many of those households, the savings would amount to hundreds or even thousands of dollars each winter.
Supporters of seasonal heat pump rates stress that the lower prices do not mean that heat pump users are being subsidized by everyone else. In fact, they say, the proposed rate structure is far more fair than the status quo.
“This is not a handout to heat pump owners,” said Kyle Murray, director of state program implementation for clean-energy nonprofit Acadia Center. “This is a fundamental issue of fairness.”
Here’s why: The delivery portion of an electricity bill pays for the construction and upkeep of the poles, wires, and other infrastructure needed to get power where it’s going. To determine how much to charge customers — and this is a bit of a simplification — the utility divides the total cost by the number of kilowatt-hours it expects customers to use. That number becomes the delivery rate.
To read the article from Canary Media, click here.
Report: Adopting heat pumps in Mass. is an issue of fairness
SPRINGFIELD — There’s a way for Massachusetts residents to reduce the costs of electricity while the state works to achieve its climate goals: widespread adoption of air-source heat pumps.
That’s according to a new report from Switchbox, a New York climate policy think tank.
The fund was one of a few organizations that commissioned Switchbox’s report. The others include Green Energy Consumers Alliance in Boston; Acadia Center in Hartford, Connecticut; ZeroCarbonMA, a statewide coalition; and Rewiring America, a national group.
“They actually aren’t incurring any more stress upon the grid or the system than than their non-heat pump counterparts,” said Kyle Murray, state program implementation director at Acadia Center in Connecticut. Despite this, heat pump customers are charged more than double for the delivery of electricity, the report said.
Murray, of Acadia Center, said ratepayers should only be charged for the amount of energy they incur.
“This is a fundamental issue of fairness at the end of the day,” he said.
To read the full article from Mass Live, click here.
New Report: Massachusetts households poised for more than $600 in median savings with heat pump upgrades under proposed rates
BOSTON – A new report shows that 82% of MA households can save an average of $687 each winter by upgrading to high-efficiency heat pumps if the Massachusetts Department of Public Utilities (DPU) adopts proposed rate changes from the Massachusetts Department of Energy Resources (DOER). The findings show that the proposed rates would help correct an existing imbalance in which current heat pump users are unfairly subsidizing other electric ratepayers.
The report, Heat Pump Rates in Massachusetts, was developed by Switchbox and sponsored by Environmental Defense Fund, Acadia Center, Rewiring America, Green Energy Consumers Alliance, and ZeroCarbonMA. The analysis highlights how Under DOER’s proposed rates, most electric customers of National Grid, Eversource, and Unitil would save money by switching to heat pumps, including single-family homeowners and customers who heat with methane gas.
“This report makes clear that fairer electric rates are key to unlocking the full potential of clean heating,” said Kyle Murray, Director, State Program Implementation and Massachusetts Program Director for Acadia Center. “The proposed heat pump rates level the playing field, correcting outdated price structures and delivering real savings for households. This isn’t just about savings for individual households, smarter rates strengthen the grid, support a cleaner economy and move us closer to our climate goals.”
To read the full press release from Environmental Defense Fund, click here.
Report Details Cost Savings of Heat Pump Rates for Mass. Consumers
Strong winter discounts on electricity delivery rates are needed to more fairly charge Massachusetts homes with heat pumps for their share of grid costs, according to a new report commissioned by a coalition of environmental groups.
In December, an interagency working group recommended that the DPU require the utilities to establish more aggressive winter heat pump discounts. (See Mass. Electricity Rates Working Group Issues Recommendations.)
Under this updated discount, houses with heat pumps would pay roughly the same delivery costs as those heated by gas during the heating season. Supply costs would not be affected by the discount, and heat pumps would still pay for their full supply costs throughout the year.
Kyle Murray, director of state program implementation at the Acadia Center, emphasized that heat pump rates do not represent a “handout to heat pump owners.”
“Even though heat pump owners are using more energy than their non-heat pump counterparts, they’re not actually causing more stress on the system,” Murray said. “Heat pump rates just simply represent fairness in ratemaking.”
To read the full article from RTO Insider, click here.
Renewables Helped Prevent Blackouts on New England’s Hottest Day This Summer
Renewable energy sources, such as solar power and battery storage, have helped keep power on in New England, even during peak demand on the hottest day of summer.
According to a recent report from the nonprofit Acadia Center, more than 5 gigawatts of behind-the-meter solar provided additional support during peak demand times, despite the temperature in New England exceeding 100 degrees Fahrenheit on June 24.
ISO New England, a grid operator, issued a Power Caution on June 24 due to the heat, and that evening, peak energy demand reached 26,024 MWh, the highest peak since 2013.
Based on Acadia Center’s findings, as much as 22% of power usage in New England on June 24 came from behind-the-meter solar.
Thanks to residential solar, customers did not have to face energy blackouts and even saved money on skyrocketing electricity prices during the heat wave. The report from Acadia Center noted that while wholesale electricity prices reached more than $1,000 per megawatt-hour (MWh), customers with behind-the-meter solar saved more than $8.2 million collectively. This estimate may even be much lower than reality, with Acadia Center explaining that behind-the-meter solar may have saved customers $19.4 million in energy costs on June 24 alone.
“Solar was helping not just deliver megawatt-hours but also suppressing demand for the entire region,” Jamie Dickerson, senior director of clean energy and climate programs at Acadia Center, said in a statement. “Basically helping ensure that the grid could keep the lights on, could keep the air conditioning running.”
But total energy and cost savings were likely even higher thanks to other clean energy improvements, such as battery storage and higher energy efficiency. According to Acadia Center, energy efficiency helped reduce peak demand by about 2 gigawatts.
As Canary Media reported, extensive battery storage in Vermont further reduced grid strain during peak demand. Green Mountain Power, a utility provider in Vermont, was able to reduce strain on the grid via residential and EV batteries, saving customers around $3 million.
“Green Mountain Power has proven that by making these upfront investments in batteries, you can save ratepayers money,” Peter Sterling, executive director of the trade association Renewable Energy Vermont, told Canary Media. “It’s something I think is replicable by other utilities in the country.”
Acadia Center warned that recent cuts to the Inflation Reduction Act for clean energy investments will likely limit states’ and utility providers’ abilities to quickly, efficiently respond in similar peak energy demand scenarios, which would increase risk of power disruptions to consumers.
“Those resources are susceptible to equipment failure and to outages, and there is correlated outage risk across the very large fleet of natural gas generation in the region,” Dickerson said. “All the more reason why we need to diversify the region’s portfolio.”
Relying solely on fossil fuel energy sources alone will not be enough to meet demand, especially during heat waves like the one observed in New England on June 24.
“Taken together, the June 24 heat wave event was a clear example of a successful portfolio-based approach, using multiple complementary clean energy resources — solar, energy efficiency, energy storage, transmission imports, and beyond — to help ensure resource adequacy for the grid and relieve extreme prices for the region’s consumers,” the Acadia Center report concluded. “Unless further thwarted by counterproductive federal proposals, the northeast will see an increasingly diversified clean energy portfolio called upon to meet similar peak demand events in the years ahead, minimizing the reliance on aging, inefficient fossil fuel power plants to serve peak demand.”
To read the full article from EcoWatch, click here.
How Trump’s big law impacts Massachusetts
The massive tax and domestic policy bill passed by Congressional Republicans and signed by President Trump this month expands tax cuts, limits Medicaid and food assistance programs, balloons immigration enforcement spending, and adds trillions to the national debt.
The WBUR newsroom took a look at how some key provisions may affect residents and programs in Massachusetts.
“The [Big Beautiful Bill] is bad, bad, bad for Massachusetts. Bad for ratepayers’ wallets, bad for grid reliability, bad for energy independence,” wrote Kyle Murray, Massachusetts program director at the Acadia Center, a climate advocacy and research group, in an email. “It will be a setback for the clean energy industry and will force Massachusetts to adopt new creative strategies to keep vital public policy goals on track.”
To read the full article from wbur, click here.
Batteries are playing a bigger role in keeping the lights on during New England heat waves
Battery storage and small-scale solar played a critical role in keeping New England’s electric grid reliable and may have saved customers tens of millions of dollars during late June’s major heat wave, according to a new analysis.
As temperatures soared above 100 degrees Fahrenheit and the region saw thick humidity, people cranked their air conditioners, drawing more power from the grid.
That shift could have saved consumers more than $19 million, according to an analysis by the Acadia Center, a regional environmental nonprofit and thinktank.
Absent all that rooftop solar, Acadia Center estimates New England would have broken its 19-year record for peak demand.
Power banking
The Acadia Center and ISO New England say power storage also played a critical role in keeping the lights on during this heat wave.
“I think people are really starting to understand that the value of renewables increases substantially when you pair them with batteries,” said Noah Berman, with the Acadia Group.
Batteries — whether smaller ones in people’s homes, or bigger “utility scale” ones plugged into the regional transmission grid — store power when it’s cheap and plentiful, like solar energy in the middle of the day.
Analysts with the Acadia Center hope batteries and a little extra coordination on the part of grid operators and utilities could help make that future winter peak lower, saving money and carbon emissions.
To read the full article from Vermont Public, click here.
Behind-the-meter Solar Shines in ISO-NE Capacity Deficiency Event
ISO-NE’s capacity deficiency event demonstrated the significant benefits of solar resources, along with their limits in displacing fossil resources during peak load periods.
Amid the rapid growth of behind-the-meter (BTM) solar in New England, a capacity deficiency event demonstrated the significant benefits of solar resources, along with their limits in displacing fossil resources during peak load periods.
Without the contributions of BTM solar, ISO-NE estimates the peak would have reached over 28,400 MW at about 3:40 p.m. The 2,400-MW reduction in the region’s peak provided significant cost and reliability benefits to the grid. According to an analysis by the Acadia Center, “BTM solar avoided as much as roughly $19.4 million in costs on this single day by suppressing the overall price of wholesale electricity.
In the wake of the capacity deficiency event, clean energy advocates made the case that increased energy storage capacity would have provided significant benefits during the peak.
“Had we had even more behind-the-meter solar paired with storage online, we could have potentially completely avoided that absurd price spike later in the evening,” said Kyle Murray of the Acadia Center at the June 25 hearing.
The Acadia Center wrote in its analysis of the event that there is “clear evidence that additional BTM battery energy storage would have been able to further reduce the overall cost to consumers by increasing flexibility and shifting the solar production later in the day, dampening the early evening peak prices.”
To read the full article from RTO Insider, click here.