The settlement, approved unanimously by the Rhode Island Public Utilities Commission in an open meeting, gives the state’s dominant utility about one-third of its original $214.8 million request made last November and less than two-thirds of a revised request of $137.5 million that factored in changes to federal taxes by the Trump administration.
The version of the settlement amended by the commission is also about $4.5 million lower than the initial iteration that was filed in June and resulted from negotiations between the Rhode Island Division of Public Utilities and Carriers, National Grid, the state Office of Energy Resources and other stakeholders, such as nonprofit groups the George Wiley Center and Acadia Center.
Read the full article from the Providence Journal here.
“The settlement includes several changes to the utility business model, which should begin to change the incentives for National Grid — away from traditional capital investments and towards outcomes that benefit consumers and the environment,” Mark LeBel, staff attorney for the Boston-based Acadia Center, wrote in comments to the PUC.
Read the full article from the Providence Journal here.
PROVIDENCE – Today, a comprehensive settlement was filed on behalf of all parties in two related dockets at the Rhode Island Public Utilities Commission: National Grid’s rate case and the Power Sector Transformation docket. Acadia Center strongly supports the settlement because it begins to reform the utility business model, makes significant investments in a modern and efficient electricity grid and new clean energy programs, and lays out a pathway for even more ambitious and rigorous reforms. It also saves ratepayers over $40 million in base rates across three years from National Grid’s original proposal and results in a 25-30% bill discount for low income customers. This settlement follows in the footsteps of the Power Sector Transformation Initiative created at the direction of Governor Gina Raimondo.
“New clean energy technologies at lower costs offer an historic opportunity to build a modern, more equitable energy system that benefits consumers, reduces pollution and improves economic productivity,” said Daniel Sosland, president of Acadia Center. “With this settlement, Rhode Island jumps into a leadership role among the states on utility regulatory reform necessary to position it for further progress in coming years. Acadia Center is thrilled that Rhode Island is moving to embrace this future and remains committed to ensuring that the state and its residents see significant benefits from these reforms.”
Acadia Center participated in every phase of the Power Sector Transformation process in 2017 and filed testimony in both dockets covered by today’s settlement. Acadia Center has long advocated for states to embrace the types of reforms included in the settlement, through reports and materials such as UtilityVision. This includes reforms to the utility business model that place less emphasis on capital investments and more on results, improvements to the efficiency, intelligence and flexibility of the electric grid, and planning improvements to efficiently use local energy resources and provide customers with better incentives.
“Rhode Island is poised to be the first state in New England to implement serious reforms to the utility business model,” said Amy Boyd, senior attorney at Acadia Center. “This is a key step to incentivizing utilities to act in the public interest, instead of merely advancing their own bottom line.”
The settlement also includes new clean energy programs to facilitate increased adoption of efficient electric heating technologies, new investments in electric vehicle charging stations, and competitive procurements for advanced energy storage. It creates a pathway for critical next steps such as a study of advanced metering functionality and time-varying rates and further utility business model reforms.
“Electrification of heating and transportation are crucial pieces of a long-term greenhouse gas reduction strategy. New programs and investments should help push Rhode Island forward in the coming years.” said Mark LeBel, staff attorney at Acadia Center. “In addition, Acadia Center looks forward to next steps and further reforms in Rhode Island. Providing Rhode Island ratepayers with more efficient electricity rates that reflect the costs of electricity usage and help lower peak demand will be key to a smarter electricity system and integrating electric vehicles and heating.”
“Acadia Center would like to thank the Division of Public Utilities and Carriers, National Grid, the Office of Energy Resources and other intervenors for all of the hard work and collaboration that went into this settlement,” said Erika Niedowski, policy advocate in Acadia Center’s Providence office. “Collaboration and an open exchange of ideas is crucial to developing policy solutions that meet the needs of a wide range of stakeholders. Establishing the Power Sector Transformation Advisory Group provides a new forum to continue this dialogue on key issues in the coming years.”
HARTFORD, CT – On April 18, 2018, the Connecticut Public Utility Regulatory Authority (PURA) announced its decision to lower the customer charge for Eversource residential customers from $19.25 to below $9.50. This 50% reduction follows the requirements of a 2015 law enacted by the Connecticut General Assembly to limit residential customer charges, the fixed fee that customers pay regardless of the amount of energy used. Acadia Center first raised this issue in Connecticut in Eversource’s previous 2014 rate case, and, since 2015, has participated in two rate cases and a generic proceeding to ensure the proper implementation of the law.
“Connecticut has taken an important step today towards a clean and consumer-friendly energy system,” said Daniel Sosland, President of Acadia Center. “The Office of Consumer Counsel, Attorney General’s Office, and the Connecticut General Assembly have made major progress in bringing relief to Connecticut’s electric customers, and Acadia Center looks forward to working with these partners as the state moves forward with further reforms to the energy system.”
Customer charges for residential electric customers typically range from $5 to $10 a month, but in some states are significantly higher. High customer charges disproportionately burden seniors and low-income customers, who typically use less electricity than average. They also reduce the incentive for customers to lower their electricity bills through conservation, investment in energy efficiency, or renewable energy technologies like solar power. Before the implementation of the new law, Connecticut’s residential customer charges for its two major utilities were $19 per month and $19.25 per month respectively.
Bill Dornbos, Acadia Center’s Advocacy Director, said, “Consumers everywhere prefer choice and control, and this lower monthly fixed charge will give customers substantially more control over their electric bills. The new rate design will also help promote energy efficiency and renewable energy, more closely aligning Connecticut’s electricity rates with its energy policy goals.”
“By enacting this significant reduction, Connecticut brings the state’s residential customer charges down to levels that are comparable with national best practices and recognizes that high fixed charges run counter to consumer interests and a clean energy future,” said Mark LeBel, staff attorney for Acadia Center. “This is a significant step at a time when states around the country, including neighboring New York, are debating how to move forward on this important issue.”
NEW YORK — On April 18, Central Hudson Gas and Electric proposed a settlement in its ongoing rate proceeding, in which it agrees to reduce its current electric and gas residential customer charge from $24 to $19.50 over three years. Central Hudson’s customer charge reduction makes it the first New York utility to reduce its customer charge in more than a decade.
Jen Metzger, Director of Citizens for Local Power, said: “Central Hudson’s historically high fixed charges have been a burden on many seniors and low- and moderate-income households, which tend use less energy. We welcome this important step in the right direction to alleviate this burden and make rates fairer by tying them more closely to how much energy customers actually use.”
Cullen Howe, Acadia Center’s New York Director, said: “Central Hudson’s agreement to reduce these regressive fees will benefit the majority of its residential customers. As the state looks to ramp up its efforts on energy efficiency and clean energy, Acadia Center believes it is crucial that New York utilities and regulators provide the right incentives to invest in these resources. Though Central Hudson’s fixed charge is still high and must continue to be lowered, other utilities should follow its example and begin reducing their customer charges as well.”
Also referred to as basic service or fixed charges, customer charges are flat fees that every customer pays, regardless of the amount of electricity or gas used. Across the country, fixed charges for residential electric customers typically range from $5 to $10 a month, but in some states — notably New York — these charges are significantly higher. Central Hudson’s current customer charges are the highest in New York and among the highest in the nation.
High electric customer charges disproportionately burden low-income customers, who typically use less electricity than average and generally benefit from lower customer charges. They also conflict with New York’s goals for a clean, modern, consumer-friendly electric system by removing any incentive for customers to lower their electricity bills through conservation, investment in energy efficiency, or renewable energy technologies like solar power.
While these reductions are an important step, other New York utilities have continued to maintain, or seek increases to, these charges. On March 15, for example, the Public Service Commission approved a decision allowing National Grid to maintain its existing monthly customer charge at $17, and Orange & Rockland County Utilities recently filed a rate proceeding seeking to increase its current $20 customer charge to $22. The New York Customer Charge coalition has set up a web site at www.lowerfixedcharges.org to continue advocating for lowering these charges and providing rate relief to low-income and low-usage New York energy consumers.
Jessica Azulay, Program Director at Alliance for a Green Economy, said: “We hope the Central Hudson agreement is the first step in a process to reduce fixed charges for all utilities across New York State. New York has set ambitious energy affordability and climate goals. Reduction in fixed charges is a major tool that utility regulators can and should use to accomplish both of those goals. We urge the Public Service Commission to use this tool aggressively to ease energy burdens for residential customers and incentivize conservation, energy efficiency, and investments in distributed renewable energy.”
Richard Berkley, Executive Director of the Public Utility Law Project of New York, said: “We are grateful to Central Hudson for taking the lead in beginning what will hopefully be a statewide reduction of New York’s extremely high customer charges. In a state where approximately half of residential energy consumers have trouble paying their utility and other vital bills such as food, medicine, mortgages or rent, taking concrete steps toward greater affordability by reducing these regressive charges is something we can all support, and we are equally grateful to our coalition partners and to the Department of Public Service for its assistance in bringing about the first reductions of these charges.”
“Fixed customer charges in New York are too high and are bad policy. This settlement marks an important step toward reducing the harmful effects that these charges have on customers, and in aligning rates with the New York vision for electricity markets,” said Karl R. Rábago, executive director for the Pace Energy and Climate Center and a former utility regulatory commissioner. “We are pleased that our years of work in rate cases in New York against these unfair utility charges is bearing fruit.”
Jonathan Bix, Executive Director of Nobody Leaves Mid-Hudson, said, “This nearly 20% reduction in Central Hudson’s fixed charge will increase affordability and decrease shutoffs for low-income customers. Although this reduction is a critical victory, Central Hudson and other utilities must continue to lower their regressive fixed charges, including Orange & Rockland Utilities through their current rate proceeding.”
57 Consumer, Clean Energy, and Community Organizations Call on State Leaders to Address Counterproductive Decisions
BOSTON — Today, Acadia Center, Health Care Without Harm, MASSPIRG, Vote Solar, and 53 other organizations released a joint statement pointing to serious concerns over decisions by the Massachusetts Department of Public Utilities (DPU) in Eversource’s recent electricity rate case. These decisions are inconsistent with the consumer-friendly clean energy future that Massachusetts is striving for. The 57 organizations bringing forward these concerns come from many different perspectives, including low-income and ratepayer advocates, environmental, health and clean energy public interest organizations, solar advocates, and clean energy businesses.
“Massachusetts is embracing many innovations on clean energy, including energy efficiency and offshore wind, that will boost the Commonwealth’s economy, benefit consumers, improve public health and reduce greenhouse gas emissions,” noted Daniel Sosland, President of Acadia Center. “Unfortunately, in four important ways, the DPU’s decisions in Eversource’s rate case represent a significant step away from embracing a clean energy future. Instead, these DPU decisions provide incentives for the company to invest in outdated and expensive energy infrastructure, reduce customer control, and impose significant unnecessary costs on consumers.”
Two of these decisions, unnecessarily high profit margins (known as the return on equity) and automatic annual revenue increases going forward, could collectively cost ratepayers an extra $460 million over five years. The other two decisions, unprecedented new demand charges on new residential solar customers and the elimination of optional residential on-peak/off-peak rates, would move away from electricity rates that are efficient and consumer-friendly.
“Hospitals typically have very small margins, so every unnecessary penny per kWh for Eversource means a lot less money for healing patients,” said Paul Lipke, Senior Advisor for Energy and Buildings at Health Care Without Harm. “Unless addressed, Eversource’s rate changes also increase pollution and shift costs from energy to health care. This conflicts directly with efforts to constrain the Commonwealth’s health costs, and at a time when households already spend six times on health care what they spend on energy. We can and must do better.”
“The Commission has decided to effectively raise costs, remove value and reduce customers’ understanding of and control over bills by approving Eversource’s new solar demand charge,” said Nathan Phelps, Regulatory Director for Vote Solar. “This decision is out of step with Massachusetts laws to encourage the state’s transition to a clean and reliable electricity system, and out of step with the DPU’s own prior leadership ensuring that solar customers are treated fairly for the local power they generate. We urge the Legislature and the Governor to reject this decision and reinstate Eversource customers’ right to lower their own utility bills with rooftop solar, protect the thousands of solar jobs serving our state, and deliver on the Commonwealth’s commitment to building a clean energy economy.”
“For many of us, our electricity bills are a significant monthly expense, and we rely on regulators to make sure utility companies like Eversource don’t overcharge ratepayers or adopt pricing practices that are deceptive or unfair,” said Deirdre Cummings, MASSPIRG’s Consumer Program Director. “In this case, the DPU has approved Eversource’s new pricing schemes that will result in hundreds of millions in excessive charges; while at the same time, Eversource has made it harder for consumers to monitor their electricity use and reduce their bills.”
“Residential on-peak/off-peak rates should be used as a key tool to manage peak demand. Historically, these have been underutilized because the utilities do not publicize them and make them difficult to sign up for,” said Mark LeBel, Staff Attorney for Acadia Center. “Instead of optimizing these rates and making them easier to access, the DPU let Eversource eliminate them.”
The decision on the return on equity is currently being appealed to the Massachusetts Supreme Judicial Court by Attorney General Maura Healey, and the decision on demand charges for new residential solar customers is being appealed by Vote Solar and other parties. The decision on demand charges is the subject of a bill recommended favorably by the Joint Committee on Telecommunications, Utilities, and Energy at the Massachusetts legislature, and a requirement for optional on-peak/off-peak rates is included in several different bills. The DPU recently denied the Attorney General’s motion for reconsideration on the automatic annual revenue increases.
The groups that oppose the rate settlement include the Alliance for a Green Economy, PUSH Buffalo, Acadia Center and Syracuse United Neighbors. They jointly released a statement earlier this week opposing the plan, which would gradually increase the typical monthly residential gas and electric bill for upstate National Grid customers by $16 by 2020. The coalition said the rate plan did not go far enough to make gas and electric service affordable for low-income customers or do enough to push renewable sources of energy.
After months of negotiations, a Joint Proposal was filed Friday, January 19, in the National Grid rate case, representing the settlement position of some parties in the case. The new proposed increases are as follows:
Under the agreement, the fixed charge for electricity would remain at $17.00 per month. The fixed customer charge is the portion of the bill that does not change, no matter how much electricity the customer uses. For more information see: www.lowerfixedcharges.org.
The Joint Proposal will now be open for public comment and consideration by the Public Service Commission. In response to the filing, some parties to the case who do not support the settlement released the following statements:
Cullen Howe, Acadia Center’s New York Director, said: “Acadia Center is disappointed that the Joint Proposal filed today does not address National Grid’s high fixed charges of $17 per month for residential customers. In contrast to its high fixed charges in New York, National Grid has a residential fixed charge of only $5 in Rhode Island and $5.50 in Massachusetts. These high fixed charges reduce customers’ ability to lower their electricity bills by using less energy, and they are ultimately incompatible with the energy future envisioned by New York’s Reforming the Energy Vision, which anticipates wide deployment of distributed energy resources and increased energy efficiency. By not addressing these charges, these goals are much more difficult to achieve.”
Jessica Azulay, Program Director of Alliance for a Green Economy, said: “We are disappointed that we were unable to reach an agreement with the parties in this case that would prevent a rate hike and support the State’s environmental goals. While there are some improvements made in the filed agreement as compared to National Grid’s original proposal, it does not go far enough to protect low-income households and the environment. In particular, we oppose any rate increase at a time when there is already an untenable affordability and economic crisis in Upstate New York, and we further call on the Public Service Commission to reduce the fixed charges on our bills. These fixed charges, which customers must pay regardless of how much energy they use — disproportionately hurt low-income customers by impeding their ability to control their bills through conservation, efficiency, and renewable energy participation. Finally, we oppose the provisions in the proposal that support ratepayer investments and incentives for gas expansion. The climate crisis demands that we stop investing our public money into gas infrastructure and that we support renewable-based heating options instead.”
Clarke Gocker, Director of Policy and Strategy at PUSH Buffalo, said, “Low income National Grid customers in Buffalo and Western NY struggle to afford the high cost of utility bills and want nothing more than to take control over their energy consumption, whether it’s through conserving energy, participating in no cost or cost-effective energy efficiency programs, or accessing rooftop and community solar opportunities that afford them real decision making power and actual savings. The Joint Proposal filed today with the Public Service Commission in the National Grid rate case fails to deliver the kind of direct benefits that can permanently reduce household energy burdens and create the conditions for energy democracy in marginalized communities. While settlement negotiations in the case, together with fallout from the recent federal tax cut plan, have appeared to reduce the potential rate impact for customers, any increase in utility rates is extractive and unaffordable for low income customers in our community, and for that reason PUSH Buffalo opposes the terms reached in the Joint Proposal.”
Rich Puchalski, Executive Director of Syracuse United Neighbors, said: “The Joint Proposal fails to once again look at the historic policies that have forced high electric and gas rates on low income families in Syracuse for all too long. Those living in 1, 2 and 3 family poorly insulated wood frame homes are shelling out hundreds of dollars especially in the last couple of months of below freezing temperatures. Shutoffs will escalate. Credit will be ruined, and the poor can’t manage their way out of the bills they get from National Grid. And this is a 3-year plan! HELP.”
NEW YORK — Acadia Center, Alliance for a Green Economy, Citizens for Local Power, Natural Resources Defense Council, The Public Utility Law Project of New York, and Vote Solar today launched a campaign to decrease one of New York’s most regressive and unfair charges for utility service: the fixed charge, an unavoidable monthly fee that all residential electric customers must pay regardless of the amount of electricity they use.
New York has very high fixed customer charges compared to other states, which can make energy unaffordable for many households and discourages investments in energy efficiency and renewable energy.
For example, National Grid has a residential fixed charge of $17 in New York, but only $5 in Rhode Island and $5.50 in Massachusetts. Central Hudson has even higher fixed charges at $24, which it is seeking to increase to $25, as well as add an additional tiered “service size charge” for many customers. Acadia Center found that current average residential customer charges for major investor-owned utilities are higher in New York than in all of its neighboring states.
A newly launched website, www.lowerfixedcharges.org, explains why a majority of utility customers would substantially benefit from lower fixed charges and contains original analysis and supporting information, including:
A letter signed by more than 130 New York public officials requesting that state regulators reduce fixed charges in New York;
Articles and op-eds on fixed charges;
Expert analysis on the consumer, economic, and environmental benefits of lowering fixed charges in New York; and
Opportunities for consumers make their voices heard on this issue by giving them the ability to submit comments in the National Grid and Central Hudson rate cases and the Reforming the Energy Vision (REV) proceeding.
Cullen Howe, Acadia Center’s New York director, said: “Fixed charges remain a stubborn and pressing problem in New York as it looks to modernize its energy system and give customers more control over their energy bills. Most states across the country use a definition for residential fixed charges that is much narrower than New York’s approach. This new web campaign gives New Yorkers valuable information on why residential fixed charges are too high and what they can do to address this problem.”
“We see no reason why utility customers in New York should be paying fixed charges that are three times higher than those paid to the same company by customers in other states,” said Jessica Azulay, program director of Alliance for a Green Economy. “It’s high time to reduce these charges so that low-income customers, low energy users, and people who want to invest in energy efficiency and renewables are no longer overburdened with these regressive and unfair costs.”
“A key goal of the Governor’s Reforming the Energy Vision Initiative is to empower New Yorkers to manage their energy use in a way that both supports the State’s clean energy goals and also reduces their bills,” said Jen Metzger, Director of Citizens for Local Power. “Lowering utility fixed charges must be part of this reform effort because high fixed charges prevent customers from realizing the savings that they should when they use less energy or install solar panels on their homes.”
Miles Farmer, a clean energy attorney at the Natural Resources Defense Council, said: “For New York to lead in developing utility regulation for the future, it must end its practice of high unavoidable fixed charges and instead design utility rates to encourage customers to save energy and install advanced technologies that will help them use energy even smarter.”
“New York has an energy affordability crisis, where as much as 50% or more of energy consumers chronically struggle to pay their vital bills like heat, light or medicine, due in large part to high energy prices,” said Richard Berkley, Executive Director of the Public Utility Law Project of New York. “High fixed charges worsen those affordability problems for low- and fixed-income and low-usage customers, and they disincentivize conservation. Both of those results are contrary to the State’s low-income affordability program and REV program goals. This coalition is dedicated to lowering high fixed charges to address those affordability concerns for New York’s vulnerable households, and also to help the State meet its renewable energy goals by helping consumers get ‘more green for less green.’”
Nathan Phelps, Program Manager at Vote Solar, said: “Families and business owners should be reaping the benefits of solar and wind energy, which are more affordable than ever, especially compared to traditional fuels. Instead, New Yorkers pay unnecessarily high fixed fees on their utility bill, regardless of how much electricity they use. Instead of passing on savings to customers, New York utilities are making it more expensive for them to invest in private solar, efficiency, and other clean energy technology. This brand new resource will shed light and offer solutions to New York’s high customer fee problem.”
Cullen Howe, NY Director
firstname.lastname@example.org, 212-256-1535 x501
Krysia Wazny, Communications Director
email@example.com, 617-742-0054 x107
A group of local officials and environmental groups have also raised concerns about Eversource’s proposal, which they say would reduce the compensation paid to cities and towns for solar projects by about 40 percent.
“The Eversource proposal that impacts these municipal solar projects is part of broader rate proposals to reduce customer control over bills and lower incentives for local clean energy,” Acadia Center staff attorney Mark LeBel said in a statement. “Eversource’s proposals would set back efforts to promote energy efficiency, electric vehicles, storage, and efficient electric heating too. The DPU should be looking for economically sensible ways to advance innovative clean energy efforts and should not roll back the progress the Commonwealth has made to date.”
Read the full article from State House News Service, published in the Berkshire Eaglehere.