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Utility's Default Service Rates To Increase Over 50%

Lt. Gov.: Utility Should Have More "Flexibility" in Default Service Procurement

Gov. Urges Regulators To Use All Tools At Disposal

August 14, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

Narraganset Electric (National Grid) SOS electricity rates in Rhode Island are due to increase over 50% for the six-month period beginning October 2017 for residential and commercial customers, under proposed rates filed with the PUC.

The filed rates have prompted outcry from certain stakeholders, and Lt. Gov. Daniel McKee said in a letter to the PUC that National Grid should be given "more flexibility" in its procurement of SOS, so National Grid can respond more effectively to conditions in the power markets

McKee, who led efforts to develop the state's retail energy shopping website, noted that competitive retail suppliers have rates much lower than Grid's proposed rates for the October-March period, and asked the PUC to consider what procurement practices used by retail suppliers could be adopted by National Grid.

Gov. Gina Raimondo, in a weekly radio address, also said that she is, "urging our regulatory team to use all of the tools at their disposal to put consumers first."

Under National Grid's proposed filing, the SOS rate proposed for the Residential Customer Group for the October 2017 through March 2018 period, including the current per-kWh Standard Offer Adjustment Factor of ($0.00465), the Administrative Cost Factor of $0.00148, and the Renewable Energy Charge of $0.00040 is $0.09515/kWh. This is an increase of $0.03287/kWh or 53%, compared with the current SOS rate of $0.06228/kWh.

Compared to the previous year’s October 2016 through March 2017 Residential Group SOS average rate of $0.08179/kWh, the proposed rate of $0.09515/kWh is 16% higher than the same six month period in the previous year. Compared to the previous 5-year January through March average rate of $0.08652/kWh for the 2012 through 2016 winter periods, the proposed rate of $0.09515 is 10% higher.

For the Commercial Customer Group, the fixed price option SOS rate for the October 2017 through March 2018 period, including the current per-kWh SOS Adjustment Factor of ($0.00304), Administrative Cost Factor of $0.00122, and the Renewable Energy Charge of $0.00040 is $0.09350/kWh. This is an increase of $0.03194/kWh, or 52% compared with the current fixed price option charge of $0.06156/kWh. Compared to the previous year’s October 2016 through March 2017 Commercial Group SOS average rate of $0.08396/kWh, the proposed rate of $0.09350/kWh is 11% higher than the same six month period in the previous year.

The variable price option proposed SOS rates for the Commercial Customer Group including the current per-kWh SOS Adjustment Factor of ($0.00304), Administrative Cost Factor of $0.00122, and the Renewable Energy Charge of $0.00040 are as follows ($/kWh):

• October - $0.06969

• November - $0.07802

• December - $0.09201

• January - $0.11527

• February - $0.11585

• March - $0.08827

For the Industrial Customer Group, the SOS rates for the October 2017 through December 2017 period, including the current per-kWh Standard Offer Adjustment Factor of ($0.00507), the Administrative Cost Factor of $0.00122, and the Renewable Energy Charge of $0.00040 are:

• October 2017: $0.05264/kWh.

• November 2017: $0.06046/kWh.

• December 2017: $0.08011/kWh.

All rates described above remain subject to PUC approval

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