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Utility Makes Call On Fixed Vs. Variable Wholesale Supply Contracts

Resulting New Default Service Rates Falling 12% For Mass Market Customers

March 28, 2022

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Copyright 2010-21
Reporting by Paul Ring •

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Fitchburg Gas and Electric Light Company d/b/a Unitil has filed with the Massachusetts DPU electric basic service rates for the period beginning June 1, 2022.

As previously reported, due to potential premiums on wholesale prices due to uncertainty surrounding the City of Fitchburg's opt-out aggregation, the DPU authorized Unitil to conduct an alternative default service procurement in which, among other things, Unitil solicited bids for both fixed and variable prices to serve basic service customers in the small and medium classes.

See full background on the alternative mechanism here

After evaluating the responses to the RFP, based on considerations previously reported in our story on the approval of the alternative plan, Unitil elected fixed wholesale pricing for the six-month term starting June 1, 2022.

Procurement of supply at fixed rates precludes potential interim adjustments that had been possible had supply been purchased at variable rates (under a previously reported threshold set by the DPU)

Specifically, Unitil selected NextEra Energy Marketing, LLC as the supplier for both the Small Customer Group basic service supply requirement and the Medium Customer Group basic service supply requirement under fixed price bids for the six-month period beginning June 1, 2022.

Unitil had also sought 50% of the supply for the small and medium groups for the period December 1, 2022 through May 31, 2023 for 50% requirements, under fixed pricing. Bidder responses to this tranche were redacted, but unlike with the summer period, in which Unitil specifically said it had awarded the supply obligation and named a winner, Unitil did not likewise announce an award for the sought winter supply

Unitil has filed new basic service rates reflecting the recent procurement

As filed, the fixed basic service charge for residential customers (RD-1, RD-2) and Small General (GD-1) commercial customers is $0.13436 per kWh for the period June 2022 to November 2022. That's about 12% lower than the current rate of $0.15298/kWh

Additional rates are below; the rates remain subject to DPU approval.

Fitchburg Gas and Electric Basic Service Rates

June 2022 - November 2022

Residential (RD-1, RD-2), Small General (GD-1)
Fixed Rate:
Jun-Nov     $0.13436

Monthly Rate Option
Jun 2022    $0.11948
Jul 2022    $0.13379
Aug 2022    $0.13343
Sept 2022   $0.12758
Oct 2022    $0.12740
Nov 2022    $0.16350

Medium General and Outdoor Lighting
(GD-2, GD-4, GD-5, SD)

Fixed Rate:
Jun-Nov      $0.13276

Monthly Rate Option
Jun 2022     $0.11343
Jul 2022     $0.13090
Aug 2022     $0.12947
Sept 2022    $0.12801
Oct 2022     $0.12598
Nov 2022     $0.16800

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