Rhode Island Lt. Gov. Dan McKee is continuing to pressure National Grid to lower rates immediately for Rhode Islanders, even though the company has recently said it was reducing its request for a rate increase that it hopes to impose in the fall.
McKee’s response, and the company’s adjustment to its rate increase request come on the heels of approval in Congress of a substantial corporate tax rate reduction, from 35 percent to 21 percent. McKee is pressing the company and the Public Utilities Commission to lower rates now.
The company, at the urging of the PUC, announced recently that it was lowering its proposed distribution rate hike of 6 percent for electricity and 5 percent for gas by more than $25 million. National Grid had initially requested an increase of more than $71 million that has now been reduced to $45 million. If approved, the new rates would not be implemented until September.
Meanwhile, the company did receive approval in August to raise winter electricity rates from 6.3 cents per kilowatt-hour to 9.5 cents, meaning an average increase of $17 per month. Neither the PUC nor National Grid has suggested any rollback in that increase.
“I’m encouraged by National Grid’s response to my request to lower their proposed 6 percent electric and 5 percent gas rate increases in light of the federal corporate tax reduction,” McKee said. “This is a step in the right direction, but this solution, on its own, will not provide taxpayers with a single penny of relief until September when the Grid’s proposed rate is set to go into effect.
“In the letter I sent to the PUC, I also called for a rollback of National Grid’s current rates, which will impact Rhode Islanders between now and September first,” McKee said. “During this time, the Grid will enjoy savings from the corporate tax break, yet Rhode Islanders will continue to pay an inflated and inaccurate price for their energy…I’m calling for immediate relief.”
In Massachusetts, McKee said, Eversource electricity customers are receiving immediate relief.
Within the first few days of January, Eversource announced it was rolling back a $37 million rate increase that was approved by regulators for customers in eastern and western Massachusetts. According to an article in the Boston Globe, the rate decrease will result in almost $56 million savings to the company’s 1.4 million Massachusetts customers.
“If taxes are reduced ultimately, costs are reduced and that benefits our customers,” Craig Hallstrom, Eversource’s president of Massachusetts electric operations, said in a statement that was published in the Globe.
Meanwhile, National Grid, in a statement on its website, noted that its proposed September rate increase will be subject to several months review by the PUC. It also said that this was the first proposed adjustment to base distribution rates since 2012.
“We are committed to ensuring that the tax savings of the legislation are fully realized and are used to help our customers in their energy bills,” said Tim Horan, president and COO of National Grid in Rhode Island.
The company’s statement said National Grid is continuing to assess the impact but anticipates “customers will see smaller bill impacts than originally proposed, which will vary across rate classes and customer usage.”
Gov. Gina Raimondo, in a statement in contrast to McKee’s, praised the utility for responding to her call.
“I’m pleased that National Grid is responding to my call to protect Rhode Island taxpayers. in light of federal tax changes that slash the corporate tax rate from 35 percent to 21 percent,” the governor said. “National grid sets aside a percentage of the money Rhode Islanders pay for electricity and gas to pay its taxes; those are ratepayers’ dollars. Rhode Islanders deserve to get significant relief on their energy bills as a result of the massive tax cut that the President and Congress have given to large corporations like National Grid.”