New National Grid rates will hike monthly household bills $16 after 3 years

By: Tim Knauss |

Upstate New York households will pay about 11 percent more for electricity and natural gas — a total of about $16 per month — under a National Grid rate hike approved today by the state Public Service Commission.

The price increases will be phased in over three years. The first increase hits next month, raising average electric bills 3 percent (or $2.22 per month) and increasing gas bills 1.7 percent ($1.20 a month).

When the full increases take effect in 2020, a typical residential customer will pay $102 per year more for electricity ($8.50 a month) and $90 more for natural gas ($7.50 a month.)

The estimated bill impacts are for residential customers using 600 kilowatt-hours per month of electricity and 1,080 therms per year of gas, based on documents filed by National Grid. The impact varies for commercial customers and for households that use other amounts.

The PSC approved the rates unanimously moments ago at its meeting in Albany.

The rate plan includes enhanced discounts for low-income customers, which should offset the increases for struggling households. For the neediest customers, the assistance program will reduce bills by as much as $40 a month below current levels, utility officials have said.

National Grid bills will go up even though the utility expects commodity costs for electricity and gas to decrease slightly. The rates approved today affect the utility’s delivery charges, which cover personnel costs and the operation and maintenance of its Upstate electric and gas systems.

Commodity energy prices are set in a competitive market, not controlled by the government. Both electric and gas commodity prices are at historic low levels, but could increase if unexpected events impact the market.

The new rate plan allows National Grid to earn profits of up 9 percent of its equity investment in the system. Profits above that level must be shared with customers.

The rate increase approved today is a compromise approved by the PSC staff and 18 interest groups, including low-income advocates, environmental groups, and an industrial customer group.

The compromise agreement was “much improved” over National Grid’s original rate proposal of April 2017, said John Rhodes, chair of the PSC. National Grid’s initial petition asked for rate hikes that would have increased household bills by 14 percent for electricity and 15 percent for gas.

The rate plan factors in about $75 million a year in anticipated tax savings that National Grid expects as a result of the recent federal tax changes.

New National Grid rates will hike monthly household bills $16 after 3 years