Electric Rate Update

It was announced that Connecticut’s Public Utilities Regulatory Authority (PURA) is advising Eversource and United Illuminating (UI) electric customers of revised delivery rates and standard service generation rates that become effective on June 1, 2021 and July 1, 2021, respectively. On average, electricity rates will decrease starting July 1; however, the Authority notes that a customer’s total bill may increase or decrease depending on individual energy usage each month.

On June 1, delivery rates will increase for Eversource customers by approximately 2% – or less than $3 per month for a residential customer using an average of 700 kWh of electricity a month. This increase is largely due to changes to the Transmission Adjustment Clause (TAC), which includes charges associated with the construction, maintenance and operation of the transmission grid regulated by the Federal Energy Regulatory Commission (FERC). PURA is currently reviewing proposed delivery rate adjustments for UI customers in an ongoing proceeding.

On July 1, average standard service generation rates – or the “supply” portion of a customer’s bill – will decrease by 16% and 14% for Eversource and UI customers, respectively. The changes will decrease monthly electric bills by over $9.50 for a typical Eversource residential customer and $9.00 for a typical UI customer using an average of 700 kWh of electricity a month.

In total, the June and July rate adjustments will result in reduced electric rates starting July 1; Eversource customers’ rates will decrease by roughly 4%, whereas UI customers’ rates will decrease by approximately 6%. The resulting decrease in electric rates (the $/kWh charges on customers’ bills) does not guarantee that a customer’s bill will be reduced, as a customer’s total bill is largely driven by energy usage. Customers interested in reducing their consumption of electricity should explore the options available to them through the state’s efficiency programs.

Nearly 80% of Connecticut’s residential customers receive standard service generation from Eversource and UI. The remaining residential customers receive their electricity from one of the state’s licensed electric suppliers, whose rates may be more or less than the standard service depending upon contract terms and the energy source.

Supply rates (called standard service) are adjusted twice a year in January and July, based on a competitive bidding process, and correlate to wholesale electricity market prices. While PURA oversees the competitive bidding process during which the electricity is procured to supply standard service customers, the agency does not regulate the wholesale electricity market or its pricing.

Typically, standard service rates increase in the first half of the year due to higher regional winter prices for natural gas, which fuels most of the region’s wholesale power. Standard service rates, by contrast, traditionally decrease in the second half of the year. This variation ultimately benefits ratepayers as electric usage rises in the summer months when standard service rates decline.

Customers can find a summary of delivery and standard service generation costs on the first page of their electric utility bill. PURA has also created the following narrated tutorials for ratepayers to better understand their electric bill from Eversource Energy or UI. Additionally, PURA staff are overseeing an effort to improve bill design and presentment to Eversource and UI customers, with a proposal due to the Authority this September as part of Docket No. 14-07-19RE06.

Ratepayers can compare Eversource and UI standard service generation rates to licensed electric suppliers’ current offers on Connecticut’s official generation rate board at www.energizect.com. PURA also urges all customers to review the supply summary on the first page of their electric bill each month.