National Grid electricity prices to drop

But savings less than last year and less than in New Hampshire

National Grid’s 1 million basic service electricity customers will see their monthly bills drop in May, but rates aren’t returning to the level they were last summer and they will be significantly higher than what customers in New Hampshire are paying.  

The utility buys electricity on behalf of its basic service customers every six months. Over the winter, rates hit a record 16 cents a kilowatt hour and were expected to fall back this summerNational Grid said prices will fall to 9.3 cents a kilowatt hour this summer, but won’t drop back to the 8-cent level where they were last summer. For a typical customer using 500 kilowatt hours a month, this summer’s rates will yield monthly charges that are $32 below the winter rates and $5 above last summer’s rates. 

Grid said the higher year-to-year prices are “due to higher wholesale electric prices in New England brought on by natural gas interstate pipeline constraints impacting the region.” The utility added: “New Englanders should be advised that though these power supply costs generally reflect a reduction in bills for the summer months, bills are likely to increase again next winter because of ongoing pipeline constraints.” 

The National Grid prices for this summer are significantly higher than what Liberty Utilities in New Hampshire is charging its customers. Liberty, which also buys electricity on behalf of its customers, is planning to charge its customers 6.8 cents a kilowatt hour this summer, down from 15.4 cents over the winter. The drop of 55.6 percent represents a savings of $47.25 on a typical monthly bill. 

Grid spokesman Jake Navarro said the difference in prices between the two utilities reflects the regulatory environments in the two states and possibly the timing of the electricity purchases. Massachusetts rates reflect much higher charges for clean energy policy initiatives, which boost the rate for a kilowatt hour by more than 2 cents. Renewable energy charges in Massachusetts alone add about 1.6 cents a kilowatt hour to the bill, compared to .6 cents in New Hampshire. 

Massachusetts’ energy efficiency programs, which use ratepayer dollars to finance initiatives to reduce energy consumption, save money overall because the cost of the programs is less than the cost of electricity generation. Indeed, Massachusetts leads the nation in energy efficiency efforts. But a number of studies suggests the cost of these programs in Massachusetts is higher than in any other state. 

Matt Golden, a principal with Efficiency.org, wrote an article for Greentech Media in December in which he said the top-down approach used in Massachusetts may not be the best. Massachusetts may spend the most per capita on energy efficiency, but it is, in fact, the least efficient state in the country at delivering savings,” he wrote.