DPU cuts Eversource rate hike by 60%

THE MASSACHUSETTS DEPARTMENT OF PUBLIC UTILITIES on Thursday cut Eversource Energy’s overall rate hike request by 60 percent, turning aside the company’s bid for $90.8 million and allowing an increase of $36.4  million.

The new rates are spread across the company’s operations in eastern and western Massachusetts, with the impact falling harder on residents in the western part of the state. Rates there will go up by $24 million, while rates in eastern Massachusetts will rise by half that amount.

DPU officials said the new rates will take effect on January 1 and will remain in effect until at least 2022.

Eversource spokesman Michael Durand said the company was disappointed with the decision. Attorney General Maura Healey, who had argued that Eversource should receive no rate increase at all, was disappointed for different reasons. She noted that the DPU ruling allows Eversource, after the initial rate hike, to raise rates 3.5 percent a year for each of the next four years.

“At a time when businesses are already struggling with high energy costs, the DPU’s order chooses unjustified corporate profits over Eversource’s 1.4 million customers,” she said in a statement. The department has allowed Eversource to raise rates by hundreds of millions of dollars, instead of imposing the decrease that customers deserve. Disappointingly, the increase includes a 10 percent shareholder return, one of the highest in the country.”

To help jumpstart the introduction of electric vehicles, the DPU authorized Eversource to spend $45 million extending power lines to locations across the state where vehicle-charging stations would be located. The cost will be recovered by Eversource from its ratepayers. While some have argued that Eversource should also own the charging stations themselves, the DPU decided to leave that investment and that business to the private market.

Durand said Eversource was pleased with the DPU’s decision on electric vehicle charging. “One of the greatest barriers to electric vehicle adoption is a lack of charging stations,” Durand said.

The DPU also approved a $15 million investment to construct a 5 megawatt energy storage facility on Martha’s Vineyard and a $40 million investment to construct a 12 megawatt energy storage facility on Cape Cod. Both investments, paid for by Eversource’s customers, are expected to make other initiatives, such as a new power cable from the mainland to Martha’s Vineyard, unnecessary.

Eversource asked the DPU to let customers pay their bills with credit cards at no charge, but regulators rejected the request as way too expensive. Currently, customers who pay with credit cards are assessed a fee of $2.25. Eversource had estimated doing away with the fee would cost the company about $6 million a year.

In its ruling, the DPU said the $6 million annual cost “would not only be the most expensive of all payment options, but the cost of processing credit and debit card transactions fee free would eclipse the total cost of processing all other payment types by almost 450 percent.”