CHICOPEE, Mass. (WWLP) – Following a winter that saw dramatic increases in utility bills, one of the region’s largest power companies is now proposing a drastic rate cut. National Grid announced Monday that they are proposing a substantial cut in the supply rate for their basic service customers. The rate change would have to be approved by the Massachusetts Department of Public Utilities.
For a customer who uses 500 kilowatt hours of electricity per month, the supply portion of their bill will decrease by more than 40% (from 16 cents/kWh to 9 cents/kWh,) bringing down their overall bill by about 26%, or about $32.
If approved, the rate change would take effect on May 1.
Still, the decline in the supply rate does not lower the cost of electricity to the levels seen last year, which were slightly lower. Back in the fall, the Department of Public Utilities had approved a supply rate increase that raised the bills of the average National Grid customer by about $33 per month starting in November.
National Grid says that the fluctuations in rates are due to changes in wholesale energy market prices, which the company says are higher in New England due to a lack of natural gas pipeline capacity. The supply rate is dictated by the cost of generating electricity. National Grid and Eversource Energy (formerly WMECo) only deliver electricity to their customers; they do not generate it themselves.
Both National Grid and Eversource set their rates every six months, but they are on a different schedule. The supply rate for Eversource customers didn’t go up until January, so any potential decrease wouldn’t happen until July. Eversource spokesperson Priscilla Ress told 22News said it is too early to tell what their rates will be going into the summer, but National Grid’s proposed rate cut is a “very good sign” for Eversource customers.