BOSTON (STATE HOUSE NEWS SERVICE) – Attorney General Maura Healey is asking state regulators to ensure the utility company Eversource “is not over-earning at the expense of its customers” as it seeks to boost its electric rates by $96 million.
Eversource filed a request with the Department of Public Utilities to raise its charges by 7 percent in eastern Massachusetts and by roughly 10 percent in the western part of the state, with the first phase of increases taking place Jan. 1, 2018.
The rate hikes would need approval from the DPU, which has a series of public hearings planned throughout the state on the company’s request.
Healey, whose office is tasked with representing ratepayers in cases before the DPU, was scheduled to testify at a Tuesday evening hearing in Boston.
“As the state’s advocate for ratepayers, my office believes this is an important opportunity for the Department to reset the balance between company profits and customer rates,” Healey said in written testimony. “When so many customers today are struggling to make ends meet and business are trying to lower their energy costs to maintain and grow jobs, it is time to return money to customers not to raise their electric bills to benefit highly profitable utility companies.”
Through its subsidiaries NStar Electric and Western Massachusetts Electric Company, Eversource has 1.4 million electricity customers in 140 Massachusetts communities.
Healey asked that the regulators consider the average return on equity the company has earned in the past, which she said indicated “very high profits given today’s historically low interest rates.” From 2011 to 2014, Western Massachusetts Electric Company’s average return on equity was over 10 percent and NSTAR’s was close to 11 percent, Healey said.
She cited Regulatory Research Associates data saying that the average allowed return on equity was 9.3 percent for electric distribution companies in 2016, and said Eversource was requesting to earn a 10.5 percent return going forward.
Eversource officials said in an email to customers that the new rates would address “increases in operating and maintenance costs and capital costs associated with investments in the electric network since the last decision by the DPU approving a general distribution rate increase in 2006.”
“Customers are experiencing fewer and shorter outages as a result of our smart investments in sophisticated technology,” Craig Hallstrom, president of Massachusetts Electric Operations at Eversource, said in a January statement announcing the filing. “We’ve also worked hard to improve reliability for customers with efforts like our enhanced tree trimming programs, all while holding the line on rising costs. Now, we’re proposing to increase that commitment and utilize the latest engineering advances – including electric vehicle infrastructure and energy storage systems – for the benefit of customers.”
During the first phase of the rate change the typical non-heating residential customer in Greater Boston can expect a monthly bill increase of $9.08, with expected monthly increases of $5.05 in the Cambridge service area and $6.54 for typical customers in the South Shore, Cape Cod and Martha’s Vineyard areas, according to the DPU’s notice of filing.
NSTAR commercial and industrial customers “can expect annual bill impacts ranging from a decrease of 3.5 percent to an increase of 14.5 percent, on average, depending on the amount of their usage,” the notice said.
For Western Massachusetts Electric Company customers, the typical monthly bill is expected to increase by $11.51, while commercial and industrial customers are advised to expect annual monthly bill increases ranging from 0.6 percent to 18.3 percent.
The DPU’s next Eversource rate hearing is scheduled for 6 p.m. on March 30 at the Cambridge Public Library, followed by one on April 3 at 7 p.m. at the Barnstable County Complex. Additional hearings are planned throughout April in New Bedford, Plymouth, Pittsfield, Springfield, Tisbury and Greenfield.