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Officials, groups rap Eversource rate hike plan



For the Bulletin
Sunday, September 10, 2017

A flurry of opposition to the proposed nearly $96 million rate hike by Eversource was filed with the state Department of Public Utilities last week to meet an Aug. 31 public comment deadline.

Organizations ranging from Climate Action Now to the Massachusetts Municipal Association, the Metropolitan Area Planning Council and a consortium of municipal leaders from around the state called on the DPU not only to reject the utility’s proposed hike in fixed rates but also to reject rate changes they claimed would curtail solar projects.

In addition to its existing fixed monthly customer charge and a per-kilowatt-hour charge for power used, Eversource is proposing a peak “demand charge” for solar customers, based on how much electricity they use in their highest 15-minute period in the month.

Northampton Mayor David Narkewicz, copying a letter by Boston City Council President Michelle Wu and 26 other Massachusetts municipal officials, slammed Eversource’s requested 10.5 percent return on equity and wrote to “oppose any changes in rate structure that de-incentivizes energy efficiency and local renewable energy development.”

Pointing to those rate structure changes as contradictory to the state’s greenhouse gas emission targets, the officials opposed increases in monthly fixed charges and creation of a “monthly minimum reliability charge” for new net metering customers and a proposed 41 percent reduction in net metering rates paid to cities and towns for photovoltaic systems.

“Abruptly reducing municipal net metering rates without grandfathering would undermine existing and future investments in renewable energy by communities,” they add.

Citing municipalities’ “key role” in making Massachusetts a solar-power leader, Massachusetts Municipal Association Executive Director Geoff Beckwith pointed to the Legislature’s action last year preserving the higher net-metering rate for municipal projects and called the proposed change an attempt to “circumvent the Legislature and do the opposite of what lawmakers intended … to reduce emissions and allow the state to meet its goals.”

Through that change and a new “Monthly Minimum Reliability Contribution,” Beckwith said, municipalities would face added costs that would need to be passed on to taxpayers or have services cut.

“This is a really sneaky way to say, actually, we’re just going to change the definition of the rate class,” said Climate Action Now spokeswoman Adele Franks of Northampton. “They’ve invested so much money in solar to save their municipalities money … and this would have a severe economic impact.”

Franks’ written testimony this week said Climate Action Now opposes the utility’s “proposal to more than double the fixed customer charge for residential ratepayers (which) … devalues energy efficiency as it decreases a customers’ ability to lower their electric bill by using fewer kilowatt hours.”

“We need MORE solar energy in Mass., not less,” Franks wrote of the utility’s plan to add demand charges and charge photovoltaic customers demand-meters fees. Reducing compensation for solar projects by the rate class, she said, “would dissuade people, businesses and municipalities from installing or subscribing to solar arrays.”

The environmental organization also criticized requiring customers with new photovoltaic systems to pay higher fixed charges than other residential customers as well as lowering the Net Metering Credit value for customers who sell excess energy back to the utility.

“Utilities should be adapting to and fostering the development of distributed generation, not clinging to outdated business models that profit only from centralized generation and inhibit distributed generation,” Franks wrote, arguing that customers who install PV help all customers save the cost of building and maintaining more centralized power plants to meet demand.

Eversource spokesman Michael Durand has said the new residential demand charge for PV users, similar to one already in place for all commercial and industrial customers, is intended to ensure that net-metering customers, who typically use less electricity, pay their “fair share” for maintenance of the company’s distribution equipment needed for peak load, instead of having it “cross-subsidized” by other customers. Those PV customers also will pay a distribution rate that is half of the 5.6-cent per-kilowatt charge for non-solar residential customers.

At an April 26 public hearing before the DPU in Greenfield, Eversource’s regional president for electrical operations Craig Hallstrom said the changes in the rate proposal for PV customers “are simply designed to make sure that all customers pay their fair share for use of the grid instead of shifting those costs onto customers” who do not install solar panels.”

In its rate case, revised on June 19, in response to criticism that western Massachusetts customers were bearing an unfair share of a January filing, Eversource proposed to increase western Massachusetts rates to generate an additional $35.7 million — an approximate 27 percent increase over current revenues — in two phases, effective next Jan. 1 and on Jan.1, 2019.

A typical non-heating residential customer who uses 543 kilowatt hours of electricity per month would see a monthly bill increase of $9.78, or 8.6 percent effective Jan. 1, with an additional $1.54 increase, or 1.2 percent, effective Jan. 1, 2019.

On the Web: http://bit.ly/EversourceRateCase