Why Are CT Electric Rates So High?
It’s no secret that CT has some of the highest electricity rates in the country. That means massive bills all year long, especially during the winter and summer months. Because of this, many energy customers have to ask, “Why are our rates so high?” The way I see it, the CT electric price problem boils down to three main problems. Let’s talk about the challenges CT utilities and lawmakers face.
CT Customers Face Program Costs
We’ve talked at length about how the public benefits charge helps cause high electricity bills. The charge covers what Eversource and UI must pay to run state-mandated programs. This includes clean energy initiatives and the moratorium on shutoffs due to unpaid bills during the pandemic. But nearly 80% of the charge was due to the 2017 Millstone power deal. In effect, Eversource and UI must purchase some of their basic service supply from the power station. However, the price can be higher than the market price.
As a result, these utilities pass the costs onto homeowners and businesses in their monthly bills.
CT Electric Supply Problems
According to EIA data, nearly 40% of the electric supply in CT is generated by natural gas. This is a problem because CT must import natural gas from other states and countries. This means we’re not only dealing with the volatile nature of the natural gas market, but we also have to deal with import costs.
There are many factors driving natural gas prices that affect how PURA sets CT gas and electric utility rates. This includes natural gas supply shortages if one of the four big interstate pipelines to CT must reduce gas flow. Gas utility pipeline maintenance and repairs in CT are also another factor that affect prices. As you can guess, the cost to maintain, improve, and fix these pipes are passed on to customers.
Simply put, CT only has so many pipes and those pipes only have so much capacity.
Why CT Needs Renewable Energy
This isn’t to say that there aren’t alternatives. Electric costs could fall if CT could generate more of its own power. That’s why many homes and businesses have looked to solar panels as a renewable means to offset energy costs. However, the state would need many renewable energy projects to more fully shake off its natural gas dependency.
Unfortunately, too many of these projects fail to get off the ground.
For example, Avangrid had to cancel the Park City Wind Project in 2023 because it was deemed financially unfeasible. More recently, CT pulled out of a three-state wind project deal due to concerns about bill increases. Unfortunately, this move has made it less likely that other states would join CT in future energy projects. All the same, state lawmakers and utilities are still struggling to find renewable projects that meet state energy needs and lower rates.
What CT Electric Customers Can Do
It’s hard to say where electric rates will be in CT in the next decade. In the near term, it’s hard to deny that things look rough for both electric companies and consumers. But the best way for consumers to lower their rates is to shop for the cheapest electric rates in town, right here at https://www.ctenergyratings.com. And we will keep an eye out for the news that could affect your CT energy bills.