How high will my rates rise?
It’s enough to make you scream!
Just in time for the holiday season, Eversource will be raising its standard service generation rates on Connecticut and Massachusetts rate payers .
Connecticut residents will see increases of 18.8% to 10.1 cents per kWh. Meanwhile, those in Massachusetts will face a 20% increase to 13.704 per kWh.
United Illuminating customers will also face and increase to 11.22 cents from 9.66 cents.
The increase in your Connecticut electricity rates chiefly stems from lower amounts of natural gas in storage this winter. EIA reported working natural gas stocks were 601 Bcf lower than the five-year average and 528 Bcf lower than last year at this time.
Meanwhile, the NYMEX price for the December natural gas contract surged by $1.28, rising from $3.555/MMBtu November 7 to $4.837/MMBtu on November 14. Prices at the Algonquin Citygate in Boston for the same period went from $3.76/MMBtu to $10.16/MMBtu, no doubt propelled by the wintery weather moving up the east coast.
Usually, natural gas supply companies will pay storage services to keep their gas in storage to hedge against price spikes. However, the EIA also recently reported that the price spread between the contract price and the spot market price has been quite small — just 20 cents per mmBTU. EIA says this is significant because “When injection-season spot prices are closer to winter futures prices, traders have less economic incentive to store natural gas, particularly because of the fees associated with keeping natural gas in storage.”
The point is that both NYMEX and spot market prices are trending upwards. And while production and storage injections are at record levels, it’s pretty much squeaking ahead of demand.
New England generators are now fueled mostly by natural gas from the shale plays in Pennsylvania. And, as with so many preceding winters, both natural gas price and pipeline constraint continues to be a major cost-driver of Connecticut residential electric rates.
Will Keeping Millstone Open Lower This Winter’s Rates?
The short answer is no. However, these rising rates are undoubtedly adding to the capacity concerns haunting PURA regulators. Currently, they are planning to reclassify the financially troubled 2,111-MW Millstone nuclear plant as “zero-carbon” emissions. According to state law, generation resources that are at risk of closure are given market preference due to their environmental effects and grid reliability. Last January, the Connecticut Department Of Energy And Environmental Protection (DEEP) produced a report saying that Millstone would remain economically viable to its owner, Dominion, “under expected market conditions through 2035”. Legislation that would have explored financially aiding Millstone failed in June.
How Do I Keep My Winter Energy Costs Lower?
If you’re paying the standard service generation rate, the best way to begin cutting your monthly energy bills is to shop for the best rate and plan from a third party provider. Both Eversource and UI set their rates twice a year, on Jan. 1 and July 1. But competitive Connecticut energy suppliers are able to take advantage of hedging and competitive pricing to supply their customers with the lowest market rates available.
According to PURA, the generation rate accounts for about 40 percent of the monthly electric bill for most residential customers. Transmission and other costs make up the remainder. Cutting the price for 40% of your Connecticut electric bill can add up over the winter to some big savings! All you need to is shop and compare competitive offers that meet your family’s energy needs.
The place to shop and lock in the best deal on cheap Connecticut electricity is https://www.ctenergyratings.com.