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by MAMEC
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Electric rates on the rise
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By Brian Falla/ Daily News Staff
Wednesday, June 14, 2006
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NORWOOD -- Electric Light commissioners last night voted to increase electric rates to avoid giving ratepayers a huge shock in the future.
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The increase of 1 cent per kilowatt hour, which will raise the average ratepayer’s bill by $5 a month, will go into a stabilization account aimed at cushioning what could be a 60 percent increase when the town has to get a new electric power contract in 2009.
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The 1-cent-per-kilowatt-hour increase will mean a residential bill for 500 kilowatt hours will jump from $40.81 to $45.81 per month, but that is still well below what ratepayers in surrounding towns pay.
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According to the Light Department,
even after the 1 cent increase, local ratepayers will pay between 51 percent and 59 percent less than NStar customers, depending on usage
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Light Department Superintendent Malcolm McDonald told commissioners last night that the best estimates indicate that without rate increases the town will be $22 million short when it has to purchase electricity in 2009.
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Although the town distributes electricity through its own Light Department, it still has to buy electricity from wholesale providers. Rather than hit customers with what would be a 60 percent increase in rates, McDonald said the town’s Future Electrical Power Supply Needs Committee recommended a 1 cent increase this year with the idea of potentially raising it again in the coming two years to build up a stabilization fund.
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"It does not seem wise or prudent to burden ratepayers with the entire increase at once," said Commissioner Bill Plasko, who also sits on the committee.
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But the vote was not unanimous. Selectmen Tom McQuaid and Jerry Kelleher pushed for a 2-cent per kilowatt hour increase.
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"It seems to me 1 cent will not be enough," McQuaid said.
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McDonald said the 1 cent increase would put roughly $3.6 million into the stabilization fund in one year. "We can always revisit this next year," McDonald said.
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General Manager John Carroll stressed the increase has nothing to do with an ongoing lawsuit with New England Power that could cost the town more than $80 million.
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Brian Falla can be reached at 781-433-8339 or at bfalla@cnc.com.
