AG won't appeal Unitil rate increase
By Chris Camire, ccamire@sentinelandenterprise.com
Posted: 08/12/2011
BOSTON -- State Rep. Stephen DiNatale said a hike in utility rates for Unitil customers is likely inevitable, after the Attorney General's Office said it will not appeal the increases.
DiNatale, a Fitchburg Democrat, met with representatives from the Attorney General's Office Wednesday to discuss the possibility of them intervening on behalf of city residents and businesses who are being impacted.
Fitchburg Mayor Lisa Wong and representatives from the offices of state Sen. Jennifer Flanagan, D-Leominster, and state Rep. Richard Bastien, R-Gardner, were also in attendance.
"Unless they can see factors within the order that are arbitrary and capricious they will not file an appeal," said DiNatale. "They said there is no justification for it. They felt overall it was a positive determination keeping in mind it could have been much worse."
The Department of Public Utilities approved a rate increase last Monday for Fitchburg Gas and Electric Light Co., which is owned by Unitil Corp. of New Hampshire.
For regular residential customers who are not subsidized, the DPU announced monthly electric bills will increase by $6.08 on average. For the same customers, the natural-gas bill will increase by $27.70 during the winter months and $4.51 during the summer months on average.
The DPU trimmed 31 percent, nearly $7 million, off the $22 million in storm-related expenses the company sought to raise with fee increases.
"It's still a very bitter pill to swallow," said DiNatale. "It's outrageous. I know my constituents and the citizens of Fitchburg wanted no increase because of the way the storm was handled."
Calls to cut ties with Unitil were amplified after the major power outages in the Fitchburg area during the ice storms in 2008.
Lawmakers from North Central Massachusetts now want to give cities and towns the tools to form their own utilities. They support legislation that could lead to the creation of the state's first municipal electric utility in 85 years, which they say would result in better service and prices.
The legislation was introduced nearly a decade ago. Last year it gained more traction than ever before, making it out of committee, but failed to reach the House floor for a vote. It remains to be seen whether the Committee on Telecommunications, Utilities and Energy will recommend the bill this year.
According to a 2010 state Department of Energy Resources report, electricity rates at municipal light departments is significantly lower than at investor-owned utilities. In fact, in 2006, rates offered by the state's 41 so-called "munis" were 30 percent less.
Unitil charges significantly more than other investor-owned utilities in the state, according to the Massachusetts Alliance For Municipal Electric Choice, a private group that supports the bill and munis. For example, Unitil charged $95 per 500 kilowatts from January to March this year, compared to $85 for NStar, $78 for WMECO, $73 for National Grid and $70 for munis.
Under the legislation, once the Department of Public Utilities determines the value of poles, wires and other equipment in a community, the utility would be required to sell the infrastructure if the municipality wants to form its own utility.
It would likely cost million of dollars to purchase this equipment, which would prevent many communities from rushing to form their own utilities, said DiNatale.
"We're redoubling our efforts on the muni-choice bill," said DiNatale. "I'm hopeful, and I believe it looks good to be reported out favorably again. We're looking to get it across the goal line this time."