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Electric bills may be less severe next month, with potential adjustment drop

March 28, 2013


PRINCETON — The purchase power cost adjustment that took ratepayers by surprise on their recent bill may not be as high for the next billing cycle, Brian Allen, general manager for the Princeton Municipal Light Department, said at a March 13 meeting.

He said he’d received a lot of phone calls about the rate increase. “Most were pretty understanding when you explain the reason, but some are pretty disgruntled,” he said. “The big question was, how long will it last.”

Allen referred to an explanation in the winter issue of Join Action News from MMWEC that explained the reason for the sudden jump in energy rates.

Cold weather in late January and fuel supply issues in early February brought higher demand for natural gas used for heating and electrical generation, according to that publication. Both those events caused the cost of natural gas, which was already high due to winter pipeline constraints, to almost quadruple.

The price of power increased to more than 10 times its normal price, as systems had to rely on oil and diesel to operate generating plants. The Massachusetts Municipal Wholesale Electric Company is urging the Federal Energy Regulatory Commission to “reach beyond the traditional regulatory and financial model for building natural gas pipeline capacity” and fund new pipeline facilities.

Wind generation from the PMLD windmills can help offset prices, but it’s a matter of how much is produced and, more importantly, when it’s being produced, said Allen.

On a day in January at 6 p.m., the windmills were generating 430 kilowatts, but the price of energy was $780 per megawatt. “In February, because our windmills produced energy at exactly the right time (during peak periods), our energy costs will be less,” he said. Allen doesn’t think the light department will need the 3.5 cents that was on the last bill for the purchase power cost adjustment. “We’ll be able to reduce that on the next set of bills.”

Commissioner Donald Steadman suggested leaving a half cent per kilowatt hour on the bill in the future to put into a rate stabilization account to help if prices spike again.

“It may be a way to develop a reserve account with a half cent to see us pay a little at a time rather than a whole lot at once,” said commission chairman Scott Bigelow.

Allen reported that the department in the future may be able to utilize a code red reverse 911 system to let people know mid-way through a month that energy rates are going up, thus giving ratepayers the opportunity to try and conserve in advance. The message would go out via email, phone, cell phone or text message so people can decide on their own to conserve energy and save on their bill, said Allen. This would also allow the department to let people know about power outage situations, or if a road was closing for line repair, he said.

Bigelow said the school has a reverse 911 notifying system and wondered if PMLD could tap into that. “Why duplicate the same thing if we could add everyone in that system,” he said.

Allen said he’d advise commissioners when they could safely reduce the 3.5 cents charge on the light bills. Broadband proposal

Allen said he’s met with the Broadband Committee and vendors who wanted his input to make sure questions are being asked.

“For example, when the wind turbines were proposed we had to vote on what we saw, said Allen. “Some questions weren’t answered, such as what happens if the company doing the work goes out of business half way through the project. I’m involved. They want to go on our poles and they are very sensitive to that.”

Allen said Princeton has 82 miles of roadway and approximately 3,000 utility poles.

Leverett, the town the Broadband Study Committee is using as a model for getting high-speed Internet to every resident, is half the size of Princeton, half the population and half the road miles, and their utility poles are owned by Western Mass Electric, said Allen. “We need to understand what the costs are to do this and if it doesn’t work, can we still pay for it. We learned our lesson with the windmills,” he said.

The line from the Broadband Initiative would come into Princeton via Westminster up Mountain Road. Axia, the company working with the MBI, doesn’t take over until July, said Allen. The town would bill Axia for attaching to Princeton poles, he said.