PUC approves electricity rate hike after contentious hearing

WARWICK, RI — State regulators on Friday approved one of the biggest power rate hikes in decades in the face of vocal opposition from advocates, community members and several elected officials.

The Rhode Island Public Utilities Commission, which regulates all utilities in the state, unanimously passed the 47% electricity rate hike proposed by Rhode Island Energy. Under the new rate, which will take effect on October 1, households will see their bills increase by an average of $50.76 per month.

A proposed hike in gas bills, which has yet to be reviewed by the PUC, would see an increase of around 15% from November.

PUC Chairman Ron Gerwatowski, who at one point temporarily suspended the meeting due to protests from the crowd gathered in the courtroom, informed the public that it might not be about the latest increase in utility prices.

“I hope everyone understands that we’re looking at a future in choppy waters, not just for this winter,” Gerwatowski said, “but the markets and the price of electricity in this region where we get our electricity from. are volatile and I think we’re going to face a lot of challenges in the region and here in Rhode Island.

Advocates from the George Wiley Center, the Poor People’s Campaign, the Sisters of Mercy and the RI Coalition to Reduce Poverty gathered for the second time in as many weeks Friday morning to protest Rhode Island Energy’s steep rate hike .

The mood on the steps of the PUC building took on the tenor of a stimulus meeting, as speakers implored the commission to deny the rate hike. Priests, organizers and community members invoked the scriptures, sang songs and chants and warned officials of the poverty that would ensue due to new utility bills.

“I don’t think the people in this room have heard us or understand the domino effect this will have,” said Pamela Poniatowski, an organizer with the Poor People’s Campaign. She continued, “The only way some people have the money to pay for this is to win the lottery.”

Utilities are overseen by the state Utilities Commission, which approves or denies proposed increases in utility rates. Chairman Ronald Gerwatowski and Commissioner Abigail Anthony await the start of Friday’s meeting. (Rob Smith/ecoRI News)

Warren resident Debbie Krauss told the crowd how expensive it was when her home had a power outage, estimating the value of spoiled food in her chest freezer at more than $500. “I didn’t want to lose the contents of my chest freezer and the freezer attached to it, and it happened every time [we lost power]. How about you pay me back first, how about that? »

Activists had gathered the previous week to testify to commissioners that people would have to choose between heating and electricity or other basic necessities like food, medicine or rent if the new tariff were approved.

Utilities justice advocates are calling for reform, demanding that the PUC cut Rhode Island Energy’s profit margin from 10% to 6%. They also demanded a Percentage of Income Payment Plan (PIPP), where low-income residents can pay a certain percentage of their income for their electricity bill instead of a flat rate, and for the commissioners to reject the rise.

“It’s the Public Utility Commission, not the Corporate Utility Commission,” said Rep. David Morales, D-Providence.

Protesters entered the building around 11:30 a.m. on Friday, shortly after commissioners began their meeting to vote on electricity rate hikes. As commissioners began the formal process of voting on their agenda, campaigners broke off the meeting, chanting for no further rate hikes. The meeting was quickly suspended, while protesters expressed their concerns, sometimes forcefully, to the remaining commissioners, John Revens and Abigail Anthony.

The commissioners stressed to the crowd that they were ultimately limited in their powers to reject the hike. Revens said opposing parties during the evidentiary process agreed that the utility acted correctly when formulating the new rates.

“They don’t buy [electricity] like when you go to the grocery store,” Revens said.

Gerwatowski restarted the meeting around 12:20 p.m. Police escorted half a dozen protesters for continuing to disrupt the meeting but made no arrests. Morales was taken away twice, the second time shouting “shame” to the commissioners.

Rhode Island utilities do not make a profit selling electricity to ratepayers. Under state law, the utility must supply electricity at the prices it paid—it legally cannot make a profit from the sale of electricity; the costs are passed on to the electricity and gas tariffs themselves.

Profit is instead made on the construction of new infrastructure such as power lines, natural gas lines or the connection of new gas lines in homes or businesses. The PUC defines what that profit can be every three to eight years.

The utility also offers rate changes twice a year, for summer and winter, with summer rates usually being cheaper than winter rates, due to lower electricity demand and gas.

Applying rate changes every six months provides some protection against natural gas price volatility, because although only about half of the state has a natural gas line for winter heating, all electricity subscribers primarily use natural gas. According to ISO-New England, the non-profit association that manages the Northeast’s electricity grid, 54% of all the energy consumed in the region comes from natural gas plants.

Rising natural gas prices – whether from supply shocks resulting from the Russian invasion of Ukraine or from increased global demand for the fossil fuel – drive up electricity.

Rhode Island Energy’s parent company, PPL Corporation, reported second-quarter earnings of $119 million in August and will pay a small quarterly stock dividend in the fall.

On Friday, commissioners approved relief for low-income taxpayers. The PUC gave Rhode Island Energy the go-ahead to distribute $32.5 million in electric bill credits and an additional $17.5 million in gas bill credits. The credits were part of the multimillion-dollar settlement agreement reached between the attorney general’s office and the PPL Corporation before it could purchase Rhode Island’s utility assets from National Grid. Invoice credits should be applied by the company in November or December.

The PUC also approved Governor Dan McKee’s allocation of $3.8 million in Regional Greenhouse Gas Initiative (RGGI) funds to provide relief to low-income taxpayers. The governor estimated the funds would provide direct tariff relief to 39,000 Rhode Islanders.

“We have effectively eliminated the impact for our most vulnerable constituents, and they will see no increase in their overall electricity bills compared to last winter,” the governor said in a statement.

Earlier this month, Rhode Island Energy got the green light from state regulators to write off more than $47 million in arrears. The cancellation of utility debt was another part of the attorney general’s settlement with PPL, and the company plans to credit customers whose accounts were 90 days or more past due in October.

Activists are not discouraged. “When the [legislative] session starts in January, we need to increase the pressure to pass the payment plan as a percentage of income,” said David Veliz, director of the RI Interfaith Coalition for Poverty Reduction.

The new electricity rates come into effect on October 1. Proposed natural gas rates for the winter have not yet gone through a hearing, but are expected to take effect Nov. 1.


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