The majority of Versant Power customers who buy their home electricity through the state’s standard offer price will see a 40.7 percent increase in rates next year, the Maine Public Utilities Commission said Tuesday after choosing bids in a competitive process.
The higher rates for Bangor Hydro District customers come as electricity prices continue to skyrocket amid shortages and price hikes of the natural gas that powers the grid.
Last year, the commission approved an 89 percent rise in the standard offer rate for most Versant customers. About 93 percent of Bangor Hydro District customers take the standard offer, a company spokesperson said. The rate is 88 percent at Central Maine Power.
The commission will announce the standard offer price for the Maine Public District, which includes customers in Aroostook County and a small section of northern Penobscot County, as well as for CMP on Wednesday, commission Chair Philip Bartlett said.
“This news is not welcome and will be difficult for a lot of Mainers,” Bartlett said. “Our hope is that next year we will see some relief, but there’s no guarantee of that.”
Customers have the option to choose their own electricity supplier or use the supplier chosen through the commission’s competitive bidding process for the standard offer.
With the new standard rates in January, Versant’s residential customers in the Bangor Hydro District will see their standard rate rise from 11.68 cents per kilowatt hour to 16.44 cents. The district includes most of Penobscot County and Hancock, Piscataquis and Washington counties.
That amounts to a total bill increase for both the supply and distribution fees of close to 21 percent, or about $24 per month to $138.55 for an average customer using 500 kilowatt hours of electricity per month. The standard offer accounts for about 60 percent of the total customer bill.
The standard offer increase includes a charge of 1.5 cents per kilowatt to cover grid reliability.
Utilities do not set the rates for electricity supply, but they bill on behalf of their suppliers so customers get only one bill. The new rates will take effect on Jan. 1, 2023, and remain throughout the year.
The administration of Gov. Janet Mills has opposed electricity rate increases, with the Democrat asking her energy office to intervene to stop distribution rate hikes requested by Versant and CMP. The distribution rate is the other part of the electricity bill. It is requested by utility companies and approved by the commission.
Versant wants to raise its distribution rate by about 32 percent by next summer, a hike spurred by upgrades, technology investments and labor market pressures, the utility said in August. If the rate hike is approved by the commission, the average Versant customer could see their bill increase by about $13 per month, or $164 annually.
Mills’ energy office also has intervened on behalf of CMP customers to block a three-year distribution rate increase that would increase the average customer’s electricity bill by about $120 per year.
