STATE REGULATORS on Tuesday approved raising National Grid’s monthly residential customer charge from $5.50 to $7 along with a yet-to-be-determined increase in the per-kilowatt distribution rate on residential customer bills.
On a gross basis, the rate increase amounted to $90 million a year. The increase, the first since 2016, will take effect November 1.
In a massive 586-page decision, the Department of Public Utilities approved a handful of initiatives to encourage electric vehicle usage in National Grid’s service territory as well as a performance-based method of adjusting future distribution rates.
The Baker administration agency rejected a $3 million grant program to help finance electricity infrastructure projects in the 15 Gateway Cities within National Grid’s service territory and a $50 million program to develop energy storage projects to relieve transmission bottlenecks in Westport, Ayer, and Rockport. The DPU also rejected incentive payments for National Grid if it succeeded in meeting various performance incentives, including reducing peak energy usage and promoting electric vehicle purchases.
The DPU decision said the rejected proposals, which would have been paid for by National Grid’s ratepayersk, were not well-thought-out or fully developed.
The electric vehicle measures that won approval were only a few of the ones put forward by National Grid. Those that passed muster included the creation of an advisory group to advice government agencies on how to shift to electric vehicles and a research effort to determine the best way to deploy electric vehicle fast chargers with energy storage systems and solar facilities.
The DPU also approved a special rebate program for power used to charge electric vehicles at off-peak usage periods. The goal of that program is to incentivize customers to spread out their electricity usage so the shift to electric vehicles will not overload the power grid.
The performance-based ratemaking initiative is an attempt to incentivize National Grid to continue making investments in the power grid even as electricity sales – and the utility’s revenues – trend downward.
“There is a fundamental evolution taking place in the way electricity is produced and consumed in Massachusetts. This evolution has been driven, in large part, by a number of legislative and administration policy initiatives designed to address climate change and to foster a clean energy economy through the promotion of energy efficiency, demand response, and distributed energy resources, and the procurement of long-term contracts for renewable energy,” the DPU said in its order. “To varying degrees, this evolution is changing the operating environment for electric distribution companies in Massachusetts.”
The DPU decision was handed down on the same day that the American Council for an Energy-Efficient Economy named Massachusetts the most energy efficient state in the nation for the ninth consecutive year.