Electric rates to increase due to high cost of natural gas

Electric rates for the winter are going up a lot, and two utilities have announced rate hikes that take into account the dramatically higher cost of natural gas: Unitil and the New Hampshire Electric Co-op. 

Unitil’s winter rates will be a 60 percent increase for a household that uses around 650 kWh per month, while the New Hampshire Electric Cooperative customers can expect a 17 percent increase compared to summer rates.  

In both cases, the reason for the dramatic increase in the cost of electricity is tied to the spike in the cost of natural gas. 

Unitil customers who used to pay $112.47 on their bill, for example, can now expect to pay $180.75, according to an order from the Public Utilities Commission on Friday authorizing the increase. The new rate, 17.5 cents per kWh for residential customers, will go into effect on Dec. 1.

The price of natural gas is at the highest it has been in seven years, according to CNN. In just the past year, the cost of natural gas has increased 180 percent. Since natural gas is used both for heating homes and for generating electricity, the cost of natural gas could continue to increase if it’s an unusually cold winter. And it may place an additional strain on low- and moderate-income residents of New Hampshire who heat their home with natural gas. 

“As the price of natural gas has risen over the past several months, so has the cost to purchase electricity to serve our members. We know this increase will be difficult for our members, as it will be for electric and gas customers throughout New England,” said Brian Callnan, the co-op’s vice president of power resources and access, said in a written statement on Thursday when the increase was announced.

The nonprofit said the 17 percent increase in rates is a result of a spike in the price of natural gas. For the typical residential customer, the increase will translate to an additional $17.19 per month when the new rates take effect on Nov. 1.

The cooperative last increased rates – which are a direct pass-through to its members – in May, but that was just a 1 percent increase. The current summertime rate of 6.5 cents per kilowatt-hour will go up to 9.8 cents.

Eversource and Liberty Utilities, the two other main electric utilities in the state, last raised their rates at the end of June. Unitil raised rates about two months before the other two major utilities. Winter rates for Eversource and Liberty have not yet been approved by the utilities commission.