State regulators approve Rhode Island Energy’s proposed summer electric rates

Summer electric savings are around the corner, under new rates for Rhode Island Energy customers approved by state regulators this week.

However, gas bills are expected to rise under a separate long-term infrastructure plan also approved by the Rhode Island Public Utilities Commission. The three-member panel in a daylong meeting on Tuesday authorized a slew of rate and fee changes that will affect Rhode Island Energy customers’ gas and electric bills starting April 1.

Updated documents submitted by the company to regulators Thursday detail how the approved rates and fees will affect customer bills.

Among the most significant changes is the default electricity supply price, known as last resort service rates. The 8.91 cents per kilowatt-hour price, reflecting what Rhode Island Energy will pay to procure electricity from suppliers in the marketplace, marks a 43% decrease over current winter prices. 

The six-month, summer rates last through Sept. 30. 

For an average residential customer using 500 kilowatt-hours of electricity per month, the proposed rate change translates to a savings of $39.68 a month. However, the actual monthly bill also includes extra charges to help fund the company’s renewable energy program and capital infrastructure projects, among other fees.

Taking these other charges into account, residential customers would still see a (slightly smaller) monthly savings on electric bills, equal to about $31.39 saved per month, a nearly 19% savings on what is now a nearly $168 monthly electric bill, according to the updated filing.

Commercial and industrial customers would also see bills affected by the new supply prices and other fee changes, although the amount and percentage decrease depends on their usage and type of operation.

Further bill reductions may be around the corner for at least some of the 500,000 Rhode Island Energy electric customers through what is known as the “adjustment factor.” The annual fee is intended to recoup money from undercollection in the prior year, or in the case of a surplus from overcollection, refund that money to customers. Rhode Island Energy reported over collecting about $24 million last year, but has yet to dole out the refunds amid ongoing discussion with state regulators over who should receive the refunds, and how to show that on customers’ bills. 

Further details on the impact of refunds are expected by July.

Meanwhile, gas customers will see their annual bills rise by $77 based on the company’s $191 million gas, safety, and infrastructure reliability plan for fiscal 2025, which starts April 1, along with a separate $12 million budget for road repaving projects. The spending requires the company to collect $83.9 million in revenue from customers, corresponding to a $77 annual bill increase for the average residential heating customer using 845 therms of natural gas, according to updated calculations submitted to state regulators Thursday.

Commercial and industrial customers would also see bills affected by the spending plan, although the amount and percentage increase depends on their usage and type of operation.

Customers in seven municipalities — Barrington, Central Falls, Narragansett, Newport, Portsmouth, Providence, and South Kingstown — can also opt out of the Rhode Island Energy electric prices, instead participating in a community aggregation plan that leverages bulk buying power to secure lower-priced electricity for its residents.

Summer electricity prices for the state’s community electricity aggregation plan, which take effect May 1, were unveiled by the city of Providence on Thursday, with rates ranging from 10.1 cents per kilowatt-hour to 13.5 cents per kilowatt-hour based on the percentage of electricity from renewable sources included. At least two of the options are less expensive than the rates approved for Rhode Island Energy customers, which total 10.38 cents per kilowatt-hour when administrative costs are added to the base supply price.