Press-Republican

Local News

January 15, 2014

Power bills skyrocket

REASON: Natural gas, polar vortex blamed for rate hike.

(Continued)

ELIZABETHTOWN —

Contacted by the Press-Republican, National Grid spokesman Patrick Stella said the company sold its plants years ago and now gets its power from the Independent System Operator, which operates a network in which power-plant owners continuously bid the prices they want for their power.

“The supply side has gone up since November (2013), anywhere from 45 to 55 percent,” Stella said.

“That’s market price, driven by many different things, if there’s been higher usage. Natural-gas costs have gone up. When natural-gas prices go up, rates go up. If there’s more usage, you will see an increase.”

BIG FREEZE HURT

During the polar-vortex-generated cold spell, New York state set a record for electricity usage, as demand went to 25,738 megawatts on Jan. 7. The previous winter-demand record of 25,541 megawatts was set Dec. 20, 2004.

Stella said electricity delivery rates had dropped about 10 percent since March 2013, when National Grid got permission from the Public Service Commission for the decrease. Those rates had decreased another 10 percent in January 2012.

“Although National Grid does not control the supply side of the bill, the portion of the bill National Grid does control, the delivery portion, has decreased nearly 20 percent in the past two years as a result of the company’s efforts to stabilize energy costs for its customers,” Stella said.

The delivery rates are what National Grid charges to own and maintain the infrastructure that delivers the power to the customer’s home or business.

NATURAL GAS PRICE

Some power plants burn natural gas to generate electricity, and those costs went up, New York Independent System Operator spokesman David Flanagan told the Press-Republican.

“The main driver here is the price of natural gas. The price of natural gas and the price of electricity track each other. When you get into the winter months, you have competing demands for that gas, and the price will go up. There are are higher demands from utilities and customers.”

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