Face the Facts: How Legislators Plan to Tackle Rising Electricity Costs

For weeks, we've known that our electric bills are going up.

Both Eversource and United Illuminating said the price of natural gas is the reason why.

Those hikes went into effect in January. This week, Governor Lamont announced more funding for certain families who need help paying their utility bills - but is that enough? Should we do more?

Sen. Norm Needleman, a Democrat from Essex, is the co-chair of the state's Energy and Technology Committee. He talks about how legislators plan to tackle rising costs.

Mike Hydeck: So the rate hike Eversource and UI customers are seeing right now, is it solely due to the price of natural gas on the world market? Or is there more at play?

Norm Needleman: I think that the price of natural gas is one of the main causes of it. I think the other problem has to do with the war and the volatility in the market that's created. And at the particular time that the buying was done for the standard service, there was a lot of volatility in the market, because no one knew what kind of winter it was going to be. So there were very few bidders at the window to bid when the utilities went out for standard service electric.

Mike Hydeck: And the natural gas, is purchased well in advance, right? That's a price on the market that was months ago.

Norm Needleman: It was. It's purchased over time. And as we've seen, even in the last month, as we see that so far, the winter hasn't been that awful, except for the week around Christmas. Prices of natural gas have certainly come down. Gasoline has come down, oil's come down. But the utilities have a buying plan to arrive at the standard service rate that they offer every six months through an adjustment on your bill. And when they went out to actually buy in this case, the rates for those, very few people actually wanted to take the risk. I think that one of the things that we plan on doing is looking at whether or not those, that particular buying plan, now that we know what happened in this particular case, impacted the bills so dramatically, what can we do to make sure that this doesn't happen again.

Mike Hydeck: To that end, there's a couple of things I'd like to ask you about. State regulators in Connecticut were trying to get together with officials from Massachusetts to try to look into anything they could do collectively, to try to have an impact on the price and hopefully bring it down. What came of that?

Norm Needleman: So I think it was a very productive conversation that was initiated by the Senate Democrats, in particular by the Senate Majority Leader Bob Duff. And I think that having the Massachusetts regulator and the Connecticut regulator there, there's limits to what they can coordinate. But at least if we're talking on the same page, we have a little bit better opportunity to understand exactly what happened. Their rates went up substantially. And Eversource, you know, is a provider in New Hampshire, Massachusetts, and Connecticut, but not all of Massachusetts. Some of the other rates in another part of Massachusetts went up even more. You know, there's a third-party market out there. People can always buy their electricity from one of the other providers. Historically, it seems like from the data that I've seen, that the standard service rate has, over time, provided the best rate, but that doesn't mean that it will always provide the best rates, so people have the freedom to choose. And that said, we're making a sacrifice right now. It's small consolation to the people that can't pay the bill. And that's why we're offering help. But we're making the sacrifice now, just like all of Europe is making a big sacrifice because of this war in Ukraine. And I think that doesn't help when you go to write, to check out for your electric bill. But we should all be aware that there is some shared sacrifice in standing up for what's right and fighting against the dictator who's just trying to overrun and take over another country.

Mike Hydeck: I don't think there's a lot of people that disagree with trying to stand up to a dictator. We get most of our electricity from gas-fired power plants and some nuclear as well. If we had other options, solar, wind, coal, more of a nuclear position, would we have more leverage on not having to buy so much gas? Isn't this a result of pushing people to switch from oil to gas years ago, and now we're stuck with just one source, basically? And how do we fix that?

Norm Needleman: Well, I think that that happened for a lot of reasons in the mid 2010s. And I think a lot of it was driven by the market and the price of natural gas became more cost effective than the price of even coal and oil. So the market did it. We incentivized it. I think that the way the whole market evolved was contingent on having a second pipeline coming through New York. That did not happen for a lot of reasons. Nonetheleast of which is New York wouldn't allow for it. But deploying more renewables, getting more Hydro Quebec online, getting this wind energy deployed, adding more solar, which we've authorized 2,000 megawatts of wind, 1,000 megawatts of batteries. And we've doubled the limits of solar in the state just in the last couple of years with an eye on more distressed communities, even for the solar. I think those are things that are going to all help, but they're not a quick fix.