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The Real Deal: Electric Rates Double
ALBANY - If you've opened up your National Grid bill this month and experienced a bit of sticker shock, you're not alone. The supply cost of electricity has more than doubled for many customers this month, compared to last. From November to December of 2013, the statewide wholesale price of electricity increased by 53% and when a utility has to pay more for it, you can bet its going to be passed right on to customers.
When Lecia ODell opened her National Grid bill a few days ago, she was shocked, I thought there was a mistake, I thought they couldn't have read the meter, that something was wrong, they said, no they read the meter, she says. Turns out the bill was correct and it was big, It had almost doubled, the kilowatts from this month to last month, she says of the cost per kilowatt hour as it appeared on her bill, It was just unbelievable, $225 compared to $95, it's almost triple, ODell adds. Even compared to the same time last year, the price was double.
When it comes to the supply side of your utility bill, believe it or not, National Grid doesn't have much say as to how much it charges. The utility buys electric through the States Independent Service Operator. We don't mark that supply cost up, it's basically a pass-through that comes through our bill into the customer's so we don't have any control over that supply we only purchase it on behalf of our customers, says Patrick Stella, a spokesman for National Grid.
The ISO says because New York relies on natural gas to fuel its power generating stations, the price of electricity is directly tied to the price of natural gas. In cold weather, the demand for gas shoots up and so does the price because the transmission lines get congested. Homes and businesses need the gas to heat and power plants need it to produce electricity and the Capital Region doesn't exactly have a prime spot along those lines. New York State does have some long-standing constraints on our transmission system so that generally prices to our west and north are lower because you have lower cost generating resources, hydro plants to the west, a lot of wind in the north, says David Flanagan, a spokesman for the New York Independent System Operators.
The only upside to energy pricing at this point? We had a new rate case that went in last year and that actually decreased the delivery rates right now by 10%, so the part we control has actually decreased, Stella says. The only question of course, is for how long, You're not expecting it to be that much and so it's an extra $120 that you have to put out, we can pay it but it's just ridiculous and I'm worried about what next month's going to be, ODell says. And thats really something to keep in mind, the subzero days and nights we've experienced recently will show up on next months bill. Even if you always keep the thermostat at 65 degrees, when temperatures dip down into the single digits and below zero, your furnace needs more energy to keep you warm.