Massive Rate Hikes Coming for National Grid Customers
Thursday, March 22, 2012
The British behemoth, which provides power to most of Central Massachusetts, racked up a record breaking repair bill during the massive, weeklong outages that followed Hurricane Irene and the freak October snowstorm.
The big bill amounts to about $100 for every National Grid customer, but the utility has yet to say exactly how they plan to recoup the storm costs other than in future rates.
And it’s a live wire issue in Worcester, which saw 30,000 residents stuck in the dark after or days after the October snowstorm and which has suffered for decades from periodic blackouts.
“We don’t understand it,” said City Councilor Philip Palmieri, who held a hearing on the blackout issue earlier this week. “There isn’t any question the costs continue to be overwhelming.”
The decision to tap customers, who already suffered through a pair of lengthy blackouts, has not gone over well with some.
National Grid and the state’s other big power companies have blamed extreme weather for last fall’s big blackouts.
But critics like Patrick Mehr of the Massachusetts Alliance for Municipal Electric Choice contend the costs were so high for the storms because the company hadn’t invested enough in everything from tree trimming to upgrading its electric grid.
That made its network of poles and power lines more vulnerable than they should have been when bad weather hit.
By contrast, a number small, town-owned utilities scattered across the state managed to get their lights back on in a matter of a few hours to a day or two after the big outages, Mehr has argued.
“It makes no sense at all to ask people to pay for that $120 million,” Mehr said. “If National Grid had been better prepared, it would have strengthened it decades ago.”
Worcester’s Palmieri is also skeptical.
Instead, he contends the company has not done enough to remove trees and limbs hanging over power lines, despite company claims to have ramped up their tree trimming efforts.
“Show us where,” Palmieri said of the tree trimming claims.
Federal stats also point to a larger blackout problem beyond freak storms.
There have been eight major power outages in Massachusetts since 2007, with winter storms being the major culprit, reports filed with the U.S. Department of Energy indicate. All involved the state’s major power companies.
That’s compared just two during the previous five year period, 2001-2006.
While National Grid has yet to say when it will seek approval from state regulators for rate hikes, company officials have made it clear that their customers will have to pay up.
The company has estimated its costs from the two storms as between $100 million to $120 million. The cost could fall heavily on Central Massachusetts, where National Grid is by far the lead power company. The company also controls the grid for a portion of Southeastern Massachusetts and parts of Western Massachusetts.
Deborah Drew, a spokeswoman for National Grid, downplayed the costs, saying the charges would be spread out over multiple years.
Drew was not able to offer a breakout of how many customers National Grid has in Central Massachusetts. However, she said the costs would be charged on a kilowatt per hour basis that would be the same for all the company’s 1.2 million customers in Massachusetts.
But Palmieri contends the company could cut down on its costs over the long-term by putting more money into Worcester’s aging power infrastructure.
He said he wants to build a partnership with National Grid to upgrade the city’s power infrastructure, with plans to hold a series of hearings on what can be done.
He plans to look closely as well as the bills the utility sends out and all the various charges.
“People want to know where the money is going and what they are using it for,” he said.
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