COMMISSION SETS NEW STANDARD OFFER ELECTRICITY SUPPLY RATES FOR 2022 FOR VERSANT POWER STANDARD OFFER CUSTOMERS
November 16, 2021
Hallowell, Maine -The Maine Public Utilities Commission (Commission) accepted bids and set new Standard Offer electricity supply rates today for residential and business customers of Versant Power, Bangor Hydro District, as well as for large business customers in Versant's Maine Public District. Residential customers who receive standard offer service can expect an increase of about 88.6 percent in their supply rates effective January 1, 2022. The new residential standard offer price amounts to an increase of about $30 per month on the total bill for an average customer using 550 kWh/month, or an increase from about $101 to about $131.
The new Standard Offer supply rates were set though a competitive bid process conducted by the Commission, as required by Maine law. The increases reflect prevailing energy market conditions, including those in the regional electric power market in which prices are strongly influenced by natural gas.
These increases apply to customers who do not purchase electricity from a competitive supplier of their choosing and instead receive Standard Offer Supply by default. Standard Offer Suppliers for Versant Power-Maine Public District Residential/Small Business Class and Medium Business Class were awarded multi-year contracts in 2019. Those prices will be calculated and released next week.
"These prices are competitive and provide the best value for Versants Standard Offer customers," Chairman Philip L. Bartlett II said. Unfortunately, sharp increases in natural gas prices are resulting in higher electricity supply costs for the upcoming year. This increase is primarily driven by New Englands wholesale electricity market prices which have increased dramatically.
The new Standard Offer electricity supply rates reflect a similar trend experienced in other energy sectors as well. The table below shows how the Standard Offer price increase compares with increases in natural gas, oil, and wholesale electric markets during the same month the previous year.
Natural Gas 94.80% Increase Oct. 2020-Oct. 2021
Heating Oil 121.70% Increase Oct. 2020-Oct. 2021
Wholesale Electricity 126.3% Increase Nov 2020-Nov 2021
Standard Offer 77% Increase Nov 2020-Nov 2021
Those having difficulty paying their electricity bills are encouraged to explore options for financial assistance. A full list of programs is available on the Commission website.
Multiple bidders submitted sealed proposals in the Commissions annual competitive process for setting Standard Offer electricity supply prices. The Standard Offer supply amount accounts for about 50 percent of the total customer bill. For Versant Medium Business Customers, the new prices vary by month, averaging 11 cents per kWh. Versant medium-class businesses will see an average 77.7% increase annually in the supply portion of their bill.
Prices for Versant large business customers will be indexed to market prices and set in advance of each month. The names of the suppliers selected for Versant will be released in two weeks, allowing time for power supply arrangements to be finalized.
For more information on standard offer service prices visit: https://www.maine.gov/mpuc/regulated-utilities/electricity/electric-supply
Background An electric bill includes two components: electricity supply and delivery. The Standard Offer Supply Rate is just one component of the total electric bill.
When the electric industry restructured in 2000, utilities were required to sell their electricity generating assets and therefore no longer supplied the electricity. They do, however, maintain the infrastructure that delivers the power to your home or business. That includes substations, large transmission lines, distribution lines, utility poles and meters that connect to homes and business.
Since the law was changed in 2000, electric customers have had the option of choosing their own electricity supplier or using the default supplier, which is the supplier or suppliers chosen in the competitive bidding process for Standard Offer Electricity Supply conducted by the MPUC. Maines electric utilities do not set the rates for electricity supply, they simply bill on behalf of the suppliers so that customers do not receive two bills.
About the Commission The Maine Public Utilities Commission regulates electric, telephone, water, and gas utilities to ensure that Maine citizens have access to safe and reliable utility service at rates that are just and reasonable for all ratepayers, while also helping achieve reductions in state greenhouse gas emissions. Commission programs include Maine Enhanced 911 Service, gas safety and Dig Safe. Philip L. Bartlett, II serves as Chairman, Randall Davis and Patrick Scully serve as Commissioners.
Learn more about the Commission at www.maine.gov/mpuc
CONTACT: Susan Faloon, Media Liaison CELL: 207-557-3704 EMAIL: susan.faloon@maine.gov
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