Electric Rate Increase

Massachusetts Attorney General has announced --
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Series of Public Hearings throughout July 2009

Nantucket
July 7, 2009
7:00 p.m.
Nantucket High School

Worcester
July 8, 2009
6:00 p.m.
Worcester Public Library

Andover
July 9, 2009
6:00 p.m.
Andover Town House

Quincy
July 14, 2009
7:00 p.m.
Quincy City Hall

North Adams
July 15, 2009
7:00 p.m.
North Adams City

On May 15, 2009, National Grid filed a petition with the Department of Public Utilities (DPU) requesting an approximately $111 million increase in rates as of January 1, 2010. For residential customers, this is an 18% increase in distribution rates (5.5% for total bill). As the ratepayer advocate, my office represents consumers in matters involving the price and delivery of natural gas, electricity and telecommunication services before federal and state government regulators including the DPU. As such, my office has several major concerns with National Grid's recent filing.

Massachusetts already has some of the highest electricity rates in the nation and it is unfortunate that National Grid has chosen to propose such a significant electric rate increase that will further harm ratepayers during these tough economic times.

In response to this request, the DPU is holding public hearings (dates, times, locations at left) where legislators, municipal officials, and the general public can voice their concerns.

My office will represent ratepayers contesting the National Grid rate increase before the DPU. Evidentiary hearings will take place August 3 through September 4, 2009 with a DPU decision expected on December 1, 2009. In addition to attending the hearings, legislators, municipal officials, and the general public can submit written comments on National Grid's filing to the DPU by July 16, 2009. These may be submitted by mail to: 1 South Station, Boston, MA 02108, or by email to: dpu.efiling@state.ma.us and carol.pieper@state.ma.us.

As the ratepayer advocate I urge you to assist my office in challenging National Grid's rate increase.

Cordially,

Martha Coakley
Massachusetts Attorney General

Major Concerns with National Grid's Proposed Rate Increase:

National Grid is asking for a Return on Equity (return for shareholders) of 11.6%. This is well above what the Department generally allows and is excessive considering the other components of National Grid's filing;

Although National Grid wants more profits, the Company attempts to shift more risks onto ratepayers by requesting multiple cost trackers for: (a) Capital Expenditures; (b) Inspection and Maintenance Program; (c) Bad Debt and Other Uncollectibles; and (d) Pension and Other Post Retirement Benefits;

Instead of spreading the cost over numerous years, National Grid wants to recover $30,000,000 in one year from ratepayers that it spent restoring service after the December 2008 ice storm;

National Grid's decoupling proposal does not comport to DPU directives and serves National Grid's interests over those of ratepayers;

National Grid's proposed inclining block rate structure may harm some customers including low income customers; and

National Grid's proposed rate increase is in additional to other rate increases that customers in Grid's service territory are likely to see on January 1, 2010.