Opposes Rate Hike
It is no secret that we are living in the most challenging economic times since the Great Depression. Families have had to make every dollar stretch further than ever before, and for many people, the essentials of life have become harder to attain. Yet in the midst of this recession, National Grid, the electric company that serves East Longmeadow, is seeking to increase residents' energy bills by over five percent.
Not only is this rate increase ill timed, National Grid's request presents a number of concerns about how the rate increase, if approved, would be spent. Among the most disconcerting is National Grid's request to increase its "return on equity" to 11.6 percent. Plainly, this would build an 11.6 percent profit margin for shareholders into each rate-payer's bill. It is wholly unacceptable in today's economy to expect struggling families to provide increased profits for National Grid and their shareholders.
While looking to increase guaranteed profits, National Grid is also seeking to shift its risks onto the same ratepayers, including pension and other post-retirement benefit costs, capital improvements and bad debt from ratepayers who already cannot afford their electricity costs.
Finally, National Grid is looking to recoup from ratepayers the $30,000,000 it spent restoring service in the wake of last year's ice storm in one year. It would be far more equitable for the electric company to recoup these funds over the course of multiple years, which would not be as burdensome on ratepayers.
As National Grid makes its case to the Department of Public Utilities, which oversees rate increase requests, I am joining with Attorney General Martha Coakley and many of my colleagues in opposing this poorly timed and ill conceived request. National Grid will already be increasing rates over the next year for energy efficiency upgrades and renewable energy investments. It is simply unfair to ask residents for an additional, and significant, rate increase without having a very compelling reason; suffice to say, buffering National Grid's profits does not come close to meeting that threshold. As this issue unfolds, I will continue to advocate on behalf of the residents of East Longmeadow to help ensure fair and equitable electricity rates.
Sen. Gale D. Candaras
First Hampden & Hampshire District