Statehouse Headliners: As cost of making power drops 33%, NE consumers still pay highest rate in US

By Guy Page

New England grid power generation will grow more carbon-intensive due to the May 31 closure of Pilgrim Nuclear power station in Plymouth, Mass. Furthermore regional power costs, already the highest in the continental US, seem unlikely to decline.

That was this observer’s takeaway from the ISO- New England Consumer Liaison Group quarterly meeting today in Westboro, Massachusetts. The quarterly meeting attracts electricity consumers, generators, regulators and advocates from across New England.

New England lost 680 carbon-free megawatts when Pilgrim closed, according regional grid operator ISO-New England. It added 1050 MW in new fossil fuel generation and 140 MW in new solar and wind power, for a net loss of 230 MW of carbon free power.

ISO-New England report for June 2019 Consumer Liaison Group meeting

Future power generation for New England leans heavily on high-cost, low-carbon wind, solar and battery power.

Grid planners say wind, solar and battery power comprise about 85% of planned future New England megawatts. This power is clean and emissions-free but is way more expensive than power now sold on the open market in New England — already the most expensive region for electricity consumers in the continental United States. Every New England state is among the top 10 most expensive. Consumers want to know: why is that?

The real cost driver isn’t the cost of the electricity itself — yet, anyway.

Between 2014-2018, the cost of wholesale electricity purchases from generating plants dropped by 33%. Good news, right? Thank you, ultra-cheap hydro fracked natural gas.

But that’s not the whole story. The work of transmitting that power cost consumers $2.2 billion (up 20%). Grid operators cite long-delayed improvements to enhance safety and reliability.

It gets worse. Closure of plants like Vermont Yankee and the opening of new “intermittent“ renewable power plants force regional grid operators to pay through the nose for “capacity charges.” In effect, consumers must pay power companies to keep generation available for emergency use. Like any convenience store product, capacity power is often unhealthy and always expensive. New England consumers paid $2.6 billion more in capacity charges between 2014 and 2018.

Utilities and state governments add on operating, tax and energy efficiency costs to that 9.5 cent/kilowatt-hour wholesale power price. Investment of those energy efficiency fees has driven peak power cost down. Still, the average Vermont consumer power rate is about 17 cents per kilowatt hour, compared to about 11 cents nationwide.

So when you wonder why Vermont and the rest of New England pay so much for electricity, don’t blame the power makers — the natural gas companies, anyway. Look at the middle men — the grid operators that must provide reliable power, utilities that must distribute the power and maintain the local power lines, and above all state governments that legislate for renewable power, energy efficiency, and taxes.

Statehouse Headliners is intended primarily to educate, not advocate. It is e-mailed to an ever-growing list of interested Vermonters, public officials and media. Guy Page is affiliated with the Vermont Energy Partnership; the Vermont Alliance for Ethical Healthcare; and Physicians, Families and Friends for a Better Vermont.

Images courtesy of Wikimedia Commons/Harvey McDaniel and ISO-New England report
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18 thoughts on “Statehouse Headliners: As cost of making power drops 33%, NE consumers still pay highest rate in US

  1. We continue to pay more because we are also picking up the tab for Vermont’s low life , illegal alien, and indigent population……. because we love them.

    • OH, and it’s not the utility companies that are at fault. If you stop and think what you get for what you pay TO THE COMPANY ITSELF……you are living large. It’s the TAXES!!!

  2. Thé NE wholesale price has averaged about 5 c/kWh since 2008, i.e., 11 years, yet VT household electric rates have increased about 14%, because of high solar feed-in tariffs, up to 30 c/kWh, and high net metering of 18 c/kWh paid to solar owners, plus 3.5 c/kWh for various GMP management costs, for a total of 21.5 c/kWh.

    In addition ISO-NE imposed network charges have increased, and ISO-NE imposed forward capacity charges have increased.

    Then there are the various expensive battery boondoggles, the costs of which are discussed behind closed doors during rate increase discussions, which should be open the public.

    VT need glasnost and perestroika

  3. Thank you True North Reports for your continued, informative reporting.
    Now, we the people need to put the people making the policy in Montpelier out of business.
    Every town in Vermont used to have hydro-powered something and we need to get back to it. Towns were built on a river for that reason.
    The “no nukes” protesters of the 60s are now running the show, that is obvious! Nuclear and hydro-power are the third leg of the stool and we need to bring them back or we’ll all freeze to death in the dark.

  4. This is all by design, as has been pointed out. Get rid of nuclear, (VT Yankee was ok’d by the Feds for another 20 years), we can’t control the petroleum based business so we’ll fix it so they will pick up their wares and move elsewhere. You know, maybe some of us will go along with them.
    The planners design energy plans for each town/city to fit the Shumlin/Socialist mold, it gets approved by the process and whamo, we’re in, the planners move forward with their agenda(s) as though it was business as usual.
    Freezing to death in a dark room is not an option for this ol’ boy.

  5. And yet we still sit out here in the audience, like trained chimps, watching this troupe of socialists ply their craft as we keep paying our admission fee. And all we have to do for a new act is convince enough chimps the show isn’t worth the cost and choose someone else!

  6. If I recall correctly, at 1 point we had a portion of our electric bills
    sourced from hydro quebec? The so called “NYPA block” Back in the 80s? Vermont Public Service arranged it but at some point the courts here in Vermont Killed it.

  7. Yeah….where is that hydro? It’s reliable and powerful. And CHEAP. There is no better word for it. CHEAP.

    But no. Our legislators and the army of lobbyists and David Blittersdorf types that work on them daily in the statehouse are more concerned with getting THEIR plan in place. Doesn’t matter that their plan will buckle the legs of the common man under the increasing weight of more and more foolish, self serving mandates.

    We don’t do what’s right for the masses anymore. We do what’s best for the few, connected, hippie elites in the statehouse.

  8. Would someone please tell me what happened to all that cheap Hydro Quebec power that is renewable and closer to us than any other power source?

  9. The power company has never ever told it’s electric consumers just how much of their bill is because of the subsidies that they pay for solar and wind and they never will because if you knew how much you would crap your pants

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