DPU Cuts Proposed New Charges for Fitchburg Gas and Electric Light Company by Approximately 20 Percent
Decision also reduces revenue request by $1.4 million
BOSTON – Friday, May 30, 2014 – The Department of Public Utilities (DPU) today issued an order reducing the distribution rate increase Fitchburg Gas and Electric Light Company (Unitil) proposed for its 28,000 electric customers in the City of Fitchburg and the Towns of Ashby, Lunenburg, and Townsend. The DPU order reduces Unitil’s request by approximately 20 percent – from the requested $6.7 million increase to $5.4 million.
The DPU sets the distribution rates of electric utilities. It does not regulate the electric supply portion of the bill, which is a direct pass-through to customers.
Typical residential customers, using an average of 600 kWh of electricity per month, can expect a temporary increase in their total bill of approximately $12 per month, or slightly less than 10 percent, but only until January 1, 2015. The DPU decision maintains the continued reduction in the so-called “transition charge,” so that after January 1, customers’ bills should decrease by approximately 10 percent. The transition charge allows companies to recover certain costs associated with their required divestment of generating resources in the late 1990s.
The DPU determined that the company’s request for a storm fund would unduly shift the burden of storm costs to ratepayers, and rejected Unitil’s storm fund proposal. The DPU also rejected the company’s proposal to implement revenue adjustment mechanisms that would have increased its distribution rates on an annual basis.
“The department is conscious that every dollar counts to customers,” said Department Chair Ann G. Berwick. “Our decision minimizes the impact on customers, while ensuring that the company will receive sufficient revenues to maintain safe and reliable service.”
The DPU also provided benefits for ratepayers by allowing a smaller return on equity than the company proposed—9.7 percent instead of the company’s proposal of 10.25 percent.
The findings follow a ten-month proceeding that included one public hearing in Unitil’s territory, 10 days of evidentiary hearings, and review of more than 1,100 exhibits.
100 Cambridge Street, Suite 900, Boston, MA 02114-2119
617-626-1000 (office) / 617-626-1181 (fax)