The majority of Versant Power customers who buy their home electricity through the state’s standard offer will see an 89 percent increase in their rates next year, the Maine Public Utilities Commission said Tuesday after picking bids in a competitive process.
Residential customers in the Bangor Hydro District — which includes most of Penobscot County as well as Hancock, Piscataquis and Washington counties — will see their power supply rate skyrocket from 6.2 cents per kilowatt hour to 11.68. That is an increase of $30 a month and $360 a year for the average customer using 550 kilowatt hours per month, Public Utilities Commission Chair Philip Bartlett said in a meeting Tuesday.
The new rate is the result of an increase in the price of natural gas, which has driven up wholesale electricity prices regionally, Bartlett said. He noted that Maine’s electrical supply was not regulated, but determined through a competitive marketplace where prices can quickly flip.
The power supply portion of customers’ bills is separate from the cost they pay to the utility to maintain its distribution network.
“In some years, like the last two, we have benefited from market conditions resulting in lower prices,” Bartlett said. “Unfortunately, this year the reverse is true.”
Energy prices have surged nationwide in recent months after dropping significantly amid the economic downturn from the COVID-19 pandemic. Those same factors could lead to increased rates for Central Maine Power customers when the Public Utilities Commission announces its awards for bids for that company on Wednesday.
Medium-class customers in the Bangor Hydro District will see a 77.7 percent increase in standard offer prices. Large-class customers in the Maine Public District, which includes customers in Aroostook County and a small section of northern Penobscot County, will see a 66 percent increase in standard offer prices.
Calling the price rise painful, Commissioner Patrick Scully recommended that buyers look at other suppliers in the marketplace as an alternative to standard offers so that they can find a cheaper rate.
“The size of the increase is terribly unfortunate and it’s going to impact a lot of people fairly negatively,” Scully said.
The new power supply rates take effect Jan. 1 and will remain in effect for 2022.