Glenn Byron got a wake-up call when he opened his most recent electricity bill. It was $393.28, more than double the previous month.
In disbelief, the 80-year-old from Smithfield called Central Maine Power, but the charge was not from it. CMP referred him to Electricity Maine, one of the competitive electricity providers that serves as an alternative to the standard-offer price set by the Maine Public Utilities Commission.
Electricity Maine said Byron could get a reduced rate if he agreed to a new contract, paid the high charge and accepted a credit card refund, because it could not provide a refund through CMP. That is what he did.
“The fault is mine for not paying attention, but I can’t imagine a company would do this,” said Byron, a retired long-haul trucker and teacher.
He had never heard of Electricity Maine, and he did not read the second page of his CMP bill, which contains the charges for electricity supply. That charge more than tripled from $103 on the December bill to $315 last month, accounting for nearly the entire increase.
He figured there are many other Mainers like him who probably don’t concern themselves with all the small print. When his new one-year contract with Electricity Maine ends, he plans to cancel the plan. Policymakers and regulators are already on the case.
Byron complained to a lawmaker, Sen. Russell Black, R-Wilton, who normally does not receive many calls from constituents but said he got 10 on high electricity bills alone in the past week or so. People struggling to pay bills could have been tempted by lower initial prices from the competitive suppliers but forgot or didn’t realize that the prices would go up later when the rates became variable, he said.
“This is outrageous,” Black said. “We’re moving forward, and we’re going to find out what we can do for these people.”
A ratepayer advocate is taking it a step further, trying to turn residential customers away from the competitive electricity providers. In a report to the Legislature’s energy committee on Wednesday, Public Advocate William Harwood recommended that the company chosen by the commission for the standard offer-priced electricity be the only supplier to residential customers.
Competitive providers like Electricity Maine could continue to sell to commercial and industrial customers under this framework. The ratepayer watchdog based his recommendations on two reports his office commissioned to study options to reform the state’s retail electricity supply.
“The anticipated benefits of the competitive electricity market for residential customers … have not materialized,” Harwood said.
Harwood’s normal complaint volume of 100 calls per month tripled at the end of January with concerns over the high electricity bills, he said.
Electricity customers have the option to choose their own electricity supplier or use the supplier chosen through the commission’s competitive bidding process for the standard offer.
Most choose the standard offer, with only 7 percent of Bangor Hydro District’s customers choosing the competitive alternative and 12 percent of CMP’s customers. The steep price hikes for both types of suppliers are being blamed on natural gas supply disruptions caused by the war in Ukraine.
Standard offer electric rates rose about 40 percent for the average Versant Power residential customer at the start of the year and about 49 percent for the average CMP residential customer. Those increases prompted Gov. Janet Mills to push through heating aid, including $450 relief checks for most Mainers. But the increases were far more dramatic for those enrolled with competitive electricity providers like Electricity Maine.
Maine electricity customers have long paid more than needed on power from these companies, driven largely by predatory marketing, according to commission estimates. The activity has accelerated recently, with an estimated $175 million in excess charges in total from 2012 to 2020, according to Darren Fishell, a former Bangor Daily News reporter and data analyst who follows the pricing.
The Public Utilities Commission also is looking into options for easing supply prices. On Friday, it opened an inquiry into the rate structure for standard offer service and issues related to offering standard offer time-of-use rates.
The time-of-use rates would offer different prices for different times of day, for example, a lower price for running the dishwasher or charging an electric vehicle at nighttime rather than during peak daytime energy demand hours.
A spokesperson for Mills’ energy office said it is reviewing the public advocate’s recommendations and will work with him, the commission and the Legislature to address them.
Harwood said his office still is early in consolidating strategies to reduce electricity prices, but he is optimistic. If the standard offer provider becomes the exclusive supplier of residential customers, his consultants have noted that it won’t be necessary to worry about whether competitive suppliers are undercutting prices initially.
“We could do more creative things in rate design on the supply side, including time-of-use rates, and this would complement what the Public Utilities Commission has done on the delivery side,” he said.