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Norwich utilities commission approves three-year rate plan

Norwich — The utilities commission Tuesday approved a three-year rate restructuring plan that calls for setting three years of rates for all four utility services starting each November, but with rate increases only for sewer usage in the first year.

The Board of Public Utilities Commissioners/Sewer Authority heard a presentation on the restructuring and rate changes prior to the vote.

The restructuring plan was proposed after an 18-month cost of service study conducted by Utility Financial Solutions LLC. For each of the four NPU services — electricity, natural gas, water and sewer — proposed rates were based on the actual cost of providing the services to residential, commercial and industrial customers. The plan also eliminates the separate capital tracker, a charge that covers capital improvements, and rolling it into monthly use charges.

There are no proposed rate increases in 2020 for electric, water and natural gas, while the Sewer Authority approved a 6% increase in sewer rates starting in November 2020.

However, prior to the vote on the rates, board member Michael Goldblatt complained that the rate presentation on natural gas was misleading because NPU anticipates an increase in the purchase price for natural gas in January. The price of natural gas is expected to rise worldwide in the coming months. That cost would be passed onto customers as the “purchased gas adjustment” in the monthly bill.

“I don’t want to say there’s no increase in gas,” Goldblatt said. “There is an increase in gas.”

For electricity, NPU customers will have no rate increase for 2020 for the third straight year. Electric rates will increase by 1.5% starting in November 2021 and by 1.5% in November 2022. Natural gas rates also will not increase in 2020, and will rise by 2.3% starting in November 2021, and again by 2.3% in November 2022.

Sewer rates will increase by 6% per year for each of the three years covered by the proposal, starting in November 2020. There will be no increases in water rates for the next three years.

For customers with all four NPU services, the average monthly bill will rise by $3.76 this year, about 12 cents per day, according to figures provided by NPU. In the second year, the average bill will rise by $8.32 a month, or about 27 cents a day, an increase of 2.5%, and in the third year, the average increase would be $9.23 a month, or about 30 cents a day, an increase of 2.7%.

A presentation to the commission in August showed that NPU sewer costs would be highest in the region at a monthly bill of $66.61 for 5,000 gallon per month. By comparison, the monthly bill for Groton Utilities for 5,000 gallons per month was $45.50 in July 2020.

NPU’s electric rates were comparable or slightly higher than other municipally owned utilities in the region at $118.95 for 600 kilowatts per month, with Groton Utilities at $98.63, Jewett City Department of Public Utilities at $110.40 and Bozrah Light & Power at $118.96. A monthly Eversource bill for 600 kilowatts per month is $144, the presentation showed.

An NPU water customer’s monthly bill of $50.50 falls roughly in the middle of the region’s water services, and NPU’s natural gas bill of $109.63 is lower than Yankee Gas’ monthly charge of $126.50 for the same usage.

c.bessette@theday.com

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