Electric prices are going up, but advocates say there's another way

·5 min read

Jul. 31—Higher electricity prices began today for customers of Eversource and Liberty Utilities — but with those rising prices, and new draft regulations potentially opening the door to "community power aggregation," more Granite Staters are thinking about whether the "default" electric service is still the way to go.

Nearly all New Hampshire households use "default" electric service, according to the state Department of Energy — the Eversource, or Liberty or New Hampshire Electric Cooperative service that comes standard. Just 14% of households in the Eversource coverage area use an alternative supplier, according to the state Department of Energy.

Most people just don't have the time to shop around for electricity, said state Consumer Advocate Don Kreis.

Since 1996, when New Hampshire restructured electric service to decouple electric suppliers from utility companies, New Hampshire residents and businesses have had the option to get off their "default" service and sign up for "alternative" electric service with a wholesale supplier.

This summer, with news of significantly-higher prices for electricity, many have started investigating alternative electric suppliers. People are sharing information, promotional codes and sign-up incentives on local social media groups.

Alternative suppliers

The state offers a comparison-shopping tool on the New Hampshire Department of Energy website (www.energy.nh.gov/engyapps/ceps/shop.aspx), said Amanda Noonan, director of the Consumer Services Division of the Department of Energy, and other information about suppliers.

"Educate yourself," Noonan said. "It's just like when you buy anything else: know what you buy before you buy it."

Noonan said consumers should keep an eye out for the length of a contract, whether the price is a fixed rate or a variable rate, and fees for ending the contract early.

She also said it's important to renew, get a new contract or revert to default service by the end of a contract — suppliers typically bounce customers to more-volatile variable rate contracts at the end of a contract term if they don't take action, she said.

Kreis, the consumer advocate, said this might be a lot to expect from most New Hampshire residents.

"Residential customers are risk-averse and they're busy," Kreis said. "Who wants to think about their utility bill all the time?"

As of June 30, very few people wanted to think about their utility bills all the time.

Just 14% of residential customers in the Eversource service area use alternative suppliers, Noonan said, but alternative energy suppliers are much more commonly used by bigger businesses.

More than 80% of medium-sized commercial customers use an alternative energy supplier, with nearly 90% of the largest commercial customers using an alternative supplier.

Larger businesses seem to be able to negotiate better rates with electricity wholesalers, Kreis said. While households have a set menu of options for energy, Kreis said the largest entities — think BAE, Anheuser-Busch, SigSauer, or big hospitals like Dartmouth Health — can negotiate a rate with wholesalers, and get a truly good deal.

A single household doesn't have that kind of sway, and can't get the same rates as a giant entity.

"The benefits of restructuring have almost completely eluded residential customers so far," Kreis said. "My hypothesis is community power aggregation might be the way residential customers finally get the benefit of restructuring."

Another model

Advocates of an arrangement called "community power" hope their model could give households and small businesses that same clout big businesses have by banding together.

"They'll be that large a purchaser that they'll get attention in the wholesale market," Kreis said.

The New Hampshire Community Power Coalition, made up of 19 cities and towns including Lebanon, Portsmouth and Nashua, is working to establish an arrangement where a city or town could negotiate rates and types of energy supply — such as pushing for more renewable energy sources — for all its residents, though residents could still opt out of the deal.

Community power took a major step forward last week, when the Public Utilities Commission released draft guidelines for setting up a community power program.

Clifton Below of Lebanon, who chairs the community power coalition and helped shepherd the rules through the PUC, said community power programs will aim to use more renewable energy, especially from publicly-owned installations, and a more active portfolio management to keep costs down — at or below the default rate.

"More value in terms of the supply of electricity, and how we manage the selection and development of new distributed energy resources," Below said. "All of which can help stabilize the cost of our electricity."

Community power aggregation has been part of New Hampshire law since 1996, Below said, but the law only allowed for opt-in programs. It was hard to get consumers' attention, he said, so community power programs never got off the ground here. A 2019 law allowed for an opt-out model — similar to a law that exists in Massachusetts, and allowed for the establishment of the Cape Light Compact on Cape Cod.

The draft rules promulgated by the Public Utilities Commission last week are a key step to establishing similar community power programs here, Below said — service he hopes will be competitive with the big utility companies, while being controlled by local people, including locally-accountable elected officials.

He hoped community power programs will help stabilize costs, and enable New Hampshire to use more renewable energy.

"This is going to use the tradition of local control, self-governance and frugality to do this in a market based way."