SolBid: Clean Energy News

Rising Electricity Rates Highlight the Power of Solar

Posted by Rebecca Noyes

Energy is an expensive commodity. Electricity rates have risen steadily over the last two decades in both the residential and commercial sectors. And a comparison of electricity rates from June 2017 to the same period last year shows a price increase in every region of the United States for all sectors.

Energy-Costs.jpg(image courtesy of Google)


Public and investor owned utilities raise rates through a formal request via a “rate case” with their Public Utility Commission (PUC). In a formal regulatory process, PUCs can either approve or reject these rate hike requests. The most common reason for which utilities seek rate hikes is for updates to infrastructure, for example to build new transmission lines, or to repair or update damaged or aging equipment. Utilities also often argue that rate increases are necessary to stay on pace with rising natural gas prices.

The most recent rate hike comes out of Rhode Island, where last week regulators approved National Grid’s petition to increase monthly electric bills by more than 10 percent. The state Public Utilities Commission voted to approve the rate increase from 6.3 cents a kilowatt hour to 9.5 cents. National Grid has blamed the increase on “high prices in the regional energy market.”

Lieutenant Governor of Rhode Island Dan McKee took issue with the new utility rates, claiming that it could impact the growth of small businesses. “National Grid’s proposed 53-percent standard offer rate increase is unacceptable. Another rate hike is a step in the wrong direction when it comes to making Rhode Island a better place to live, work and own a business” McKee said in a statement.

State Sen. Elaine Morgan, also took a stand against the proposed changes, calling the rate hike “unconscionable.” Morgan argued “It is already difficult to run a business in Rhode Island. If you speak with any business owner, they will tell you that escalating utility costs are a top concern.”

But Rhode Island is not the only state that will be facing rate hikes this year. In North Carolina, Duke Energy is asking state regulators for a rate increase totaling $647 million, representing a 13.6 percent average rate increase for all groups of customers. According to the company, almost half of the increase will be used to cleanup and dispose of coal ash sites, a byproduct of coal-fired power generation.

Prominent environmentalists were quick to criticize Duke’s move to force ratepayers to pay for coal ash costs as unfair. “Duke shouldn’t be allowed to shift the billions it will cost to clean up its coal ash mess away from the company and its shareholders and onto the general public,” Dave Rogers, a North Carolina representative for Sierra Club, said in a statement.

Rate hikes have also been requested this year by Tucson Electric Power in Arizona; Pacific Gas & Electric in California; DTE Energy in Michigan; and Florida Power and Light. And this list is hardly exhaustive. But while electricity rates continue to rise, solar costs have continued to fall drastically over the last two decades.

Solar is the ideal path for residential and commercial customers to shield themselves from ever-rising costs. By installing solar, businesses can expect that electricity costs will always be more predictable than utilizing electricity from the grid, and in the long term, costs will almost certainly be lower with solar. As natural gas prices continue to rise, and extreme temperatures drive up the demand for electricity, there isn’t a better time to install solar than right now.


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