The typical Rhode Island household will pay $3.38 more for electricity next month, after National Grid raises rates to pay for upgrades to its distribution system.

Starting March 1, the state’s largest electric utility will increase rates for residential customers by 4.2 percent and for small commercial users — small businesses — by 4.0 percent, according to documents filed late Thursday with the state Public Utilities Commission.

A household that uses 500 kilowatt hours of electricity per month — the so-called typical residential user — will see its bill increase from $79.71 to $83.09.
The filing was made to comply with a series of votes taken by the commission last week that dramatically reduced National Grid’s original proposal for a rate hike. It caps the commission’s eight-and-a-half month review of National Grid’s June 1 request to generate an additional $75.3 million with an increase that would have seen residential consumers pay as much as 11.2 percent more for electricity.

The proposed rate hike was driven not by an increase in the cost of energy, but by a would-be 33 percent raise in the distribution rate National Grid charges its customers. The utility justified the move by saying it had last raised the distribution rate in 1998 and needed the money to replace power lines and recoup an investment of nearly $300 million for upgrades since 2000.

But the George Wiley Center, the Pawtucket-based antipoverty group, protested the proposal saying Rhode Islanders could not afford such a steep increase in their electricity bills at a time when the state’s jobless rate is hovering around 13 percent. Toray Plastics America, which operates a factory in North Kingstown, said the rate hike would hurt private companies and prolong the state’s economic malaise.
And the Division of Public Utilities and Carriers, the state agency that has been acting as the ratepayers’ advocate in the case, recommended a series of cuts to National Grid’s proposal.

During a six-hour hearing Feb. 9, the three-member commission went even further than the division had, slashing nearly every item included in National Grid’s request.

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