The Vermont Public Utility Commission has adjusted base rates for Green Mountain Power Corp. to cover projected costs by effectively approving a nearly 2.7% increase for the fiscal year 2020 that will go into effect Oct. 1.
In an Aug. 29 decision (Docket No. 19-1932), Vermont regulators approved a 2.67% base rate hike for GMP, as recommended by the state Department of Public Service who recalculated the utility's rate need based on proposed reductions. Énergir LP subsidiary GMP had originally asked for a higher 2.92% increase. The utility still needs to modify the rates to meet proposed reductions recommended by the DPS.
The 2.67% rate hike will be on top of a 5.43% rate increase that officially went into effect at the start of 2019 but whose impact has been mitigated so far as a result of a windfall in federal tax cuts being passed along to ratepayers in the form of credits. With the tax credits expiring at the start of October, the full weight of the 5.43% rate increase will now be borne by customers. Line items related to the emerald ash borer infestation and major storm recovery costs are also going into effect.
In the order, the regulators acknowledged that the combined rate increases will be particularly burdensome for residential customers on fixed incomes and businesses that use large amounts of energy.
Most of GMP's costs are fixed under the three-year rate plan for October 2019 through September 2022 that was approved by the PUC in 2018. The 2.67% increase this autumn is the first of three rate adjustments that the utility will seek each year under the three-year period. "The primary purpose of this proceeding is to review GMP's three-year forecast of the costs, such as power supply costs, not fixed in the plan," the PUC explained in its latest decision.
The PUC asked GMP to file a revised rate within 14 days of its Aug. 29 rate approval, based on recommendations by the DPS for adjustments in the utility's power supply costs, property tax assumptions, and return on equity rates.