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Pascoag Utility Seeks Freeze in Electric Rates

Posted on: Wednesday, 6 July 2005, 18:00 CDT

"It's great news because - with everybody else going up -- we're asking the state to [let our rates] stay the same," says PUD director Theodore G. Garille.

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BURRILLVILLE -- The Pascoag Utility District applied to the Public Utility Commission last week for permission to freeze its electric rates for the rest of the year.

The commission in January had approved a reduction in rates that amounted to a 24-cent reduction for a 500-kilowatt-hour monthly bill. On Friday, it began reconsidering that reduction.

PUD manager Theodore G. Garille said that the district had been required to check in with the commission by last Thursday, to make sure the district's estimates were accurate -- meaning, it isn't collecting too much or too little from its customers.

Garille said he expects the commission to approve the district's request to continue the rate-freeze.

"Our estimates are accurate, and will allow us to maintain our rates," he said. "It's great news because -- with everybody else going up -- we're asking the state to [let our rates] stay the same."

The New York Power Authority's St. Lawrence plant provides inexpensive, renewable hydroelectric power to seven states, including Rhode Island, which local utilities are required to resell at no profit, Garille said.

That plant and the New York authority's Niagara Falls plant together provide the PUD with about 25 percent to 30 percent of the power it needs, Garille said.

Recently, however, the PUD was in danger of losing that cheap power.

When the St. Lawrence plant was licensed, in 1953, Congress mandated that its power be considered a national resource, and be given to neighboring states.

When the 50-year license was set to expire, in 2003, many in New York advocated keeping all the plant's output in their state, Garille said.

After five years of negotiations, he said, the seven other states that had been purchasing electricity from the plant -- Rhode Island, Ohio, New Jersey, Pennsylvania, Connecticut, Vermont and Massachusetts -- were offered a 50-percent reduction in power that they could purchase from the plant, Garille said.

Massachusetts bowed out, leaving the plant to serve only seven states, including New York. Rhode Island, which worked out a deal with Pennsylvania, was the only state to retain its full power allotment.

Garille said the PUD would have had to spend about another $13 million, through 2017, if it had been cut off from the New York Power Authority.

He cautioned, however, that beginning next year, new contracts probably will increase the district's electric rates.

The Pascoag Utility District -- a not-for-profit electric company -- is the only public power utility in the state. It serves about 5,000 customers, in Pascoag and Harrisville.

Source: Providence Journal

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