Dive Brief:
- Maine lawmakers are considering a bill to cap retail power rates at the standard offer price, after a study last year revealed many customers were not getting a good deal on their energy costs.
- The Bangor Daily News reported Maine residents buying power from competitive suppliers spent $50 million more in the last four years than they would have taking standard offer service. In 2015 alone, customers buying their energy on the market paid $32 million more.
- Rep. Norman Higgins (R) introduced HP 192, to limit the rates charged by competitive suppliers. The bill has been referred to the House Committee on Energy, Utilities and Technology.
Dive Insight:
A study last year revealed Mainers taking competitive energy supply were overpaying, spurring Higgins' legislative fix. But customers may be catching on—according to the Bangor Daily News, there were about 130,000 competitive customers in the state last year, down from a peak of more than 220,000 in 2013.
While customers comparing prices may see they're not receiving a good deal, lawmakers want to ensure all ratepayers are protected from aggressive marketing tactics.
According to the proposed bill "as a condition of licensing, a competitive electricity provider may not charge a residential consumer a rate for generation service that is higher than the standard-offer service rate available to residential customers in the service territory of the transmission and distribution utility that serves that consumer."
A look at competitive power rates shows they are higher than regulated rates, sometimes by a large margin.
For example, Central Maine Power, one of the state's main utilities, charges about $0.067/kWh. Conversely, competitive options in its service territory range from slightly lower to more than twice as high. Conversely, North American Power, a retail energy supplier for 12 states including Maine, has rates around $0.15/kWh and higher.