Many N.H. ratepayers saw the price of electricity double from 10¢ per kilowatt hour to 22¢ this summer, while some in Mass. only saw prices rise from 13¢ to 15¢. What gives?
Gas prices are extremely volatile
The COVID pandemic in 2020 temporarily disrupted this trend; the global economy came to a halt and many oil and gas operations curtailed production. But as demand for fossil fuels began to rebound in 2021, supplies haven’t recovered as quickly. This has meant steadily rising prices. Add in some record-setting cold temperatures in many parts of the country this past winter, and prices have gone up even more.
“We just have a physical constraint of how much gas we can deliver through the pipeline system to New England,” said Ben Butterworth, director of climate, energy & equity analysis at the Acadia Center.To help make up the shortfall, New England imports liquified natural gas from other parts of the country to use for electricity — over the last decade, we’ve brought in between 20-43 billion cubic feet of LNG per year.
Today’s focus is on the “supply charge.” This is the cost of the actual electricity you used in the last month. It tends to be about half of your monthly bill and it’s what has been rising in odd and unequal ways across the region. As a bit of background, the six New England states are part of the same regional electricity grid, which means that an electron produced by a power plant in Connecticut could theoretically travel through the wires and end up helping to illuminate a light bulb in New Hampshire.
The second, and perhaps most important factor, is timing. If your utility held its auction before the war in Ukraine started and gas prices jumped, you’re probably seeing cheaper electricity than your cousin whose utility negotiated its prices this spring.
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