With Benefit From New Tax Law, Eversource Says It Will Lower Rates For Mass. Customers
Some Eversource customers who braced for higher charges could end up paying less for their electricity after the energy company proposed changes based on the new federal tax law.
Eversource anticipates paying millions of dollars less in taxes under the tax law President Trump signed in December, which reduces the corporate income tax rate from 35 percent to 21 percent.
"We believe it's important that our customers reap the benefit of a lower tax rate,” Eversource Massachusetts Electric Operations President Craig Hallstrom said in a statement. "As a regulated power company our rates are based on our costs, including federal taxes, so if taxes are reduced ultimately costs are reduced and that benefits our customers."
The Department of Public Utilities in November approved a rate increase of $12.2 million for Eversource customers in eastern Massachusetts and approximately $24.8 million for western Massachusetts.
Eversource is now proposing to lower its existing rates for eastern Massachusetts by $35.4 million, along with a smaller hike of $16.5 million for its customers in the western part of the state.
Attorney General Maura Healey, who acts as the state's ratepayer advocate, argued against the initial rate hike and last month urged the DPU to recalculate the rates it approved for Eversource to reflect the new tax law.
This week, Healey called on other utilities to take similar steps to pass on savings to Massachusetts residents.
"This tax bill is being paid for by the people of Massachusetts, so the money should go back in their pockets," Healey said in a statement. "Our office filed this action to ensure that these savings go to customers. We are glad that Eversource has done the right thing by agreeing to lower its rates and we call on all our state regulated utilities to do the same."
Eversource, which has 1.4 million electricity customers in 140 Massachusetts communities, filed for a rate increase in January 2017, saying their proposed rates incorporated costs associated with capital investments geared towards improving service reliability and were based on "actual operation and maintenance cost deficiencies for a test year ending June 30, 2016."
This report was originally published by State House News Service.