Millstone nuclear power station Sean D. Elliot

Electric rates charged by Connecticut’s two utilities are headed for major reductions for the six months beginning July 1.

Eversource Energy (formerly Connecticut Light and Power) standard offer rates for residential customers will drop by more than one-third, to 8.228 cents per kilowatt-hour from 12.629 cents. United Illuminating rates will drop nearly one-third to 9.1241 cents from 13.3108 cents.

“This is very, very positive news,” said Eversource spokesman Mitch Gross. The last time rates were this low was July 2013 when Eversource rates were 7.573 cents per kilowatt-hour and UI’s were 7.70 cents.

The new rates, approved Friday by the Public Utilities Regulatory Authority, reflect a competitive bidding process run by the state for companies that generate electricity. This is conducted every six months, with new rates posted each January and July.

The new rates make both Eversource and UI more competitive among the many companies that now offer electricity in Connecticut.

There had been concern, reflected in the recent winter rates, that the shutdown of several major regional electricity generators — the Vermont Yankee nuclear plant, the coal- and oil-fired Salem Harbor Station in Massachusetts, and the Mt. Tom Station coal plant, also in Massachusetts — would generally keep the region’s electric rates high.

But even with the cold and snowy winter, this did not happen. The extreme drop in oil prices to about half of what they’ve been, the drop in liquefied natural gas prices, continued low natural gas prices and the fine-tuning of a winter reliability program instituted by the Independent System Operator that runs the new England grid, kept spot prices from spiking.

“While everyone welcomes this news,” said Department of Energy and Environmental Protection spokesman Dennis Schain in a statement, “we do need to continue working on regional challenges that tend to keep rates higher in Connecticut and New England — especially in cold weather months.”

These new rates are only for generation — the prices suppliers charge Eversource and UI. They are pass-throughs for those companies and constitute about half the monthly cost of an electric bill. They don’t reflect how the companies make their money.

Bill Dornbos, the Connecticut director and senior attorney for the regional environmental group Acadia Center, said he wasn’t completely surprised because July rates are typically lower than those covering the winter season.

“But this is even a bit more than I anticipated,” he said. “This is undeniably a positive for ratepayers on the standard offer.”

But he remained troubled by the fixed charge customers pay regardless of how much electricity they use. Those charges are now $19.25 for Eversource and $17.25 for UI, far higher than they have ever been, though not as high as the companies had requested. Dornbos said it means the fixed charges now become even larger percentages of a customer’s bill.

Acadia Center and other environmental organizations are supporting legislation this session to cap the fixed charge at $10.

Dornbos also worried that such huge price swings will keep customers from looking at energy efficiency and renewable energy sources as ways to lower their electric costs. “When have decreases like this, the urgency will lessen,” he said.

Jan Ellen is CT Mirror's regular freelance Environment and Energy Reporter. As a freelance reporter, her stories have also appeared in The New York Times, The Boston Globe, Yale Climate Connections, and elsewhere. She is a former editor at The Hartford Courant, where she handled national politics including coverage of the controversial 2000 and 2004 presidential elections. She was an editor at the Gazette in Colorado Springs and spent more than 20 years as a TV and radio producer at CBS News and CNN in New York and in the Boston broadcast market. In 2013 she was the recipient of a Knight Journalism Fellowship at MIT on energy and climate. She graduated from the University of Michigan and attended Boston University’s graduate film program.

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