Liberty rate case OK'd; boost to energy efficiency may followBy MICHAEL COUSINEAU
New Hampshire Union Leader
April 30. 2018 8:28PM
CONCORD — The state Public Utilities Commission in a first-of-its-kind rate case approved Liberty Utilities earning revenues on a per-customer basis, rather than on how much natural gas it sells.
That could boost energy efficiency.
Meanwhile, about $2.4 million in expected savings from expected lower taxes will help cushion the rate increase of about $73 a year for customers in the Keene area and $85 yearly for customers elsewhere in New Hampshire based on new rates going into effect Tuesday.
The PUC’s decision means “the utility no longer has this inherent lust to sell more of its product,” said state Consumer Advocate Donald Kreis, who worked with Liberty to reach a settlement agreement on the issue.
Kreis said Liberty has the right not to accept the PUC’s decision after Liberty agreed to a rate settlement that the PUC didn’t go along with.
Liberty spokesman Emily Paquette said the order came out late Friday night.
“We are still reviewing it to determine its impacts and our next steps,” she said. “We believe decoupling is beneficial to customers, as it provides bill stability and helps increase the adoption of energy efficiency.”
The PUC said a “decouping mechanism” allows for rate adjustments for weather, energy efficiency, economic effects and other variables that allows Liberty to earn distribution revenues on a per-customer basis, “thus eliminating substantial revenue risks.”
The change has practical effects.
“The mechanism was designed to sever the link between Liberty sales and revenues to remove the company’s disincentive to promote energy conservation that is inherent in traditional ratemaking,” the commission wrote.
“It’s good because the company no longer has a disincentive to pursue energy efficiency,” he said. “There are regular adjustments to make sure that revenue stays relatively stable.”
The commission also reduced a monthly customer charge on bills by $2 a month.
Liberty has 90,000 natural gas customers in Berlin, southern and central New Hampshire and 1,200 propane customers in Keene.
Liberty proposed a $14.5 million hike in its distribution rates on a yearly basis, but the PUC approved $8.1 million, either rejecting or deferring decisions on certain things that Liberty wanted included in rates.
“We recognize that this order calls for major changes to the way Liberty interacts with its customers, and we applaud Liberty for bringing forward a number of innovative proposals,” the PUC said.