State Announces Final Order on Eversource Gas Rates
BOSTON — The Department of Public Utilities (DPU) has issued a final Order in a rate case for NSTAR Gas Company, doing business as Eversource Energy, that will lead to investments in clean energy technologies, reductions in greenhouse gas emissions, and improvements in infrastructure safety and service reliability, while significantly reducing the total rate increase request of Eversource.
The action by the DPU follows a year-long investigation that included four public hearings across Eversource Energy's service territory, 12 days of virtual evidentiary hearings, and a review of approximately 1,800 exhibits. The Order applies only to customers who are provided gas service in NSTAR's territory in 51 towns in Eastern and Central Massachusetts and does not impact customers in the former Columbia Gas of Massachusetts gas service territory.
The DPU's Order reduced Eversource's base revenue request by approximately $12.2 million – decreasing Eversource's original requested increase of $34,970,916 by 35 percent. Today's decision marks the first time that Eversource's gas base distribution rates have changed since 2016.
"Today's Order will ensure Massachusetts continues to lead the way by investing and providing affordable, clean, and reliable energy solutions to ratepayers," DPU Chairman Matthew Nelson said. "Building on the Department's investigation into the future of natural gas in the Commonwealth's energy portfolio, the Order will also result in new clean energy options for residents to help Massachusetts achieve its aggressive emissions reduction goals."
Through the Order, the DPU also approved a demonstration project to study the effectiveness and scalability of a geothermal heating distribution network. The demonstration project will explore an alternative clean energy pathway for residents and businesses as the Commonwealth moves towards the Baker-Polito Administration's commitment to achieving net-zero by 2050.
Additionally, the DPU implemented a performance-based ratemaking mechanism that strives to balance funding the replacement of essential aging infrastructure with avoiding the expense of distribution rate cases for the next ten years. This mechanism also includes performance scorecard metrics to improve safety, reduce emissions, and enhance customer satisfaction.
Last week, the Department of Public Utilities (DPU) issued an Order opening an investigation into the role of local natural gas distribution companies in the future of the Commonwealth's energy portfolio following the Baker-Polito Administration's determination of net-zero greenhouse gas emissions as Massachusetts' legal emissions limit for 2050. As part of the investigation, the DPU will assess the role of gas companies in ensuring a low-carbon future and explore strategies that enable the Commonwealth to achieve net-zero greenhouse gas emissions while safeguarding ratepayer interests and securing safe, reliable, and affordable natural gas service.
The Order directs Eversource to commit to not filing another rate case until 2030. The rates approved in this Order will take effect on Nov. 1, 2020.