Fung, residents rebuke electricity rate hike

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Rhode Island residents from all over the state converged Tuesday on the Public Utilities Commission (PUC) office in Warwick to participate in the public comment portion of a hearing to decide whether or not to accept the 53 percent rate increases on supplied electricity for the upcoming winter months, as was proposed by National Grid in July.

Those in protest of the hike donned signs ranging from “No Rate Hike” and “Play Fair, Pay Fair” to more on-the-nose slogans like “National Greed.” Cranston Mayor Allan Fung was the first in line to provide a public comment against the rate increase.

Despite the pleas to deny the rate increase, the commission unanimously voted to approve it.

“I certainly understand that 53 percent is not the number that the average homeowner or business is going to see, but I also understand that those numbers are still significantly high with what the average person and average business owners will be expecting in the forthcoming years if this rate increase is approved,” Fung said. “But ultimately, whatever that number, it is a significant increase that shocks the consciousness of every Rhode Islander and, in my opinion, is outrageous.”

The PUC reported at the beginning of the hearing that the estimated impact on the average Rhode Island resident following the supplied electrical rate increase would be $17.13, or 19.2 percent higher than their current bills.

Pauline Belal, a Cranston resident who lives on Gordon Street, gave an emotional testimony outlining her argument that even just an additional $20 was too much to bear for her and many residents like her.

“It is the difference between milk, eggs and gas for my car to shuffle my children between work, school and my absolutely necessary doctor’s appointments,” Belal, a mother of three, said. “It is the difference between me being able to afford the insurance on my vehicle, which is also ever-increasing in this state. If you guys continue to do this, you are going to put me on the street.”

After more than four hours of testimony, the commission approved the rate increase by a unanimous 3-0 vote, “determining that National Grid followed its approved procurement plan and calculated the rates correctly.”

Fung, however, felt that the necessity to hike rates by such drastic margins – even though he recognized that such an increase is a product of the complex free market machinations that dictate the price of electricity, and that National Grid does not profit off supplying electricity to consumers – showed that there is something wrong with the model utilized by National Grid.

“It is widely understood that National Grid is prohibited from profiting on the energy portion of the bill, but this idea that they are not making money off it misses the point, in my opinion,” said Fung. “I would argue that National Grid is not doing a good job of making the purchases going forward in an economical way to provide more stability to rate payers.”

Fung criticized National Grid’s argument that the market dictates what price they must pay for electricity and that energy delivery difficulties during colder months also contribute to higher costs.

“In my view, these price swings could have been smoothed out with better planning and anticipation of the seasonal ebb and flow of energy demand,” he said. “By blaming a lack of regional energy delivery capacity in the winter months, National Grid is sidestepping the issue and picking an easy reason for the increase.”

Others criticized the PUC for not taking the initiative to better diversify how the state gets its energy.

“Going forward, [we] would like to see more efficiency, more demand response, more renewable energy sources and dynamic prices,” said Kat Burnham, energy program manager for People’s Power and Light. “These options are also local, keeping dollars from leaving our state’s economy and providing more jobs in a growing industry. That’s good for residents, good for businesses and good for the environment.”

Fung said that he worried the increased rates could overburden people who were just barely able to afford their homes and the rising costs of insurance, groceries, as well as elderly individuals on a fixed income. He also expressed concern that monies available for discounted rates for certain eligible residents could be lessened in the future.

“In Cranston, there are 3,200 households that rely on our Low Income Energy Assistance Program...most of these families already have large back balances with National Grid for past usage,” said Fung. “Thousands of families in Cranston simply cannot afford the rate increase.”

Governor Gina Raimondo issued a statement shortly after the decision was reached, expressing concerns similar to Fung.

“This rate increase will create uncertainty for many Rhode Island families and seniors who live on fixed incomes,” the statement reads. “In the months ahead, I will direct our regulators to complete a comprehensive review of the utility companies' rates and ensure that Rhode Island consumers are paying a fair rate and not a penny more.

For people like Belal, the rate increase being confirmed means they will have no choice but to try and make adjustments to other areas of their budget as best as they can, because the increases are now coming. Whether that is fair or not remains up for debate.

“I am your average citizen,” Belal said, with her young son seated nearby. “I am not asking you for free, I am asking you for fair. I’m not asking somebody to support me. I don’t want to go on your welfare system. I don’t want your food stamps. I want to be able to sustain my home on my own.”

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