At the beginning of November we communicated to all customers the need to make adjustments to the PPA portion of your electric bill beginning January 1st. Groton Utilities is very sensitive to any pricing adjustments but unfortunately the sustained nature of high energy costs will cause Groton Utilities to pass some of these additional costs through to our customers. Beginning January 1, 2023, customers will see an increase in the Purchased Power Adjustment (PPA) portion of their electric bill of $0.01602 kWh.
We are communicating this information once again to ensure that all customers are aware of this pending change in your electric bills so that you can plan accordingly.
All customers will need to prepare for higher-than-normal bills this winter. An average residential customer using 700 kWh of electricity per month could see an additional 9% on their bill, or approximately $11.21. With that said, we at Groton Utilities are extremely proud that we still have amongst the lowest rates in the state of Connecticut, as has been our priority.
Electricity costs have risen throughout the country due to several factors, including rising natural gas prices. New England is especially susceptible to natural gas pricing volatility due to inadequate infrastructure to supply natural gas to the region. The region relies heavily on natural gas to fuel over 50% of its electric energy requirements. Locally, our power supply costs increased 23% in fiscal year 2022 and are projected to increase by another 23% in 2023.
The Connecticut Municipal Electric Energy Cooperative (CMEEC), a state chartered non-profit joint action agency, and Groton Utilities, who buy power from CMEEC at wholesale, are keenly aware of the financial hardship utility customer’s face from the increased price of heating fuel and electricity. While no one has been shielded from the external factors driving the price increases, there are steps CMEEC and Groton Utilities have taken to minimize the impact to our ratepayers.
For its part, CMEEC procures power for Groton Utilities based on a carefully managed and layered purchasing approach whereby CMEEC procures power for the long, short and medium term. This approach can protect customers from large price swings that can occur when power is procured all at once or based on a rigid schedule.
Further stabilization of prices can occur with the use of the Groton Utilities rate stabilization funds. These funds are used by the Member Municipal Electric Utilities to mitigate the impact of short-term price spikes in the wholesale energy market. When wholesale energy prices decline, the rate stabilization funds are replenished and can be used to mitigate the next significant increase in electric rates, or for other utility purposes. As of now and for the upcoming winter, the recent retail rate increases of our Member Municipal Electric Utilities have ranged from 8% to 20%.
Groton Utilities stresses that now, more than ever, customers need to do all they can to conserve energy to reduce their monthly utility bill. We encourage customers to visit the Residential Energy Conservation section of our website and discover all the different ways you can conserve energy and save money, such as scheduling a free Home Energy Audit and/or starting a home insulation project to reduce heating & cooling costs. Additionally, Groton Utilities is currently running a promotion on rebates for the purchase of HVAC Mini-Splits, Hybrid Heat Pump Water Heaters and Smart Thermostats. Visit our Residential Energy Conservation Center and learn about all our current offerings.
Additionally Groton Utilities encourages customers to seek energy bill assistance through programs such as the Connecticut Energy Assistance Program (CEAP), TVCCA Energy Assistance, United Way Project Warm-Up and the Town of Groton Human Services Groton Utilities Energy Assistance Program.