21 Aug 2014
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Natural Gas Market Prices and Supply Constraints Drive Increase in Electricity Costs for National Grid’s Rhode Island Customers

National Grid Urges Customers to Employ Energy Efficiency Measures and Participate in Bill Payment Options if Needed

Providence, RI. – National Grid’s Rhode Island electric customers will see an increase in their monthly bills starting January 1st.  On December 20, the Rhode Island Public Utilities Commission completed approval of rates requested by National Grid that will result in a total bill increase of 12.1 percent for the company’s residential customers receiving Standard Offer Service.  The overwhelming majority of the increase will go to cover an increase in the price of electricity that the company purchases for its customers and provides to them with no profit to the company.  National Grid is advising customers to learn more about energy efficiency and install measures to help reduce energy costs.  Customers also are encouraged to contact the company if they have difficulty paying their monthly gas or electric bill.

“Unfortunately this increase is driven by market forces we cannot control,” said Timothy F. Horan, president of National Grid in Rhode Island. “We understand that for some of our customers any rate increase may be difficult to manage and National Grid wants to work proactively to help Rhode Islanders control their energy costs as much as possible.”   

For National Grid Standard Offer Service customers, 11.9 percent of the increase will be seen in the Supplier Services section of their electric bill, and is attributable to increasing wholesale power prices in New England because of the region’s dependency on natural gas.  Approximately 50 percent of New England’s electricity generation is fueled by natural gas.  Natural gas prices drive electricity prices and forward -looking natural gas prices are forecasted to be higher for the foreseeable future.  Additionally, the regional energy market is anticipating a gas-constrained winter, which is being reflected in higher electricity prices this season.

National Grid Rhode Island natural gas customers saw a 1% decrease in gas rates effective on November 1st.  The commodity rates for natural gas are a product of National Grid’s long range natural gas purchase policies in RI, which help to mitigate price fluctuations.         

National Grid does not generate electricity and plays no role in determining market prices. The company purchases power supply on behalf of customers and passes those costs directly to customers, without profit.  Each year the company adjusts commodity prices on January 1 and July 1 for its residential and small business customers and quarterly for large business customers based on the results of requests for proposals for electricity required to meet customer demand during that period.

Between January 2014 and June 2014, the Standard Offer residential rate will be 8.55 cents per kilowatt-hour, compared with 6.35 cents per kWh during the final six months of 2013.  Other adjustments taking effect on January 1 are the Energy Efficiency Charge and the factor covering the costs of securing long-term renewable energy. When combined, the typical Rhode Island residential electric Standard Offer customer using 500 kilowatt hours of electricity each month will see their bill rise from $78.91 to $88.47; an increase of $9.56 or 12.1 percent.

National Grid’s gas and electric bills are divided between charges for delivery and commodity, also known as supplier services. National Grid’s rates are state regulated. The electricity commodity rate change has been approved by the Rhode Island Public Utilities Commission.

To learn more about energy efficiency measures, bill paying options and the components of the electric and natural gas bills, please visit www.nationalgridus.com.


National Grid (LSE: NG; NYSE:NGG) is an electricity and gas company that connects consumers to energy sources through its networks. The company is at the heart of one of the greatest challenges facing our society - to create new, sustainable energy solutions for the future and developing an energy system that underpins economic prosperity in the 21st century. National Grid holds a vital position at the center of the energy system and it ‘joins everything up’.

In the northeast US, we connect more than seven million gas and electric customers to vital energy sources, essential for our modern lifestyles. In Great Britain, we run the gas and electricity systems that our society is built on, delivering gas and electricity across the country. 

National Grid delivers electricity to approximately 3.3 million customers in Massachusetts, New York and Rhode Island. It manages the electricity network on Long Island under an agreement with the Long Island Power Authority (LIPA), and owns over 4,000 megawatts of contracted electricity generation, providing power to over one million LIPA customers. It is the largest distributor of natural gas in northeastern U.S., serving approximately 3.4 million customers in New York, Massachusetts and Rhode Island.

For more information please visit our website: www.nationalgridus.com

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