PRESQUE ISLE, Maine — Officials from Emera Maine held their annual open customer meeting at the Hampton Inn in Presque Isle on Wednesday, June 27, to discuss upcoming transmission rate changes for residential and commercial customers.
On June 19 regulators from the Maine Public Utilities Commission approved a 5.34 percent increase for the distribution portion of a customer’s bill, or $1.60 per month, as of July 1, lower than the 12 percent increase that Emera originally asked for to pay for investments in system reliability and resiliency, tree trimming and removal and customer service improvements.
The approved increase equals to $4.48 million in revenue across all customers, while Emera’s original request would have resulted in $10 million in revenue and a rate increase of $3.60 per month for customers.
Chad Wilcox, sales and revenue manager for Emera, explained to a crowd of around 20 business professionals that the major cause for the rate increase is the loss of a one-time transmission rate discount shared with all Maine Public District customers last year.
Although the increase, which is the third hike to occur within in five years, has proved controversial with many residents, Wilcox clarified that Emera determines yearly rates by considering the costs of investing in power grids through short-term and long-term projects and the cost for the company to provide electrical service.
Emera provides electrical service to 10,400 square miles and 159,000 customers in Maine, with Aroostook County accounting for about a quarter of their business. Residential customers make up 52 percent of revenue, while commercial businesses make up 40 percent and 9 percent comes from industry.
Bob Dorsey, president of Aroostook Partnership, had concerns about why Emera is able to continue raising customer rates.
“The bottom line is that you’re a monopoly, with a guaranteed profit, who has no intent to lower prices,” Dorsey said.
Wilcox clarified that Emera Maine is a monopoly but one that is regulated and only has one shareholder, the Halifax, Nova Scotia-based Emera, Inc. All distribution rate requests are reviewed by the Maine Public Utilities Commission.
“We are a monopoly, but we’re a regulated one,” Wilcox responded. “We don’t have competition, but our regulator exists so that a company like ours doesn’t kick up rates three times during a summer without notice.”
Electric bills for customers are divided into five rates: transmission and distribution rates –which is the rate being increased — the conservation rate that supports Efficiency Maine programs and stranded costs leftover from deregulation that represent the cost of state programs and long-term power. The final rate is for electric supply.
Steve Sloan, manager of transmission development for Emera Maine, detailed Emera’s efforts to repair hundreds of miles of lines in the Maine Public Services district over a 30-year period, which began in 2007. The company has yet to complete around 160 to 170 miles of lines, but decided to increase the total project time frame from 15 to 20 years to 30 in order to maintain project costs that do not greatly affect customer rates.
“The lines were built with wood during the 1950s and 60s and, as you can imagine, wood is very susceptible to weather-related damage. Over time they can cause unreliable service in some areas,” Sloan said.
“I understand why that model is in place and appreciate the efforts to keep the project at a reasonable pace, but if you replace wood with wood you’re going to have the same problems years from now,” Dorsey countered.
“Our demographics are shifting in Aroostook County. In 15 years we’re predicted to lose 9,000 people and have another 16,000 reach retirement age,” he continued. “We need a different model so that businesses don’t go off the grid to avoid electric costs or are discouraged from coming here at all.”
Dorsey then encouraged Emera officials to work with the Aroostook Energy Association, a nonprofit organization made up of local manufacturers and services providers, to come up with initiatives that are more economically feasible for Aroostook County businesses.
“We’re always aware of the unique situations facing this region, which is one reason why we were pleased to see Aroostook Energy Association form,” Sloan said. “Even a blip in service up here can have negative effects and reliability is something that we take very seriously.”
Bangor Daily News reporter Lori Valigra contributed to this report.
