CMP Electricity Rates Are Rising. Here’s What’s Driving Them.

Starting this month, Central Maine Power Co. customers will pay an average of $15.56 more per month — or 12.6% more — for storm recovery, renewable energy and incentives for electric heat pumps and electric vehicles.

The increase isn’t as high as it could be because some costs have fallen, including transmission costs. The total cost increase is calculated as the amount paid by ratepayers who use an average of 550 kilowatt-hours per month. These changes result in an average CMP customer bill of $138.76.

The higher rates were approved in separate cases by the Maine Public Utilities Commission in recent weeks, but to a large extent the higher fees reflect public policy set by the Legislature.

PUC Chairman Philip L. Bartlett said at a recent agency meeting that the state’s tax policy is a better tool than electricity rates for raising revenue to fund public policy goals, such as renewable energy payments, that are intended to help meet Maine’s climate goals.

“With any rate change, some customers will benefit while others will be negatively impacted,” he said. “Trying to capture public policy costs in electricity rates is inherently difficult and at odds with traditional cost-of-service pricing principles.”

Ideally, tax policy and the use of general government revenues would ensure “fair consideration,” Bartlett said.

“Recovering these costs through rates will almost always be less equitable,” he said.

CMP serves most of Maine, with 653,170 customers in the western, central and southern parts of the state.

Those customers will be charged an additional $5 to pay an additional $179.3 million for various policies, including transition costs for net energy settlements, which credit solar developers and other generators for the renewable energy they produce and send to the electric grid. It also includes purchase agreements, required by lawmakers, for power generated by wind and solar farms, as well as maintenance for unused CMP assets, such as the shuttered Maine Yankee nuclear power plant in Wiscasset.

The largest portion of the rate increase — more than $10 for the average customer — was intended to reimburse CMP for $220 million in cleanup work following devastating storms in 2022 and 2023.

And about $1.50 is earmarked for expanded electricity-saving programs, particularly expanded subsidies for heat pumps, promoted by the Efficiency Maine Trust, a quasi-state agency. Its budget of $60.3 million is up from $50.7 million last year, said Executive Director Michael Stoddard. The unspent money has helped reduce the amount utilities are asking for, he said.

Some customers of the state’s second-largest utility, Versant Power, will pay less starting this month. Versant serves 165,000 businesses and residents in northern Maine.

A residential customer in the Bangor Hydro District — Hancock, Piscataquis and Washington counties and most of Penobscot County — using 550 kWh per month would pay $1.83 less on a bill of $149.91 for delivery and the standard delivery offer, or default cost of electricity.

However, a residential customer using 550 kWh in the Maine Public District, which covers Aroostook County and a small part of Penobscot County, will pay $6.99 more on a bill of $137.35.

Unlike CMP, which recently received state approval for higher rates to cover storm recovery costs, Versant is seeking permission from the PUC to raise rates next year. Versant is seeking $171.8 million in revenue to fill a $34.1 million gap for storm cleanup and projects that include replacing transformers and installing covered wires.

For customers, rates will increase by $12 per month, or nearly 25%, if regulators approve the proposal.