The Central Maine Power utility announced on Wednesday that residential customers can expect another 4% reduction in their average electric bills next year. This adjustment is attributed to a decrease in the transmission rate for electricity delivery, marking the second rate reduction announcement in as many weeks. The drop in CMP’s delivery price, scheduled for January 1, will bring the rate down from 12.2 cents to 11.7 cents per kilowatt hour.
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In Maine, electric bills consist of two components: supply and delivery. Supply costs cover electricity generation, while delivery costs are allocated to local utilities.
Central Maine Power
Jon Breed, a spokesperson for CMP, explained that the delivery rate is determined by a complex formula developed by ISO-New England, the regional grid operator, and the Federal Energy Regulatory Commission (FERC). This rate reflects the expenses associated with local and regional transmission services.
Breed noted that the FERC rate, updated annually, is a standard applied across New England utilities. Fortunately for CMP customers, this year’s update resulted in a reduction. Two weeks prior, the Maine Public Utilities Commission had approved a 35% decrease in the 2024 standard offer rate for supply, benefiting residential and small-business customers who don’t contract with competitive energy providers.
These combined rate reductions are expected to save the average CMP standard offer customer approximately $35 per month. Despite a previously approved rate increase in June, which would raise a typical home’s electric bill by just over 1%, or $1.67, starting in July, the recent supply and delivery rate reductions create a “net negative” scenario for customers heading into 2024, according to Breed. The earlier rate increase was part of a compromise with Maine’s public advocate, addressing grid upgrades, reliability, storm damage resilience, and clean energy investments.
