May 23, 2020
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Unpaid utility bills may lead to higher energy prices in coming months

Robert F. Bukaty | AP
Robert F. Bukaty | AP
Chairs sit on tabletops at 3 Dollar Deweys, a pub that remains closed due to the coronavirus pandemic, Thursday, May 21, 2020, in Portland, Maine. Under Gov. Janet Mills's tentative plan, bars will be allowed to reopen on July 1.

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PORTLAND, Maine — Energy demand is down because of the pandemic, but utility bills left unpaid by tens of thousands of people who lost jobs during the coronavirus pandemic could drive electricity prices upward in some areas in coming months.

Electricity demand is down by 3 percent to 5 percent in New England, and the power grid operator said there should be sufficient power for peak demand this summer.

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“We expect the pandemic to continue to affect the way consumers use energy throughout the summer, though the exact changes are impossible to predict,” said Vamsi Chadalavada, ISO New England’s chief operating officer.

Regardless, he said, there’s enough wiggle room built into the power grid to deal with fluctuations in demand.

The irony is that reduced demand for electricity could be coupled with higher rates several months down the road.

Across the country, utilities have been forbidden from cutting off customers for nonpayment at a time when nearly 39 million workers have sought unemployment assistance.

In Maine, several utilities, including Central Maine Power, already have alerted regulators that there could be a problem in coming months as uncollected payments affect the balance sheet.

“It could have an upward pressure on rates, but it’s too early to see if that will indeed be the case,” said Mitchell Tannenbaum, lawyer for the Maine Public Utilities Commission.

Similar problems could crop up elsewhere.

For instance, the Minnesota Public Utilities Commission heard testimony this month from utilities worried about the pandemic’s impact on the bottom line. Tracking those costs is key to recovering them through regulatory action.

For now, there’s plenty of electricity in New England, and the grid operator plans for demand fluctuations like those seen since March.

“New England’s power system is able to account for and respond to this uncertainty,” Chadalavada said in a statement.

More than 33,000 megawatts of capacity is expected to be available to meet New England consumer electrical demand.

This summer, under typical conditions, electricity demand is forecast to peak at 25,125 megawatts, and extreme events such as an extended heat wave could push demand up to 27,084 megawatts.

Watch: Drug to treat coronavirus coming to Maine

 


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