- 3.95 Percent Rate Increase Proposed; Average Residential Bill Will Increase $3.10 Per Month;
- BED Residential Rates Projected to Continue to be Lower than Vermont Average;
- Enhanced Energy Assistance Program Will Mitigate Rate Increase for Low-Income Customers;
- Rate Increase Well Below Current Inflation Levels;
- BED financials bolstered by Net Zero Energy Revenue Bond and Strong Performance by McNeil Generating Station and Renewable Plants
Burlington, VT – Burlington Electric Department (BED), a not-for-profit public power utility serving the City of Burlington, today announced to the community that it is proposing a 3.95 percent electricity rate increase during fiscal year 2023 (FY23) that will appear first as a surcharge on customer bills in August 2022. The rate change will be reviewed by the Public Utility Commission (PUC). The increase is well below current inflation rates, and BED’s total rates will remain low compared to the Vermont average. BED’s financials have been bolstered by passage last fall of the $20 million Net Zero Energy Revenue Bond that has become a key source of capital funding, by strong production from BED’s McNeil Generating Station during the high energy price winter of 2021-22, and by the fact that BED’s resources are all renewable.
For residential customers, even with the proposed change, BED’s residential rates will remain lower than the Vermont average. While the average residential bill will increase by $3.10 per month, an enhanced BED Energy Assistance Program will provide a 12.5 percent discount on bills for eligible low-income customers. For the bulk of BED’s commercial customers (those on the small general service rate), the average bill increase will be $3.50 per month.
“Last year, Burlington Electric Department had our first rate increase in 12 years, at 7.5 percent, coming out of the pandemic,” said Darren Springer, General Manager of BED. “At that time, we committed to our customers that, while we likely would need more frequent rate changes going forward, we would seek more moderate ones. This year, at a time of both great volatility in energy markets and high inflation generally, we are proposing a 3.95 percent rate change. We were able to reduce upward rate pressure this year because our Net Zero Energy Revenue Bond provided an important financing source for key infrastructure projects, and through strong recent performance from our renewable generation plants, including BED’s largest energy source, the McNeil Generating Station. The proposed rate change will help Burlington Electric continue to provide the reliable, renewable power on which our community depends and to invest in our infrastructure and workforce. At the same time, we want to ensure that we provide support for our low-income customers who need assistance. That is why last year we launched our first-ever temporary Energy Assistance Program. This year, starting in July, we are seeking to boost our Energy Assistance Program to provide a 12.5 percent discount. This will more than offset the rate changes from last year and this year combined for participating low-income customers.”
“For decades, BED and our Commission have endeavored to reflect the goals of our community in providing safe, reliable, affordable, and environmentally sound energy,” stated Gabrielle Stebbins, Chair of the Burlington Electric Commission. “As a public power municipal utility, we operate as a not-for-profit organization, always striving to keep rates as low as we can. The Commission takes seriously the need for a rate change, seeking to ensure a balance between affordability and wise, long-term re-investment into our shared utility. I am grateful to the BED team for their work to keep the proposed rate increase to 3.95 percent – well below the inflation rate. While this is reasonable for some, it is a challenge for others. To meet this need, the Commission fully supports BED’s continuation and enhancement of an Energy Assistance Program to ensure that all our neighbors can keep the power on.”
Including the proposed rate change, BED’s total rates remain well below what they would have been had they just kept pace with the rate of inflation between 2010 and 2022.
Additionally, for FY23, BED is proposing to continue to help low-income customers through an enhanced Energy Assistance Program that mitigates the combined effects of both last year’s 7.5 percent rate change and this year’s proposed 3.95 percent rate change. Last year, BED implemented a program that provided low-income customers with a 7.5 percent discount on their electric bills. This year’s program, for which BED is seeking PUC approval, will provide low-income customers with a 12.5 percent discount on their electric bill. The cumulative impact on low-income customers of both rate increases will be an average of $8.95 per month and, if approved by the PUC, the bill credit of the expanded Energy Assistance Program will be an average of $10.65. Eligibility requirements include being enrolled in the State of Vermont Fuel Assistance Program or the federal Housing Choice Voucher (Section 8) Program, which support customers with eligible incomes. The Energy Assistance Program is projected to help between 800 and 1,500 qualified residential BED customers a month. Customers can learn more about the Energy Assistance Program by visiting burlingtonelectric.com/assistance.
Opportunities for Public Comment
The Burlington community will have opportunities to comment on the proposed rate case, including during the following meetings:
- Today/Wednesday, May 18 – the Burlington Electric Commission will vote on BED’s 3.95 percent rate increase proposal at its meeting scheduled for 5:30pm;
- Thursday, May 19 – Burlington Board of Finance BED Budget Presentation; and
- Monday, June 6 – Burlington Board of Finance and City Council.
Further, after BED files its rate case with the PUC on or about June 16, members of the Burlington community will have the opportunity to provide comment at public hearings and through written testimony during the PUC’s thorough rate review process, which is expected to span several months. The rates charged to customers of Vermont public utilities must be reviewed and will be approved only if the PUC determines that the proposed rates are just and reasonable. Prior to a final decision from the PUC and in accordance with PUC rules, BED will add a 3.95 percent rate surcharge on customer bills beginning in August 2022. This surcharge will continue until the rate case is finalized, at which time BED will adjust customer bills based on the outcome of the rate case. The public can learn more about PUC rate case procedures from this document.