Rhode Island Energy proposes increases in customer electric and gas service charges
By Nancy Lavin, Rhode Island Current
Rhode Island Energy unveiled its long-anticipated request to increase service charges for gas and electric customers in a press release the day before the Thanksgiving holiday. An application spanning thousands of pages across 21 separate documents was simultaneously submitted to the Rhode Island Public Utilities Commission for review.
If approved, the increases would take effect in September 2026.
For the first year, the average residential electric customer would see their monthly bills rise $7.78, or 4.83%, while a typical residential gas customer would pay $343.53 more, a 20.6% increase, according to Rhode Island Energy’s proposal. Charges would rise again in the second year, with another $1.56 added to monthly electric bills, on average, and $89.43 more tacked on to annual gas bills.
Anticipating the fury coming its way, Rhode Island Energy President Greg Cornett had already attempted to justify the proposal by highlighting the benefits for customers.
“This review is about making smart, necessary investments in reliability, customer service, and safety, while also keeping affordability top of mind and strengthening support for those who need it most,” Cornett said in a statement Wednesday. “Throughout this process, we want our customers to understand that we are keenly aware of the challenges so many of them are facing, and that we are committed to keeping customers informed and helping them manage their energy costs now and into the future.”
As part of its request, Rhode Island Energy has also proposed reworking its discount program for low-income customers, offering larger reductions to those with the lowest household incomes. Rather than a 25% or 30% discount for households that qualify for federal assistance, the company is proposing three tiers — 10%, 30% and 60% — based on household income, according to its application. This would ensure low-income residents are not spending more than 3% of their income on electricity, or 6% of income on electricity and gas combined — the same goal touted by state lawmakers and advocates of the Percentage Income Payment Plan.
State regulators prevented the utility supplier from asking for a distribution rate increase for the last three years under the terms of the 2022 sale of gas and electric operations from National Grid to PPL Corp., Rhode Island Energy’s parent company.
The moratorium ends in May, and now, Rhode Island Energy is ready to take back what it claims it needs to offset inflation and supply chain expenses.
For example, the cost of installing a 1-mile section of underground electric cable has nearly doubled, from $12,000 in 2020 to $22,000 today, according to the company. Electric surge protectors now cost $120, compared with $60 in 2020. Upgrading natural gas pipelines now come in at nearly triple the price, the company said.
“This proceeding is not about increasing rates for the sake of it – it is about maintaining and improving the system so we can meet present and growing needs and avoid bigger, more expensive problems down the road,” Cornett wrote in the application. “Although it may appear enticing to delay the proposed investments because of today’s affordability concerns, doing so would only make things harder for everyone in the long run.”
“The proposed increase is necessary for [Rhode Island Energy] to continue to meet regulatory mandates, align with the real cost of doing business, and continue delivering around-the-clock service,” the press release stated.
The company expects to generate an additional $230 million in operating revenue over a two-year period from its proposal, according to a federal financial disclosure statement also filed Wednesday.
PPL’s profits and shareholder returns have come under scrutiny by state lawmakers and consumer advocates, who contrast company earnings with cash-strapped residents struggling to pay their winter energy bills. Electricity prices have only abated slightly since reaching record highs three years ago
Under state law, the company cannot recoup any money from its usage rates, which are instead set directly by prices from third-party suppliers.
Adding to public fury: accounting errors which revealed the company overbilled state agencies $2 million in their 2024 energy bills. State utility regulators are reviewing complaints from residential customers who allege they have been overcharged, including on the rollout of 540,000 smart electric meters statewide.
The Public Utilities Commission has final authority over any increases in electric and gas rates. The three-person panel considers the financial solvency of the company alongside ratepayer affordability and the true necessity of proposed capital projects. Historically, the commission has trimmed some money from the original company requests to blunt the impact on ratepayers.
The last time the commission reviewed a distribution rate increase, under National Grid’s ownership, was in 2017. The approved rates were 40% less than what National Grid asked for.
Earlier this week, Chairman Ronald Gerwatowski highlighted the commission’s ability to influence distribution of customer bill credits, which Rhode Island Energy must refund to customers under the terms of the 2022 sale. Rhode Island Energy withdrew its initial proposal earlier this month amid scrutiny over the calculations, but plans to file an alternative scheme early next year.
The discounts, which aim to shield ratepayers from company tax and accounting expenses related to the 2022 sale, could help mitigate higher service charges, Gerwatowski said Monday.
A series of internal meetings and public comment sessions will take place over the next nine months, dates for which had not been scheduled as of Wednesday. The commission can also opt to postpone the implementation of service charge hikes for up to eight months beyond the proposed effective date of September 2026.
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Rhode Island Current is part of States Newsroom, a nonprofit news network supported by grants and a coalition of donors as a 501c(3) public charity. Rhode Island Current maintains editorial independence. Contact Editor Janine L. Weisman for questions: info@rhodeislandcurrent.com.
