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Historic Electric Rate Information

Typically, residential energy service rates are set twice a year through rate cases filed at the Public Utilities Commission. These filings are made by the individual electric utilities. Although not common, rates sometimes change more or less frequently. You can see this from Table 1 below, where rates changed three times in 2008 and 2012. Rates will go up and down year to year and will change depending on the time of year.

Let’s use the data in Table 1 as an example. Figure 1 shows how rates changed over the past 10 years along with a trend line. The trend has been for rates to increase. Over the most recent 10-year period, the increase has been about 2% each year. Please keep in mind that past history is not necessarily a predictor of future trends.

Year

Effective Beginning (Month)

Total per kWh Rate
(Residential Rate Class)

2005

August

0.13990

2006

February

0.15880

July

0.13313

2007

January

0.13457

July

0.13428

2008

January

0.13694

July

0.14574

October

0.14604

2009

January

0.15306

August

0.15161

2010

January

0.15134

July

0.15853

2011

January

0.15708

July

0.15494

2012

January

0.15063

April

0.15503

July

0.14879

2013

January

0.16094

July

0.15061

2014

January

0.15909

July

0.15858

2015

January

0.16932

July

0.15655

Table 1: Historic rates from Eversource from August 2005-July 2015

 

Historic Electrric Rates for Eversource

Figure 1: Graph displaying the historic electric rates for Eversource from February 1, 2005-July 1, 2015 with a trendline.

 

 

What to Consider If You Are Thinking About Solar

If you are thinking about a solar electric system (or PV system), one available financing option is a Power Purchase Agreement (PPA). The information below is about escalation clauses often found in a PPA.  For a complete overview of PPAs, check out “A Homeowner’s Guide to Solar Financing ”.

What is an escalation clause and how does it work?

Many solar PPAs include an escalation clause. An escalation clause increases the price per kWh you pay for the energy your solar system produces. Escalation is calculated each year at a compounding rate (%), adding the increase for the year to the prior year’s kWh price to calculate the price for the next year. Payments tend to escalate between 1% and 3% per year for many solar PPAs. Keep in mind that in New Hampshire the 10 year historic trend for electricity rates has been an increase of approximately 2% each year but that past history is not necessarily a predictor of future trends.

What can I use as a benchmark when evaluating the escalation percentage? 

The tables below help explain how escalation works. Table 2 shows what could have happened over the past 10 years at different escalation rates. The starting point is the known winter electricity rate from 2005. This value is then projected out with a 1%, 2%, 3%, and 4% escalation rate. You can see from the table that a 2% escalation rate ends up with an electricity rate close to today’s rate.

Escalation

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

1%

0.13

0.13

0.13

0.13

0.14

0.14

0.14

0.14

0.14

0.14

0.14

2%

0.13

0.13

0.14

0.14

0.14

0.14

0.15

0.15

0.15

0.16

0.16

3%

0.13

0.13

0.14

0.14

0.15

0.15

0.16

0.16

0.16

0.17

0.17

4%

0.13

0.14

0.14

0.15

0.15

0.16

0.16

0.17

0.18

0.19

0.19

Table 2: Historic rate escalation projections from February 1, 2005-2015 (Base rate=$0.1324)

Check out Table 3 to see what electricity rate paths might look like over the next 10 years. The starting point is the known Eversource total retail electricity rate from winter 2015. If rates continue to increase by 2% each year, then the total retail electricity rate in 2026 may be approximately $0.20 per kWh.

If you are thinking of using a solar PPA as a way to afford a solar energy system and are wondering how the escalation clause in the PPA is reasonable, it may be helpful to use a table like the one below to see what rates might look like over the term of the contract.

Remember, rates go up and down year to year and, within any given year, will change depending on the time of year. These projections are in no way a guarantee of future rates. They are merely a guide to show how escalation works and to help customers considering a PPA determine evaluate the proposed escalation rate.

Escalation

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

1%

0.16

0.17

0.17

0.17

0.17

0.17

0.18

0.18

0.18

0.18

0.18

2%

0.16

0.17

0.17

0.18

0.18

0.18

0.19

0.19

0.19

0.20

0.20

3%

0.16

0.17

0.17

0.18

0.19

0.19

0.20

0.20

0.21

0.22

0.22

4%

0.16

0.17

0.18

0.19

0.19

0.20

0.21

0.22

0.23

0.23

0.24

Table 3: Hypothetical rate escalation projections from January 1, 2016-2026 (Base rate=$0.16493)