PROVIDENCE,
R.I. --Gov. Don Carcieri on Friday asked the Public Utilities
Commission to reject a 24 percent rate increase requested by
Narragansett Electric, saying the commission should wait until the end
of hurricane season before deciding on a rate hike.
"I
am concerned that the proposed increase is being unduly affected by the
uncertainty of the Gulf region," Carcieri said. "With another hurricane
bearing down on the Gulf, now is not the time."
The company has asked to increase its electric rate from 6.7 cents per kilowatt hour to 9.7 cents.
That would raise the average household's bill by $15 per month, Carcieri said.
He told the commission he didn't blame Narragansett Electric, a power distributor, for escalating utility costs.
"We
are here today not because of the actions of Narragansett Electric, but
because oil and gas companies and the power generators that supply
Narragansett Electric are totally unregulated," Carcieri said. "They
are making huge profits at the expense of Rhode Islanders, and all
Americans."
Frederick
Mason, Narragansett Electric's vice president for business services,
said his company has passed along savings as its distribution became
more efficient, but there is little it can do about the cost of energy
production. The company transports but does not produce electricity.
"What we're dealing with today is the cost of oil and gas that is used to generate electricity," Mason said.
He
said in an interview that if the rate increase is delayed, as Carcieri
requested, it would be more costly for consumers because Narragansett
Electric will have to borrow to pay its suppliers and then pass on the
finance charges.
"The credit card method, we think, is not the way to go," Mason said.
Matt
Auten, an advocate for the Rhode Island Public Interest Research Group,
said better statewide promotion of conservation, efficiency and the
development of renewable energy sources is needed more than regulation.
"The
less energy we need to produce overall, the less energy each consumer
is using, that's the way to bring down prices," Auten said.
He
praised the 2004 Clean Energy Act, which will require Rhode Island to
eventually get 16 percent of its energy from renewable sources, such as
wind, and this year's Energy and Consumer Savings Act, which increased
efficiency standards for 14 common appliances.
Carcieri
also said the commission also needs to look at its overall energy
policy, and said he wasn't sure deregulation has benefited consumers.
Since Rhode Island deregulated electricity generation, less than 1
percent of households have switched to suppliers other than Dominion
Power, which provides Narragansett Electric's standard offer service.
But
George Borts, an economics professor at Brown University, said that
though deregulation didn't create competition as intended, consumers
haven't been hurt.
"What
happened in Rhode Island was that the standard offer was too good to
pass up, so other suppliers didn't find it worthwhile to make another
offer," Borts said.
