Perhaps the most significant factor affecting the rate decrease is a drop in the utility’s energy service charge, Murray said, which constitutes more than half of a customer’s bill, he said.
That charge will decline 10 percent — from 9.54 cents to 8.62 cents per kilowatt hour.
A key reason is a reduction in the cost to produce electricity, Murray said.
“Our plants are operating more efficiently and economically,” he said.
That saved customers more than $45 million in the first quarter of the year, according to PSNH.
Recent changes in state regulations also make it cheaper for PSNH to provide electricity, Murray said.
Another key factor is that PSNH has made its last payment on a series of “stranded cost” bonds it’s been paying for the last 12 years as part of a restructuring of the electric industry, he said.
That cost has dropped from $3.92 to 67 cents per 500 kilowatt hours, Murray said. PSNH also is saving money through the expiration of contracts with small independent power producers, he added.
PSNH’s lower costs also come at a time when the utility been asked to invest in regional power grid improvements, increasing its monthly transmission charge for customers. Homeowners will see their cost per kilowatt hour rise from 1.84 cents to 1.86 cents.
PSNH must also increase the amount of money its puts in a reserve fund established to fund the restoration of power during serious storms.
Several ice and snowstorms have left Southern New Hampshire residents without power for days and required out-of-state utility crews to help restore electricity.
“We have had a slew of them in the last couple of years,” Murray said. “We had been putting $7 million a year in and now we’re going to be paying $12 million a year.”
That cost per month, based on 500 kilowatt hours, rises from $11.96 to $12.44 a month for residential customers, he said.