By Tony Dobrowolski, The Berkshire Eagle
BOSTON — Some Berkshire County residential ratepayers will see an annual reduction of up to $40 in their utility costs beginning next week.
To ensure that ratepayers receive the benefit of recent federal tax reform legislation, the Department of Public Utilities has ordered 14 of the state’s registered regulated electric, gas and water utilities to reduce their base rates by approximately $116 million, effective Sunday, the start of the new fiscal year.
Average annual bill reductions for residential customers will range from about $9 to $40, or a decrease of approximately 1 to 8.5 percent.
Only utilities whose corporate tax rate was reduced through the federal legislation are impacted. In Berkshire County, they include the Berkshire Gas Co., Eversource Energy and National Grid. The 11 other utilities include Agawam Springs Water Co., Aquarion Water Co. of Massachusetts, Bay State Gas Co., Liberty Utilities, Milford Water Co., Pinehills Water Co. and Unitil.
Under rate-making principles, utilities in Massachusetts subject to DPU regulation are allowed to reflect a representative level of tax expense in their rates. In order to capture savings for state ratepayers, the DPU opened an investigation in February to analyze how the recently enacted federal tax reform affects rates for utility customers.
The order also approved proposals from Berkshire Gas, Bay State Gas and Unitil to return to customers all tax savings accrued since Jan. 1, 2018. In the second phase of the DPU’s investigation, the agency will investigate the refund by all other affected utility companies of any tax savings accrued since Jan. 1, as well as the refund of excess accumulated deferred income taxes to customers.
“Reflecting our commitment to ensuring ratepayers are always receiving the most reliable service at the lowest possible cost, this order guarantees that the hundreds of millions of dollars in tax savings for utility companies are passed on to hard-working Massachusetts residents, who will see real reductions in their monthly utility bills,” DPU Chairman Angela M. O’Connor said in a prepared release.
Companies with pending rate cases have the option to defer any tax-related rate adjustments until the end of their cases, on the condition that they return all tax savings back to July 1, 2018, with interest at the prime rate.
Tony Dobrowolski can be reached at firstname.lastname@example.org and 413-496-6224.
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