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Spend your gas savings on rising electric bills

Consumers celebrating $2-a-gallon gas prices can spend their savings on $125-a-month electricity bills.

Starting this month, the electricity bills for most NStar customers will rise 29 percent compared to last January. The rate increase, which was approved by state regulators in November, could eat into the benefit consumers are reaping from the falling price of crude oil -- low prices on gasoline and heating oil.

For the first half of 2015, the cost of electricity for NStar households will be at its highest level since Massachusetts overhauled its electricity market in 1998. The supply portion of consumers’ bills will go from 9.379 cents per kilowatt-hour to 14.972 cents. The rest of the bill, which pays for the transformation and delivery of power, varies by town, but is mostly flat this year.


A typical NStar household in Boston, which uses about 500 kilowatt-hours of electricity, would see their monthly bill rise from $95.80 last winter to $123.10, according to company figures.

Michael Durand, an NStar spokesman, said the company reads people’s electricity meters at different times, so an individual household’s electricity expenses might not jump by the full amount from one month to the next. For example, a household whose meter is read on Jan. 15 would pay half of its bill at the old monthly rate and half at the new rate. The next month’s bill, from Jan. 16 to Feb. 15, would be under the new, higher rate.

Durand emphasized that the increase was a pass-through cost -- that is, the utility will charge customers more because power generators are demanding a higher price for electricity. A growing share of Massachusetts’s electricity comes from natural gas-burning power plants, which has increased demand for the state’s limited inflows of natural gas, leading to occasional winter-time price spikes.

Late last year, bills for National Grid customers also rose. That increase, pegged at 37 percent compared to the winter before and nearly 50 percent higher than during the summer, went into effect in November and will last through April.


Under Massachusetts law, utilities set their basic service rates for six months at a time. Most consumers opt for a flat montly rate that changes twice a year, while some choose a rate that varies every month. A growing number of consumers have signed contracts with competitive electricity suppliers, but switching can be risky or expose consumers to higher rates.

January power prices peaking in Boston
Average monthly bill for an NStar household using 500 kWh of electricity
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Jack Newsham/Globe Correspondent

Jack Newsham can be reached at jack.newsham@globe.com. Follow him on Twitter @TheNewsHam.