New tax law could lower proposed National Grid rate hikes in RI

PROVIDENCE, R.I. (WPRI) – Will the new federal tax law take some of the sting out of National Grid’s proposed rate hikes for Rhode Islanders?

It’s too soon to say for sure, but on Dec. 21 the R.I. Public Utilities Commission asked the company to recalculate how much of an increase it needs in light of the law, which slashed the federal corporate tax rate from 35% to 21%. National Grid has been seeking an estimated 6% increase in electric bills and a 5% increase in gas bills.

Thomas Kogut, a spokesman for the PUC, said National Grid’s response is due Thursday, and its findings will impact whatever new rates are set. As currently proposed, the added cost of the increases would be $41 million more a year for electricity customers and $30 million more for gas customers.

The tax law has already had an effect on utility rates across the border in Massachusetts, where Eversource announced last week it would reduce rates statewide to pass along some of its millions of dollars in tax savings to customers.

Ted Kresse, a spokesman for National Grid, declined to speculate on how the new tax math would change its rate requests, which are supposed to take effect Sept. 1. “At this point, we’re still reviewing the new tax law and the expected benefits to our customers,” he said in an email.

Lt. Gov. Dan McKee, a Democrat and frequent critic of National Grid, sent a letter to the PUC last Friday asking the commission to take the tax law into account as it reviews the rate request.

“Our neighbors in Massachusetts will be getting a break on their monthly electricity bills,” McKee said in a statement. “It’s time for Rhode Island to ask National Grid to use its corporate savings to lower rates in our state and provide much needed relief for local families and small businesses.”

Ted Nesi (tnesi@wpri.com) covers politics and the economy for WPRI.com. He writes Nesi’s Notes on Saturdays and hosts Executive Suite. Follow him on Twitter and Facebook