The Maine Energy Office announced Friday that electricity rates in Maine as compared to the national average are much higher than other states. The data, provided by the U.S. Energy Information Administration, indicates that Maine rates are improving. However, Maine is still 24 percent above the US average at 11.94 cents/kWh (per kilowatt hour) as compared to the national average of 9.62 cents/kWh.
Maine has the 12th highest electricity prices in the United States. Maine’s 2010 average all-sector retail price was 31 percent above the national average decreasing to 26 percent above in 2011. The latest data shows that we are currently at 24 percent above the national average. “We are moving in the right direction, but we need to progress more quickly. Electricity rates are so high that they are killing job opportunities in the State of Maine,” said Governor Paul LePage.
The decline in rates can be attributed in part to the standard offer rate for Residential and Small Commercial customers that decreased in March. The decline was approximately one cent per kilowatt hour (kWh) – electricity usage in Maine is billed in terms of cents per kWh of electricity consumed – saving consumers approximately $50 million per year.
While it is encouraging that Maine’s electricity rates are decreasing, the reduced prices are primarily the result of the significant decreases in the price of natural gas, which sets the clearing price in the market. Natural gas is the primary fuel for about 50% of the capacity in Maine. However, Maine has one of the highest renewable standards in the nation, requiring 40% of total retail electricity sales to come from renewable resources by 2017.
The Governor has been and will continue to prioritize his work with natural gas companies, regulators, potential customers, communities, neighboring states and provinces and other stakeholders to expand natural gas infrastructure throughout the State.
Additionally, to ensure an affordable, adequate and reliable supply of electricity for Maine residents and to encourage the use of renewable, efficient and regional resources, the Governor will continue to open the market to all cost-effective generation sources, including large-scale hydro-power. The LePage Administration will again seek to remove the 100MW cap on hydro-power in an effort to lower energy prices for Mainers.
The Governor and the Governor’s Energy Office are developing a short- and long-term strategy to pursue energy security with clean, reliable, affordable, sustainable, regional resources and increased access to natural gas supplies where economically feasible. The Plan will also provide a clear, concise and comprehensive blueprint to address a potential or actual energy emergency caused by a supply disruption, a rapid and unsustainable increase in energy prices or other energy emergency situation.
Kenneth Fletcher, the Director of Governor LePage’s Energy Office, says, “This Administration is committed to lowering the energy costs for Mainers and the way we reduce costs is to advance an energy agenda next legislative session. The Energy Office is going to continue to work tirelessly to lower Maine’s energy costs to benefit all Mainers and make the state more business-friendly to enhance economic development and job growth.”