PROVIDENCE – National Grid Rhode Island signed a settlement to reimburse ratepayers $7.9 million related to rate overcollection following federal corporate tax rate cuts in 2017, Lt. Gov. Dan McKee announced Wednesday.
The funds will result in a 12-month reduction to utility rates in Rhode Island, starting in July 2019 for electricity customers and November 2019 for natural gas customers.
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The settlement, overseen by the state Public Utilities Commission, was between National Grid and the Lt. Governor’s Office, The R.I. Office of Energy Resources, and The Division of Public Utilities and Carriers.
The settlement was approved May 17.
“As Lt. Governor, I am committed to representing the interests of Rhode Island ratepayers over the interests of National Grid’s international shareholders,” said McKee in a statement. “I embarked on this effort over a year ago to ensure that corporate savings realized from federal tax cuts would benefit hardworking Rhode Islanders – with persistence, we succeeded.”
In an initial filing in October 2018, the company said that it did not think that the PUC had the authority to issue retroactive refunds related to the corporate tax rate cut in 2017, arguing that such a decision would “constitute impermissible single-issue ratemaking.”
In a statement Wednesday afternoon following the announcement of the settlement, the company struck a different tone, saying,”We have always said that we would ensure our customers receive the full benefits of the federal tax reform legislation. Just days after the tax reform act took effect, we announced that we would be reducing our electric and gas base distribution rate proposal with the Rhode Island Public Utilities Commission by more than $25 million, reflecting more than $19 million in tax savings for our customers. In January we provided the Commission with this settlement agreement to return the roughly $7 million in taxes collected from our 800,000 gas and electric customers between January 1 and August 30 (2018) to our customers. The Commission’s approval of this settlement agreement now ensures that can happen.”
Chris Bergenheim is the PBN web editor. You may reach him at Bergenheim@PBN.com.
