Why Have Our Power Prices Skyrocketed?

While an overwhelming majority of the City Council, myself included, decided against Councilor Giovanni Recupero’s order requesting Acting City Manager Ned Keefe conduct a study to determine the viability of Chelsea constructing and operating its own power plant (for the litany of reasons described Monday night). However, the issue that compelled Councilor Recupero to introduce the order is one I strongly believe needs to be discussed for the benefit of the people of Chelsea.

It can not be denied that the cost of electric power has skyrocketed over the last few years; during the last few months of 2014 alone, both National Grid and NSTAR (now Eversource) announced significant price hikes for their customers. This past winter, NSTAR customers were forced to pay more for their electricity than at any time since Massachusetts overhauled its electric market in 1998.

Price hikes like those disproportionately impact low-income families, many of whom call Chelsea home. Chelsea families (and families across the country), regardless of income level, already struggle with rising food costs, stagnant household incomes, and a lack of quality full-time jobs.

The question many Chelsea residents are probably asking: why have my electricity prices skyrocketed over the last few years? For that answer, we must turn to the policies of our federal goverment, specifically President Barack Obama and the Environmental Protection Agency (EPA).

Since 2008, the EPA has passed a series of extensive, burdensome regulations that are almost completely impossible for smaller coal-fired power plants to come into compliance with. When the the EPA’s latest Mercury Air Toxics Standards (MATS) come into effect in June, an estimated 85 plants are expected to close nationwide because it would be cost-prohibitive for them to enter into compliance with MATS.

The U.S. Energy Information Administration estimates the EPA’s regulations will contribute to the closure of 60 gigawatts of electrical power by 2020. The shuttering of such a large number of power plants, in the name of combating climate change, has contributed to the rising cost of electricity that is harming so many Chelsea families.

To add more insult to injury, in a move that reeks of cronyism, the President and the EPA issued a waiver to General Electric, freeing it from the many regulations that have shut down so many other plants across the country.

Allowing a large corporation, with an unlimited political war chest and an army of lobbyists, to assist in writing regulations to shut down competition while making themselves exempt is contrary to the fundamentals of true Capitalism. When a monopoly is created in any economic sector, the company in question is free to charge what ever cost they choose, to the detriment of the customer.

By allowing our government, in conjunction with big businesses, to use burdensome regulations to shutter so many electric plants, we, ourselves, have allowed our own energy prices to skyrocket. No family should have to choose between paying their rent or paying their electric bill because of corrupt, crony Capitalism and back room deals.

I urge all Chelsea residents to speak up and demand change, or we risk a future where our children and grandchildren speak of electricity as something reserved only for the rich and politically-connected elite.

3 comments for “Why Have Our Power Prices Skyrocketed?

  1. April 10, 2015 at 1:43 pm

    Thank you for the good analysis. When you kill capitalism and free market you get high prices and bad service. What else you expect? And all this “Global warming” BS is just adding insult to injury.

  2. Gordon501
    April 23, 2015 at 6:29 pm

    Lets not forget another important factor driving electric rates higher that is also caused by state and federal regulations. Both state and federal regulations force local utilities to buy power from “Green Energy” sources like wind turbines solar power even though the utilities can generate the electricity much cheaper from conventional sources. The dirty secret about “Green” energy is that it is very expensive; power from a wind turbine typically costs 5-7 times the cost of generating power from a conventional gas fired power plant, solar power can run up to 10 times the cost of conventional generation. During his time as Governor Deval Patrick signed executive orders and passed laws that are lining the pockets of his friends in the green energy business at the expense of Massachusetts rate payers by forcing the utilities to buy this expensive power and then allowing them to pass the costs on to us.

  3. tom
    April 24, 2015 at 11:12 am

    There’s also the lack of gas pipelines into the state – most electrical generation is moving towards NG. Then of course there is the shutdown of the local nukes.

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