Residential electricity ripoff accelerates for the first time in five years
Electricity sellers charged Maine households $175 million more than the going rate for electricity from 2012 to 2020, driven largely by predatory marketing practices.
Since 2015, this amount had dwindled annually, until last year, a period of unprecedented economic upheaval and hardship due to the COVID-19 pandemic.
Including an estimate for small businesses, the total is nearly $30 million last year and $226 million back to 2012.
Electricity retailers — called “competitive electricity providers” in state law — charged Maine residential customers $20.5 million more than the average standard offer rate in 2020, according to analysis of the latest annual data from the U.S. Energy Information Administration.
These retail suppliers, led by Electricity Maine, enrolled customers in 2011 and 2012 by offering savings with fixed one- or two-year contracts.
But since 2014, the average retail supply price has consistently been higher than the average standard offer rate across Maine’s three main electricity service territories.
The reason retail suppliers took a greater share over the standard offer during the last year isn’t because they enrolled more customers, but because the standard offer rate dropped faster than their average rates.
In fact, enrollment with retail suppliers has dropped steadily in recent years, according to data from the Maine Public Utilities Commission.
In most years since 2012, the rate of almost all retail suppliers has exceeded the average standard offer rate. In its first year, Electricity Maine did beat the standard offer, but never again. Since, only smaller suppliers have had a lower average rate.
Since 2012, Electricity Maine has dominated the market in Maine, though its customer count has dwindled from a peak of 136,796 in 2013 to 36,085 last year.
By far, Electricity Maine has charged customers the most over the going rate for power since 2012.
For the most part, those suppliers are offering the same mix of electricity generation as the standard offer. However, about 5 percent of the 88,000 customers signed up with CEPs last year signed contracts with companies that exclusively offer clean or renewable energy supply, which could charge higher rates for those attributes.
The retail power industry argues this makes it hard to compare standard offer rates directly to retail supply rates.
If a company were to offer power from fossil-fuel generation and renewables, it is not required to detail what share of its power supply came from which sources — only that it offers these different plans.