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SUMMARY OF PSNH RESTRUCTURING SETTLEMENT
AGREEMENT
- An automatic 5% rate reduction on October 1, 2000 and another guaranteed reduction
totaling a combined average of 15% - and as much as 17% for residential households - when
PSNH opened its doors to retail competition in May 2001; additional rate reductions will
occur in the future as certain "stranded" costs are paid off.
- The right for consumers to choose their electricity supplier based on price,
environmental factors, and other issues important to consumers.
- A "transition service" period of at least 21 months for large businesses.
- A "transition service" period of at least two years nine months for small
businesses and individuals, during which those who do not make a power choice will be
provided with transition service power, to allow consumers time to select a competitive
supplier.
- The end to lengthy and costly litigation between PSNH and the state.
- The issuance of up to $670 million in rate reduction bonds (securitization), a
refinancing mechanism that will help lower customers' electric rates, with additional
securitization available if needed to finance renegotiated small power producer deals to
obtain added savings.
- PSNH's commitment to sell its power plants and power supply contracts.
- A sizeable utility write-off of stranded costs amounting to over a third of the equity
in the company.
- The company bears some of the risk posed by unforeseen events such as new technology or
a recession causing a significant reduction in electricity sales.
- Programs designed to make consumers bills more affordable, including energy efficiency
and low income bill assistance programs, funded at roughly $14 million per year for three
years.
- PSNH will continue to provide power delivery services, including maintaining the poles
and wires, at regulated prices and service quality levels.
For full text of the Settlement Agreement, see the PUC Restructuring Information Page.
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SUMMARY OF GRANITE STATE ELECTRIC RESTRUCTURING
AGREEMENT
- Avoids lengthy and costly litigation between Granite State Electric and the state.
- Customers will be able to select their own electricity supplier based on price,
environmental factors, and other issues important to consumers.
- A 10% rate reduction on July 1, 1998, with another average reduction of 7% on September
1, 1998.
- Provision for competitively procured Transition Service to allow consumers time to
select a competitive supplier. Transition service will be available for two and a half
years of choice.
- Default Service will be provided to those customers who do not qualify or make a choice
for a supplier.
- Provides for the recovery of "stranded" costs
- Granite State Electric will continue to offer energy efficiency programs to its
customers designed to reduce electric bills.
- Provides support for Granite State Electric to pursue environmental improvement,
conservation, and renewable energy projects
- Customers will be eligible to participate in a statewide Electric Assistance Program to
be developed by the New Hampshire Public Utilities Commission. Granite State Electric will
offer an Interim Electric Assistance Program until the statewide program is available.
- Granite State Electric agreed to sell its power plants and power supply contracts.
For full text of the Settlement Agreement, see the PUC Restructuring Information Page.
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SUMMARY OF NH ELECTRIC CO-OP RESTRUCTURING
AGREEMENT
In September 1999 NHEC reached a settlement with PSNH that opened the way
for NHEC to move to competition. The settlement resolved a lengthy legal dispute over the
wholesale power supply contract between PSNH and NHEC. The result of this settlement was
that the wholesale power supply contract was terminated on January 1, 2000 rather than in
2006 in exchange for PSNH receiving an early termination payment of $18 million. Disputes
over transmission of electricity by private suppliers over lines owned by PSNH's parent
company were also resolved.
- Rate decreases of approximately 22% for all customers effective January 1, 2000
- Customers may choose their electricity supplier freely based on price, environmental
factors, and other issues important to consumers.
- Allows NHEC to recover "stranded costs" at a rate fair to ratepayers
- NHEC will offer its own assistance program for low-income customers until the statewide
Electric Assistance Program is launched
- NHEC will continue to offer energy conservation and public education programs for
customers
- Default electricity service will be offered for customers who are not receiving service
from a competitive supplier.
- Transition service will also be offered in order to allow customers time to select a
competitive supplier.
For full text of the Settlement Agreement, see the PUC Restructuring Information Page.
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