Avangrid, the parent company of Central Maine Power (CMP), reported Wednesday that it took in a net income of $881 million in 2022. That sum comes as CMP has requested a distribution-side rate increase — all while many Mainers have struggled to afford the cost of power in recent years.
Avangrid increased its net income by 25% in 2022 over the $707 million it made in 2021, according to Wednesday’s financial report. The company made an adjusted net income of $901 million last year, 16% more than in 2021.
An energy company controlled by Iberdrola, a Spanish multinational group, Avangrid has holdings in 24 states. That includes being the parent company of CMP, Maine’s largest utility. CMP has been dogged by repeated last-place rankings in customer satisfaction among similar sized utilities and the company faces a referendum this November spearheaded by the group Our Power over whether it and fellow investor-owned utility Versant will be allowed to continue operating in Maine.
Avangrid’s profits last year came amid rate hikes for Mainers, with some people experiencing a monthly bill that increased by hundreds of dollars.
Power bills are divided into the supply rate and the delivery rate, with Mainers facing a price hike on both sides of that ledger. Supply rate prices are not set by utilities such as CMP but rather through a process administered by the state’s Public Utilities Commission (PUC), which “solicits competitive bids” for the price of electricity.
Beginning in 2023, the standard offer for the supply-side increased for CMP customers by 49% over 2022, raising costs by about $32 a month for the average household. The supply-side price for Versant customers increased 34% in 2023 over 2022, resulting in a bill $21 a month higher for a typical household. Part of the reason prices have risen on the supply side is because of the New England region’s reliance on natural gas, according to state officials.
Utilities like CMP have more influence over delivery prices, although such rates are subject to regulation by the PUC.
Even as its parent company took in hundreds of millions in income, CMP in August requested a 30% increase to its distribution rate, a move decried by Gov. Janet Mills and the state’s public advocate. The PUC’s review of that request is expected to extend until September. In addition, Versant — whose owner, ENMAX, has also raked in hundreds of millions in recent years — requested a 32% rate increase to its distribution prices starting this summer, which Mills has also opposed.
Those rate increase requests by CMP and Versant represent a continued pattern when it comes to the utility companies’ delivery prices. CMP’s delivery rates rose 11.5% in the summer of 2021 and Versant’s went up by around 17% in November of 2021. As Beacon previously reported, financial disclosures show that CMP and Versant’s parent companies both saw large profits amid those rate hikes.
In a press release this week on its 2022 financial report, Avangrid stated that “results for the full year and fourth quarter mainly benefited from the execution of rate plans in New York and Maine, which were more than offset by increased depreciation expense, business expenses and finance costs.”
Our Power — the group running the referendum campaign to replace CMP and Versant — criticized Avangrid’s financial report Wednesday, arguing that the hundreds of millions the company made in net income has come in part at the expense of customers in Maine.
“Good times for utility corporations. Not so much for their captive customers,” Our Power tweeted. “Avangrid boasts that results ‘benefited from the execution of rate plans in New York and Maine.’”
Our Power’s referendum will appear on the ballot for voters to consider in November. As Beacon previously reported, the measure asks Mainers if they want to replace CMP and Versant with the Pine Tree Power Company, a consumer-owned utility that would provide power to most municipalities in Maine, except the 97 towns already served by other consumer-owned utilities. The legislature passed a bill in 2021 to put the same question to voters in November of that year but that measure was vetoed by Mills, prompting Our Power to launch the referendum effort instead.
The idea to replace CMP and Versant was spurred by those utilities’ poor performances, such as the companies’ low rankings in customer satisfaction. In addition, under those utilities, Mainers have endured the most power outages of any state and the second longest period with no power. Despite that, electricity rates in Maine are the sixth highest in the country.
Along with the argument that the Pine Tree Power Company would lower rates, a point that has held true for the consumer-owned utilities that already serve part or all of 97 towns in Maine, advocates say moving away from CMP and Versant and toward public power would boost reliability for customers by allowing for investment of money into improving and updating the grid rather than a focus on profits.