What to do if your electric bill suddenly spikes

By Lori Valigra, Bangor Daily News Staff

Robert Oates thought he was getting a good deal through an electricity supplier recommended by his neighbors three years ago. 

Things went south last fall when his electric bill spiked suddenly, doubling in the last six months of the year. The 79-year-old from Rockwood near Moosehead Lake used a competitive energy provider, SmartEnergy, and readily admits he didn’t read the fine print in the contract about when the low introductory rate would end and the variable rate would begin.

“It was a smart supplier and a dumb consumer,” Oates said. “Me.”

He got out of the contract and went back to the standard offer price, but not before he paid $1,200 for what he saw as the excess billing for the last half of 2022.

With supply disruptions pushing up prices sharply, regulators and utilities are getting rafts of consumer complaints from Oates and others largely centering on steep price hikes for customers of some competitive energy providers. 

Here is what experts are advising and where to go for help.

Why have prices risen so much? 

Maine and New England rely heavily on fossil fuels to generate electricity. Natural gas supply disruptions due largely to the war in Ukraine have increased the price of fuel, and in turn, electricity. Cold snaps also contributed to higher demand and rising prices.

What is the difference between competitive energy providers and the standard offer?

The electricity market deregulation of 2000 separated companies supplying electricity from those delivering it. Mainers can now choose either a standard-offer supply price, determined through a competitive bidding process by the Maine Public Utilities Commission or choose an alternative competitive energy provider, which could offer a more favorable price.

Both prices have been affected by supply disruptions. In January, the standard offer prices used by Central Maine Power and Versant Power rose by 49 percent and 40 percent, respectively, for the average residential customer. 

At the same time, customers of some competitive energy providers saw their supply rates triple. That is in part due to the market factors, but also the contracts that those consumers signed with the companies.

How can I find out why my bill spiked? 

Check your electricity bill to see when the prices increased, and whether it was by the supplier (the standard offer or a competitive energy provider) or distributor (CMP or Versant). Did you get a new appliance or heat pump that may be using more electricity? Did you have any unusual usage?

If the rise is from your competitive energy provider, call that company directly. Typically, CMP and Versant would refer you to the provider anyway because it is a separate company. If you feel you are not getting helped, contact the utilities commission and the Office of the Public Advocate.

I don’t remember being told my rates would rise. What can I do? 

Each competitive electricity provider must provide written notice to its customers two times between 30 and 60 calendar days in advance of a renewal of service, according to the utilities commission. 

The two written notifications must be made electronically or by mail, but one of the notifications must be by mail. The words “contract renewal notice” must be included in bold at either the top of a paper notice or in the subject line for notices sent electronically. 

If you were not alerted to rate changes, contact the utilities commission, its chair, Philip Bartlett, said.

“We investigate particular instances,” Bartlett said. “A competitive energy provider has to provide to customers to raise rates in accordance with our rules, or if it changes from a fixed rate to a variable rate.”

Is there anything CMP or Versant can do to help? 

Representatives for both major utilities said they are reaching out to educate customers about rates and how to manage their electricity usage. They cannot recommend whether a customer should select the standard offer or a competitive energy supplier, but they can help a customer switch back to the standard offer.

“We can’t reconcile the competitive energy provider contract, but we can help customers drop the supplier,” Versant spokesperson Judy Long said.

CMP also will help customers process the forms to move to standard offer, but Linda Ball, vice president of customer service, cautions customers to check if there are early termination fees.

“The fees can be $100 or more for early termination,” she said.

Ball said customers can learn more about their energy use through a free online app that might help them cut some usage. She also urges customers to not be afraid to call the company for information, regardless of their question.

What options do I have if I want to stay with a competitive energy supplier? 

Electricity Maine, the largest competitive energy supplier in Maine, has had some of the highest rate rises, according to complaints to the utilities commission.

The company, which is owned by Spark Energy of Texas, said it only offers fixed-term contracts for new enrollments and renewals. Customers whose contracts end can renew them on another fixed-term basis or pay month to month, said Kira Jordan, spokesperson at Spark Energy.

She attributed the recent sharp rate increases to geopolitical unrest and market issues. Customers on fixed contracts were protected from volatility, although those on month-to-month contracts saw prices rise, she said.

What other resources are available? 

The utilities commission offers a detailed explanation of how competitive energy suppliers operate and what to ask when choosing an energy supplier on its website. 

The Office of the Public Advocate explains how Maine’s electricity markets work on its website. MaineHousing explains the Home Energy Assistance Program on its website. The U.S. Housing and Urban Development website includes links for help with your utility bills.