Electric And Natural Gas: Are We Done With High Rates?

The short answer is NO!  Is there relief in sight?  Yes.. but temporarily this summer.  As a summary, supply rates with short terms ranging from 3 to 6 months had an advantage over longer terms of 12 months and higher.  Although many who had the latter were underwater since 2020, the recovery is in progress.  The trend shows that rates are backwardated with longer terms outperforming spot and/or short-term rates.  As noted in this column over the last several months, the utility default rates are at highs unseen in decades. 

Current electric supply rates in Massachusetts and New Hampshire range from $0.15 to $0.23 per kWh and $0.11 to $0.20 per kWh respectively. Winter utility natural gas rates are averaging $0.80/therm. The fundamentals will not change with producers keeping natural gas supplies flat and an added geopolitical threat in Ukraine. The forecast shows an easing this summer, but it is anticipated that rates will rebound in November. The supply rates in 2023 will be a bit higher than in 2022. In fact, the Energy Information Administration is forecasting an increase of .6% for electric rates in 2023.

We, at Neighborhood Energy, take pride in the fact we have lowered our customers' energy spend through timely counsel and a conservative approach of budget certainty. It is our opinion that the shoulder season starting this spring will be the low water level mark to enroll and/or renew with terms greater than 12 months.

Thank you for your continued support. Your friendly Neighborhood Energy.