Energy and heating giant National Grid announced Thursday it will slash a proposed natural gas rate hike ahead of next winter, citing the the passage of a federal tax bill spearheaded by Republicans and signed into law earlier last month by President Donald Trump.
The announcement states that Massachusetts customers can now expect to pay less next winter than originally projected, thanks to the decision to decrease a proposed rate hike by $36 million — from an $87 million increase to a $51 million increase. That’s a drop of about 41 percent.
The new tax reform cuts the American corporate tax rate from 35 percent — the third-highest in the world, trailing only the United Arab Emirates and Puerto Rico — to 21 percent.
Prominent Democrats, including Massachusetts U.S. Senator Elizabeth Warren, have denounced the Republican-led reform, labeling it as a handout to big corporations. During an interview with WGBH last week, Warren dodged questions about another energy provider, Eversource, and that company’s decision to lower rates in response to the tax cut, saying she is “very glad when companies pass along a little of the savings they got” but noted that she’d “like to see a government that doesn’t hand it all out to the richest and most powerful and count on them to toss a few crumbs off the banquet table.”
The trend of companies cutting rates, handing out employee bonuses, and raising wages in response to the tax cut has challenged Democrats who claim the tac cut will only benefit the wealthiest. Immediately after Eversource announced that Massachusetts customers can expect to see lower rates, Democratic Massachusetts Attorney General Maura Healey — up for reelection next fall — issued a press release in which she took credit for the cuts.
Healey claimed in her press release that Eversource’s decision was the direct result of her office’s December 20 filing with the state Department of Public Utilities asking the agency to recalculate a previously DPU-approved rate hike to reflect the potential corporate tax reduction. Healey’s release also touted her role as “the first attorney general in the country to publicly call for across-the-board cuts in electric, gas and water rates, following the passage of the new law.”
As for National Grid, the company made headlines this past fall when it announced that the DPU had approved its plan to slap Massachusetts residents this winter with a 34 percent rate hike, which will remain in effect through April.
The decision to cut next year’s rate hike will not affect what customers are currently paying. The company clarified in Thursday’s announcement that it is still trying to estimate how much the rate hike cut will affect customers’ bills next year but noted that it will “result in smaller impacts than originally proposed and will vary across rate classes and customer usage.”
November’s rate update was National Grid’s first since 2009. The company attributed the hike to a need to “update natural gas distribution prices to support significant investments in the system that serves the heating and cooking needs of 908,000 Massachusetts customers.”
Cordi O’Hara, president and chief operating officer of National Grid in Massachusetts, said in a prepared statement that the company is “committed to ensuring that the tax savings of the legislation are fully realized and are used to help our customers in their energy bills.”
“We’ll continue to seek opportunities to provide this benefit to all of our customers,” she added.
National Grid also plans to reduce planned rate hikes in Rhode Island and New York.
The gas tank in Dorchester 
