Massachusetts customers of two major electric utilities may be seeing a dramatic spike on their electric bills starting this month.
The first, National Grid, has already received approval for a 37 percent increase that takes effect this month. Another major energy provider, Nstar, is now following suit, asking state regulators for an average 29 percent increase in electric bills starting in January.
“When it gets cold in the Northeast, many people use more natural gas for heating... That means there’s less natural gas left for electricity generators, so they have to turn to more expensive ways to generate electricity," explained professor of Energy Economics at MIT's Sloan School of Management,and Director of MIT's Center for Energy and Environmental Policy Research Christopher R. Knittel.
Meanwhile, gasoline and home heating oil prices are dropping. And while these price decreases may be good for consumers' pockets, Knittel says they're not as great for the environment.
“There’s really good evidence out there that suggests that when prices fall, consumers switch to less fuel efficient vehicles that are larger and have more horse power," he said, referencing gasoline prices, which are at their lowest levels in nearly four years.
In the meantime, energy consumers shouldn't be expecting too many decreases on their electricity bills.
"If we have another winter with the polar vortex I wouldn’t be surprised if electricity prices went up again next year,” said Knittel.
You can listen to the entire interview with Christopher Knittel above.