By Stephen Knowlton
From the law of supply and demand, the cost of [wires, poles, and transformers] is increasing because they are needed for the nationwide expansion of the grid driven by construction of new data centers, even though they are not being built in New England.
As I read the newspapers, listen to the news, and talk to people, it’s clear to me that the “affordability” of living here is for many of us a worrying concern. It also creates uncertainty about what might happen in the future. We are now in a time in which housing costs, food prices, and health care premiums are all rising, and support from government for essential services and major disaster recovery efforts cannot be relied on. It’s natural to wonder, and I do, if energy costs for electricity, natural gas, gasoline, etc., are also going to rise precipitously. We’ve read that electric rates in some places are rising much faster than inflation. In this report, I’d like to invite WEC members into the boardroom of their utility to get a picture of how their Board and WEC staff view the challenge of providing electric service at a fair cost.
Since I’ve been on the Board, some WEC members have pointed out that their bills seem high, especially when compared with those of Green Mountain Power, the largest electric utility serving the state. This sentiment has also been raised by some in the member survey just completed in 2025. There are reasons for this that readers of Co-op Currents may be familiar with: WEC serves a sparsely populated rural territory with few industrial customers, leading to a low revenue base to support electric distribution in a wooded landscape that is hard on electric lines in a storm. And until about a decade ago, WEC’s rate structure strongly rewarded conservation and low usage, and high users were effectively charged more per kWh, giving the impression of a high cost of electricity.
But about a year ago, we began comparing WEC’s bills in detail with those of other utilities. To my surprise, and perhaps to many of you, the typical WEC bill in 2026 is not that different from a Green Mountain Power bill for the same electric usage, as Louis Porter and I discussed in the last issue of Co-op Currents. For a monthly usage of 500 kWh, about average for a WEC member, the WEC bill is only 2.5% higher than the corresponding Green Mountain Power bill. For somewhat lower values of monthly usage, the WEC bill is even lower than the equivalent bill from Green Mountain Power. In brief, WEC’s bills do not stand out to be markedly above their peers that also serve rural areas like ours.
Nonetheless, members still may be concerned about the cost of electricity and wonder what the future may hold. Apart from California, the electric rates in New England states are among the highest in the country. Within New England, Vermont’s rates fortunately tend to be somewhat lower than those in our fellow states, but all are increasing in pace with inflation along with other causes.
Fortunately, at the time of this writing WEC does not forecast the need of a rate adjustment for at least a year, although circumstances can unexpectedly change. But there are market forces in the electric industry that are expected to drive rate increases all over New England and New York. It is not so much the cost of power purchased for our members’ use that is driving rates—we have secured long term power purchase agreements that stabilize most of our wholesale power costs—but the cost of maintaining and updating the transmission and distribution systems, the latter being the wires, poles, and transformers bringing power from substations to our houses. From the law of supply and demand, the cost of these items is increasing because they are needed for the nationwide expansion of the grid driven by construction of new data centers, even though they are not being built in New England.
One way to keep our electricity costs from rising too rapidly is to use our grid more efficiently. Much of the cost of upgrading and running our distribution grid comes from constructing it to handle the periods of heaviest use. While some grid upgrades will always be needed, WEC and other utilities will learn to spread out the usage of our grid over the course of the day to reduce the load it must bear. In doing so, the grid doesn’t need to be built to handle large flows of power, and least not right away. This could help shield members from potentially large rate increases.
Over the last year, the WEC Board has approved or is on tap to approve: a partnership for a utility-scale battery to shave the costs of peak usage, a low-income-eligible home battery program, and a new Advanced Metering Infrastructure (AMI) residential metering network. Among other attributes, AMI will allow members to choose time-dependent rates or other money-saving rates if they can adjust when they use electricity, like charging an electric vehicle. Further initiatives along these lines will be developed as our experience grows. That said, it’s hard to predict right now how much a benefit it will prove to be and how soon it will become effective in slowing the growth of rates.
There are charges imposed by the legislature and towns that also figure into your bill. These include the costs imposed by hosting net-metered solar arrays (estimated at the present time to be equivalent to 5% of our rates), energy efficiency charges to fund Efficiency Vermont, the state’s energy efficiency utility (about another 4 to 5%), an energy transformation program comprising part of the state’s Renewable Energy Standard, and town property taxes. All of these have their purpose, but they are beyond WEC’s direct control. In the end, we live in the northeast region of the country, which has higher electric costs than elsewhere. The Board and staff are aware of the need to avoid rapid price hikes in these challenging times, and will continue to use the tools we have, and the newer ones we can develop, to prioritize providing clean and reliable electricity at the lowest reasonable cost to members.