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Good news for our customers
By John G. Tzimorangas/ Commentary
Thursday, February 17, 2005

Municipal utility customers do not receive standard offer service, so its expiration will not affect municipal utility rates.

I am writing to clarify that customers of the Hingham Municipal Lighting Plant will not see their rates increase after Feb. 28 due to the expiration of standard offer service, a type of electric service established by the state's electric industry restructuring law in 1998. There have been several articles in the newspapers recently discussing the increasing of electric rates throughout the Commonwealth.

Municipal utility customers do not receive standard offer service, so its expiration will not affect municipal utility rates. Likewise, municipal utility customers do not receive default service, another type of electric service established by the restructuring law that is more sensitive to short-term changes in the market price for electricity. Because the non-profit municipal utilities are locally owned and operated, and governed by local officials, they have continued to provide their customers with electricity the same way they always have, at the lowest cost possible, with a high degree of reliability. We cannot guarantee there will not be any rate increases, but changes required as part of deregulation legislation will not be the cause.

Generally, municipal utilities receive their electricity from power plants they own, from long-term contracts with suppliers, or from shorter-term arrangements, including market purchases. Restructuring certainly has changed the way municipal utilities do business, but buying electricity in this manner has helped them keep their rates stable and competitive during the restructuring period. Come March 1, there will be a change in the type and price of service received by many electric customers across the Commonwealth. Fortunately for the customers of HMLP, they will not be among them.

John G. Tzimorangas is General Manager of the Hingham Municipal Lighting Plant

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