GMP to pass along tax cut
In December, the Trump administration and Congress reduced the rate from 35 percent to 21 percent as part of an overhaul of the federal tax code. The new rate went into effect on Jan. 1.
Mary Powell, CEO of Green Mountain Power, says the Vermont utility will pass "100 percent" of the savings along to customers.
Powell announced the decision last week in a written response to a letter from June Tierney, the commissioner of the Vermont Department of Public Service, requesting that Green Mountain Power reduce rates in light of the federal tax savings.
"Any and all changes from this tax law that produce benefits will be given back to our customers," Powell wrote on Jan. 10. "As I write this, the GMP team is hard at work calculating what 2018 rates would have been had the tax break been in effect at the time our rates were set. We plan to share that calculation with you and the Public Utility Commission and then return 100 percent of the tax benefit to customers. We will also include the new tax rate in future proposed rates."
The Public Utilities Commission approved a 5.34 percent rate increase requested by Green Mountain Power on Dec. 21. The next day, Tierney wrote to GMP, formalizing a discussion between the state and utility officials about how the corporate tax savings would be used.
"The Department looks forward to an expeditious assessment of these federal legislative impacts to ensure the justness and reasonableness of your company's rates," Tierney wrote.
GMP's proposed use of corporate tax savings to lower rates is part of a national trend. Bloomberg News reported last month that ratepayers nationwide would save an average of 5 percent on monthly bills.
Kristin Carlson, a spokesperson for GMP, said in an interview that a total figure for the savings is not yet available, but will be "millions of dollars." The utility will not announce how much the percentage savings for Vermont ratepayers will be until Green Mountain Power files a rate case with state regulators in April.
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