The slice of Connecticut that prefers a hands-off, standard approach to electricity pays about 9 cents in generation fees for every kilowatt hour they use. But about 20,000 customers who chose Shelton-based Discount Power for service pay almost 22 cents — for the exact same kilowatt hour.
And they have plenty of company. Three hundred consumers are paying 21.7 cents to Palmco Power, another third-party power supplier. More than 2,400 are paying 20.4 cents to Perigree Power. A Xoom plan with 3,440 residents bills at 18.9 cents. And a Starion Energy plan with 10,150 members costs 18.97 cents per kilowatt hour.
In all, more than 140,000 Connecticut Light & Power customers are paying more than 14 cents per kilowatt hour.
The latest figures were released Thursday by Connecticut Light & Power — the state's largest electric distribution utility — and the state Office of Consumer Counsel to alert consumers who might not know they are paying the unusually high rates.
The data shows that, while the utilities' standard service plans jumped 20 percent to about 9 cents a kilowatt hour, and 40,000 are paying more than 18 cents — double that basic standard offering.
"This kind of rate shock can really hit customers in their wallets, as this can be up to approximately $100 more per month than the standard offer rate for the average residential customer," Consumer Counsel Elin Swanson Katz said in a written statement.
The high-price-tag plans likely carry variable rates, which are increasing as companies pass along higher costs caused by constraints in the region's natural gas pipelines.
A recorded message at Discount Power's office Thursday explained the increased prices as a "result of the unusually cold weather" and record high "natural gas prices in New England."
"Since the majority of electricity we use … is produced from natural gas, electricity prices have increased dramatically, and we have been forced to pass those prices onto you, for those customers who pay a variable rate for their electricity," said the message. "Our variable product was created to rise and fall with the wholesale markets, and when the wholesale market goes down so does your price."
It's also possible that some of the plans carry a premium because of higher-than-required amounts of renewable power, though that information wasn't contained in the data released Thursday.
The warning from state officials comes months after the state considered, but ultimately rejected, a plan to auction off standard service customers into the competitive market. Third-party prices come in all over the place, some undercutting the standard offer while others much higher. On the state's website Thursday, more than a dozen fixed-rate plans were cheaper than the standard utility offer, the lowest at 7.79 cents from Dominion Energy Solutions.
The state essentially created the market for third-party power in 1998 when it forced Connecticut Light & Power and United Illuminating to unbundle power generation from the rest of their businesses, which required them to sell off their power plants. Since then, residents and businesses have been able to select which company they buy their power from, while the utilities still deliver it.
Katz and Attorney General George Jepsen urge residents to review their electric bills or contact their electric suppliers for information on their rates. The state Department of Energy and Environmental Protection runs a website with rates at http://www.ctenergyinfo.com.
"When shopping for electric generation services, in addition to comparing the price offered, know whether you are considering a fixed rate or a variable rate product," Jepsen said in a written statement.
He tells residents to be on the lookout for any termination fees, for what happens when the term ends for a fixed-rate plans, for how often variable rates are subject to change, and for whether there is a price cap. "Be especially cautious if you cannot get clear and satisfactory answers to these questions," Jepsen said.
Correction: A previous version of this story incorrectly stated the price of one of Starion Energy's rate plans. It is 18.97 cents a kilowatt hour, not 18.8 cents a kilowatt hour.