Why is energy so expensive in the New England?

June 5th, 2013 | Posted in Blog, Economy | No Comments »

new_englandThere are several reasons but it begins with the fact that it does not have its own indigenous power supply like the coal of the south, the oil of Texas or big hydro of the Pacific Northwest.

Second, New England’s electricity grid is largely self-contained, with some power lines bringing in electricity from outside. Think of it as an island with a few strategically placed bridges. So prices in the Boston area tend to move in tandem with prices across the six-state region.

In order for New England’s power prices to drop, you first need to understand the fuel source: natural gas.

More than 40 percent of the power plant capacity within New England is fueled by natural gas, or nearly twice the national average. Natural gas tends to be pricier than coal, a fuel more frequently used in other parts of the country. Also, New England is at a persistent disadvantage because most the fuel comes from outside the region.

This reliance on natural gas has haunted New England’s electricity users for much of the past decade. But that same reliance works in favor when gas prices go down.

The real way to reduce the electric bill is simple…use less.  This can only begin with energy efficiency measures such as changing the light bulbs, upgrading home appliances, and making sure that the HVAC is properly maintained.

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