Despite being reliant on New England’s volatile energy market, New Hampshire Electric Cooperative is finding a way to not only limit the impact of price spikes but reduce rates.

Beginning Aug. 1, members of the Plymouth-based co-op will see their monthly bill drop an average of 6% for consumption of 500 kilowatt hours and 7% for consumption of 1,000 kWh. It’s the fourth rate cut the co-op's board has approved in two years.

“Our mission is to provide our members with affordable, reliable service, and that’s exactly what we’re doing,” said Alyssa Clemsen Roberts, the co-op’s president and CEO.

NHEC is the second-largest electric utility in the state and, with no generation and transmission co-op, buys its power from the regional market. Until recently, the co-op had set its rates based on a forecasting model and purchased an average of 80% to 85% of its power one month ahead. That practice changed in 2021 after high volatility rocked New England ISO pricing and storms, including six Federal Emergency Management Agency events, hammered the region.

“Those things are costly and put pressure on distribution rates,” said Roberts. “We found we had set the rate for the rate period too low. We hadn’t anticipated those steep price increases, and this caused the cooperative to under-recover on the power it was purchasing.”

Now NHEC buys 80-85% of its power every six months and purchases the remainder on the day-ahead market. The co-op studies multiple analyses of the rate period and its model to determine the cheapest time to purchase power, then contacts five or six generation providers to get the best price.

“This allows us to make better decisions and gives the cooperative and its members more stability and less risk,” said Roberts, who joined the co-op in 2022.

Roberts said the energy rate cuts come despite recent increases that NHEC made to its distribution charge to pay for system upgrades as extreme weather events have increased vulnerabilities to the regional grid. The increases also were caused by inflation and labor costs, among other pressures.

“If you're going to make responsible investments into your system to improve reliability and provide service, those things cost money,” said Roberts. “So, there's still some risk and volatility there, but we're much more able to control our destiny.”