As it has occurred everywhere, the pandemic has affected everything in Connecticut. From supply lines to manufacturing to staffing, there have been significant changes to contend with and navigating this environment has been treacherous for businesses. Now, the sharp increase in utility rates has only made things more difficult.
2022 has seen significant changes to the electricity costs for businesses across Connecticut. As of January 1, United Illuminated raised rates by as much as 26% and it is already having a negative impact on expenses. Even worse, the Eversource rate hike is as high as 53% and businesses are scrambling to find a solution to bring the costs back to a more manageable level. Energy supply contracts can help alleviate the pain temporarily but it is a temporary fix. The higher costs will surely be passed on when the contract term ends and the renewed agreement resumes.
For a small motel spending $3K/month on electricity, this may equate to having an additional $750 per month to contend with. At $79 cost per night for a room, the motel would need to rent ten additional rooms per month just to pay the increase in electricity. The hospitality industry has been hit especially hard during these times and this increase in electricity costs may be the breaking point for many businesses.
One option businesses may consider is the new set of incentives for battery storage used to offset the supply side of the electricity costs. By itself, the battery solution is eligible for a 19.5% federal Investment Tax Credit (ITC). There is also the opportunity of energy credits and rebates to be taken as a whole up front or earned over 15 years. In addition, if paired with a new or existing renewable energy source on the facility, the ITC will be 26%. This is an option businesses should definitely consider to help alleviate the rising costs of electricity.
Most renewable energy providers have become quite proficient at determining accurate costs and benefits from the initial assessment with little effort from the business. This provides organizations options not previously recognized to proactively lower electricity costs and to stop being subject to annual rate hikes.