Rates

On June 15, 1995, the Company implemented an across-the-board retail rate increase of 9.25 percent. The target return on equity was set at 11.25 percent, up from 10.5 percent. This rate increase should yield an additional $12.5 million annually in revenues.

In September, the Company filed a 12.7 percent rate increase. Early in 1996, the Company settled this rate case with the Vermont Public Service Department, enabling GMP to conduct its business and achieve satisfactory financial results without the drain on human resources and the additional costs that litigation imposes.

New England Retail Rates
Revenue per KWH (1994)

As this chart shows, GMP continues to have the lowest average retail rates among major New England utilities.

The settlement became possible when the Company negotiated a new arrangement with Hydro-Quebec that will reduce GMP's net power-supply costs below the amounts anticipated in the rate request. This rate case settlement, which is subject to the review of the Vermont Public Service Board, provides:

Projected additional annual revenues of $7.6 million.
An overall increase in retail rates of 5.25 percent.
Target return on equity for electric operations of 11.25 percent.
Recovery of $1.3 million of costs associated with the Pine Street Marsh Superfund site, amortized over five years.