The state Public Service Commission approved a three-year rate plan for National Grid that will lead to lower bills for its customers.
The agreement, announced Thursday, takes effect April 1 and runs through March 31, 2016.
A typical monthly residential electric bill will decrease by an average of 6.6 percent in the first year of the agreement, then rise by an average of 3.3 percent and 2.1 percent, respectively, in each of the following two years.
“Due to the sharp decrease in the first year, electric delivery bills through 2016 will remain lower than they are today,” the PSC said in a statement.
In the public comment period leading up to the PSC’s decision, business groups applauded the proposed agreement for lowering customers’ bills, expanding the utility’s economic development programs and continuing investment in its power distribution network.
And economic development officials said the agreement’s three-year span would help make electricity costs more predictable for businesses.
Also under the rate plan, existing rate discounts for certain economic development programs would continue, and the electric economic development grant program will be funded at $11 million per year, up about $2 million.
National Grid’s electricity revenues are expected to increase $123 million over the life of the agreement.
But the increase will be more than offset by the expiration of $190 million in surcharges that are ending and other customer credits.
Under the proposal, a typical National Grid residential electric customer, using 600 kilowatt-hours of electricity a month, would see the monthly bill drop from $82.49 today to $77.05 during the first year of the agreement.
The typical bill would then rise by 3.3 percent to $79.57 during the second year and by another 2.1 percent to $81.24 during the final year of the proposed settlement.
“We are pleased to provide further bill reductions to our customers,” said Ken Daly, National Grid’s New York president, in a statement.
“This plan expands on recent rate reductions and holds energy costs steady for our customers while enabling us to continue to increase infrastructure investment.”