Electric Rate for Heat Pump Users

CMLP offers the R-7 “Electric Resistance & Heat Pump Heating Systems/DHW” rate for heat pump users. This special winter rate is designed to prevent an unintended spike in electricity charges for electric heating customers as a result of CMLP’s tiered rate structure. This rate may benefit you if you already use more than 657 kilowatt-hours in some winter months, or if you expect to do so once your heat pump is installed.

However, in order to take advantage of this rate, you must request that a separate meter be installed by CMLP. This meter will record the electric usage of your heat pump. Electricity use recorded on this meter from October 1st through April 30th will be subtracted from the normal billing meter and billed at the lowest (tier 1) rate of at $0.15911 per kWh. From May 1st through September 30th, the use through this meter will be billed under the regular R-1 Rate, which ranges from the tier 1 rate of $0.15911 to the tier 3 rate of $0.19151 per kWh, depending on how much electricity your household has used that month. CMLP’s R-1 rate schedule describes how your electric rate changes depending on how much electricity your household uses in a given month.

CMLP will supply and install the separate meter at no cost to you. However, you will need to pay an electrician to install a meter socket for the new meter. An additional electrical panel is typically needed as well. Costs for a meter socket/electrical panel can range from $1,000 to $4,000. The time it will take you to recoup the cost of the new meter socket/panel through electricity cost savings depends on several factors:

  • the socket/panel installation cost;
  • the extent to which your electric usage exceeds 657 kWh per month once your heat pump is installed and
  • how long the tiered rate structure and the Electric Resistance & Heat Pump Heating Systems/DHW rate remain in effect. The CMLP Board has stated an intent to replace the tiered rate structure with a time of use rate structure, once all CMLP meters are replaced. The meter replacement project is slated to begin in 2022. Once all meters are installed, the Electric Resistance & Heat Pump Heating Systems / DHW rate may be discontinued. If that is the case, it is unlikely that you would recoup your investment in a new meter socket and electrical panel through electricity cost savings.

Please note also that customers who have a solar array usually expect that solar electricity will lower the portion of their electric bill attributable to the electricity needed to power their heat pump during the winter. However, if a heat pump is separately metered so that a customer can receive the Electric Resistance & Heat Pump Heating Systems/DHW rate for winter usage, CMLP is unable to offset the winter usage measured by the separate meter with solar electricity generated by the array. Therefore, having a solar array will not lower a customer’s winter bill for heat pump electricity usage if the Resistance & Heat Pump Heating Systems/DHW rate is in effect. However, during the summer, when the Resistance & Heat Pump Heating Systems/DHW rate does not apply, solar electricity will offset the portion of an electricity bill due to a heat pump being used for air conditioning, even if the heat pump is separately metered.

In addition, heat pump customers with solar would need to locate the second meter on the line (street) side of the existing house meter in order for the solar electricity powering the heat pump to be accounted for properly. This can require longer wire runs that increase the cost of the meter socket installation.

Please consider these factors when deciding whether to invest in a separate meter/electric panel. If you have further questions about the Electric Resistance & Heat Pump Heating Systems/DHW rate, please contact Laura Scott, Power Supply and Rates Administrator, at (978) 318-3102 or LScott@concordma.gov.