WARWICK – National Grid will pay $50.2 million over the next year to settle its disputes with electricity wholesaler Constellation Energy Group Inc. (NYSE: CEG), under an agreement approved this week by the R.I. Public Utilities Commission. That money will come from the company’s local electric customers, under a formula that has yet to be decided by the PUC.

The agreement between National Grid and Constellation – a Baltimore-based company that is the nation’s largest wholesaler of electric power and National Grid’s largest electricity provider – was approved by the panel on Tuesday in a 3-0 vote.

The companies’ disagreements over fuel-adjustment and generator-capacity charges – the subject of a Sept. 22 (public hearing – had first come before the PUC in late July, when Constellation filed a “motion to intervene” in the fuel-adjustment request National Grid had filed with state regulators the month before.

Their settlement “serves the best interests of customers by settling claims that could result in substantial costs and rate recoveries and by providing a final resolution to the civil actions,” National Grid said in a regulatory filing early last month.

The agreement could mean an increase of as much as 4.2 percent in the “Standard Offer” rate paid by most National Grid customers, according to the Boston Globe.

For the typical residential customer using 500 kilowatt hours of electricity per month, that would mean an increase of $3.95 per month. But the increase could be smaller if the PUC decides National Grid should collect the money over a period of more than one year.

That average household now faces a monthly bill of $93.44 under the National Grid rate increases approved by the regulatory panel on July 10. (READ MORE) That ruling included 21.7-percent increase that boosted the utility’s most-used “Standard Offer” rate to a record 12.4 cents per kilowatt hour.

The PUC also is considering a proposal from the company’s natural gas division that would “decouple” National Grid’s gas distribution charges from the energy costs that make up 70 percent of a customer’s bill. (READ MORE)

For additional information about the R.I. Public Utilities Commission and its Division of Public Utilities and Carriers, including the text of recent filings by local utilities and other regulated businesses, visit www.ripuc.org.

National Grid, a division of the U.K.-based National Grid plc, distributes electricity and natural gas to nearly 4 million customers in Massachusetts, New Hampshire, New York and Rhode Island. Additional information is available at www.NationalGridUS.com.