The Public Utilities Board has approved an increase to electricity rates for Newfoundland-based customers, following a review of how much it costs to burn oil at the Holyrood generating station. 

Effective July 1, electricity rates will go up by 2 per cent. 

Newfoundland Power said in a statement Tuesday that the increase is due to this year's review of the Rate Stabilization Account. 

A review is done every year of the Rate Stabilization Account, which fluctuates over the years to match increases or decreases in the cost of oil.

Newfoundland and Labrador Hydro burns oil at Holyrood to generate some of the island's energy demand. 

"The actual amount of the increase will vary for individual customers depending on their class of service and the amount of electricity used," Newfoundland Power said in a statement. 

"Electricity rates in this province for residential customers remain among the lowest in Atlantic Canada."