Don’t think your utility rates are high enough already? Within just the past six months, two utilities that touch most Connecticut households have asked for a lot more money.
Eversource Energy just filed notice that it intends to seek a rate increase addressing a $503 million “operating revenue deficiency.” This figure balloons to $781 million if the deferred storm costs it is requesting are included.
Last December, meanwhile, Aquarion Water Company — currently owned by Eversource — told the Public Utilities Regulatory Authority (PURA) it will ask for an additional $88 million in revenues. That’s a roughly 42% rate increase.
You read that right. An increase of 35% to 54% in the distribution charge on your electric bill — the part where Eversource makes their profit. That translates to an 11% to 17% increase in your total bill. And a potential 42% increase to your water bill.
These are among the largest rate-hike requests in recent memory. And they’re arriving back-to-back, within six months, from two companies under the same corporate roof. Last year, that corporation boasted profits of $1.69 billion, upped shareholder value 23%, and raised its CEO’s compensation — already one of the highest in the nation — by roughly 20%, to $14.99 million.
That’s why state Rep. Jonathan Steinberg, D-Westport, and I have assembled a bipartisan coalition of 77 members of the General Assembly opposing these filings.
Connecticut already has some of the highest electricity rates in the country. Water and electricity are vital utilities on which we all depend. A highly profitable utility company, led by one of the highest-paid utility executives, is asking Connecticut families to dig deeper. It’s outrageous and unsustainable.
We don’t have the power to tell PURA what to do. But we can ensure they understand the stakes. It’s vital that PURA subject these filings to the most rigorous scrutiny. That means independently verifying the justification for every dime of claimed costs. The utilities have earned the scrutiny: Aquarion’s last request was rejected and replaced with a rate reduction. Its current request involves costs related to a storm response PURA found grievously deficient.
Additionally, Aquarion’s filing makes a particularly troubling argument: that PURA’s previous denial of a proposed sale to a new nonprofit authority justifies this increase. Because the sale has since been approved, the argument’s premise no longer exists. But it shouldn’t have been used as leverage in the first place. And that’s not its only attack on PURA’s exercise of regulatory authority: Aquarion’s claiming PURA’s 2022 decision rejecting a rate hike — instead ordering a $4 million decrease — necessitates an increase now.
These attacks on PURA function as an implicit threat. Approve our rate hikes and our mergers, they say, or else we’ll punish you with higher rates later. Regulators made an independent call on each of these previous cases — calls many of us consider the correct ones. Consumers shouldn’t be penalized for them. And it’s not the first time Eversource has used these tactics.
But you shouldn’t give up hope yet. These requests are just the start of the process. The outcome could be shaped by PURA hearing from residents. You can submit public comments to PURA on these dockets (25-12-12 for Aquarion, 26-05-10 for Eversource). You can watch and participate in the public hearings that follow. You should make your voice heard.
PURA must use every element of the power we gave it in the 2021 Take Back Our Grid Act, which strengthened its ability to scrutinize rate increases through performance-based ratemaking. Add to that our 2023 law enhancing rate predictability, transparency, and preventing reimbursement of utility lobbying and marketing costs, and other reforms we’ve passed since.
To be sure, there’s more we can do. We should give the Siting Council more tools to vet the utilities’ capital projects, on which they’re virtually guaranteed a 9-percent-plus return. We should increase supply, whether through hydroelectric power from Canada, small modular nuclear reactors, or “balcony solar.” We should enact the consumer-protection measures proposed by Gov. Ned Lamont.
Ultimately, however, utilities should serve Connecticut residents who depend on them, not corporate shareholders. Reliable service and infrastructure investment matter. But PURA should not hand two related companies a blank check at the same time that they are reporting massive profits and seven-figure executive raises. Clearly, they’re doing just fine — and Connecticut residents are suffering. PURA must stand tall. |
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