Environmental, consumer groups call on Connecticut regulators to cut UI rate
State utility regulators have something new to consider as they review a distribution rate increase request by The United Illuminating Co.
Sixteen environmental and consumer groups are urging the state Public Utilities Regulatory Authority to reduce the current fixed-rate charge on UI customers’ monthly bills. The groups’ request regarding the fixed-rate charge is part of a larger rate increase request case introduced by UI this summer. That larger case includes a plan to recover $100 million from ratepayers through distribution rate increases spread over a three-year period starting next year.
The groups making the request include such environmental groups as the Acadia Center and the Sierra Club, as well as consumer groups including AARP Connecticut and the U.S. Public Interest Research Group.
In their letter to PURA, the groups note that UI’s residential customers already pay the second-highest fixed charge — $17.25 per month — of any investor-owned electric utility in New England. The organizations are urging the fixed rate charge be cut by $6 to $8 per month.
Bill Dornbos, Connecticut director and senior attorney at Acadia Center, said reducing UI’s current fixed charge for residential customers “would not only give immediate relief to Connecticut homeowners who are struggling with high energy costs, but it would also better align our electricity pricing with our energy efficiency and clean energy policies and help grow clean energy industries that can boost Connecticut’s economy.”
Fixed-rate charges became a hot topic among Connecticut lawmakers in 2014 when Connecticut Light & Power, now known as Eversource Energy, sought to raise its monthly rate. PURA ultimately allowed an increase in the fixed charge for Eversource’s residential customers to $19.25 per month, currently the highest residential fixed charge for any investor-owned electric utility in New England.
State lawmakers responded by passing a new consumer protection law, enacted in 2015, that requires PURA to apply a new standard to fixed charges. Dornbos said passage of the law “made it clear that they (lawmakers) wanted to see fixed charges capped and reduced.”
“They clearly did not want the status quo to continue,” he said.
Connecticut’s Office of Consumer Counsel has offered expert testimony concluding that UI’s residential fixed charge should be reduced to between $6 and $8 per month to comply with the new law’s requirements, Dornbos said,
“I think the public is going to be very disappointed if that is not the outcome,” he said.
Michael West, a UI spokesman, said the fixed-rate charge “is not a question of increasing revenue.”
“Our customers have come to expect a certain level of reliability in the delivery of their electricity,” West said. “They say that reliability has a certain level of value and that is what this is for, to maintain that. They don’t want us to compromise that reliability.”
Distribution charges account for 27 cents of every dollar that UI customers are charged on their electric bills, according to West. Aside from the 45 cents of every dollar UI’s “standard service” customers pay for the actual electricity the utility buys on their behalf, distribution charges are the next largest per-dollar expenditure for customers.
The basic service charge accounts for another 10 cents of every dollar of a customer’s bill, he said.
Anthony Marone III, president and chief executive officer of UI, said during a recent interview with the New Haven Register’s editorial board that continued investment in the distribution network is in order to guarantee that electricity is available when customers want it,
“We have spent $65 million beyond what is included in this rate request,” Marone said.
PURA is scheduled to issue a draft decision on UI’s rate increase request the day before Thanksgiving. A final decision is expected mid-December.
Call Luther Turmelle at 203-680-9388.