Connecticut Light & Power is seeking a rate increase to customer electric bills for the first time since 2010.
The power company has filed with Connecticut's Public Utilities Regulatory Authority (PURA) to increase electricity rates to 5.9 percent, CL&P announced late Friday morning. CL&P said the rise in rates is necessary to cover increases in equipment and material costs, property tax hikes and "targeted investments" to improve the reliability of the power grid. For the average customer using 700 kilowatt hours a month, that would amount to $6.76 more a month, according to CL&P.
“Last year, we had our best reliability year in over a decade, thanks to changes we’ve made on the system,” Bill Herdegen, CL&P president, said in a statement. “Our targeted investments are helping to build the electric grid of the future – one that is more reliable, more resilient and more efficient. In addition, we have worked hard to hold the line on rising operating costs, which has resulted in overall savings for our customers.”
PURA needs to review and approve the request before CL&P can raise its rates.
Connecticut Attorney General George Jepsen said in a statement that his office will be at the hearing to "urge PURA to approve rates that are no more than just and reasonable, as required by law."
"Connecticut's electricity rates remain extremely high. Any and every proposal to increase those rates must be thoroughly scrutinized," Jepsen said. "While I understand the need to upgrade infrastructure and resiliency following the major storms our state has experienced, every proposed expense must be – and will be – carefully reviewed and evaluated."
CL&P identified capital investments in "electric infrastructure" as the source of the power company's "$117 million operating deficiency," according to CL&P. That includes costs incurred to install "new and stronger poles," wires and transformers, as well as upgrades to substations, according to the news release. CL&P also spent funds on "smart switches" to decrease power outages. The power company plans to spend more than $726 million on installing and upgrading electric distribution facilities in the 149 Connecticut towns it serves.
CL&P said that power outages have decreased and that the state's power system "performed at its highest level in 2013" since 2000. The company has reduced $36 million in operating and maintenance costs as a result since 2012, CL&P said.
The rate change request takes into account PURA mandates following major catastrophic events like the October snowstorm in 2011 and Hurricane Sandy in 2012 that caused thousands of power outages, CL&P said.
"Those storms wiped out power to hundreds of thousands of customers across the state. Although PURA disallowed a portion of CL&P’s storm costs, it ultimately approved storm recovery over a six-year period beginning on December 1, 2014, with $89.5 million in the first year as part of this rate request," the news release stated.
Herdegen praised CL&P employees' work to improve "service and reliability" to customers since "the devastating storms of 2011."
“We look forward to working with regulators to ensure we continue these higher standards and meet growing customer expectations in today’s digital age," Herdegen said.
If approved, the increase will take effect Dec. 1.