The legislature’s Energy and Technology Committee heard testimony Tuesday about proposed legislation that would compensate ratepayers for almost every day they spent without power this summer following Tropical Storm Isaias. The legislation would also change how regulators look at setting rates.
“This bill reflects a lot of the urgent challenges ratepayers have been experiencing over the last few months during this pandemic including opportunities to address the economic dislocation that families and businesses have been experiencing during the pandemic,” Department of Energy and Environmental Protection Commissioner Katie Dykes said.
Tropical Storm Isaias knocked power out to more than 800,000 Eversource customers and more than 123,000 United Illuminating customers. Eversource underestimated the number of outages before the storm hit and many customers were without power for days. The performance sparked public outrage and this legislation.
“Strengthening PURA’s hand and giving us some more tools to manage the utilities and doing a little bit better job there. Holding the utilities more accountable trying to get some restitution for our residents,” Sen. Norm Needleman, co-chair of the Energy and Technology Committee, said.
He said he had hoped when they proposed making the utilities pay for spoiled food and medicine for customers who were out of power longer than 72 hours that the companies would have offered to pay for it.
“I would have hoped like ConEd in New York, they would have voluntarily jumped on the bandwagon and decided that it made sense to give people some help,” Needleman said. “It’s a pandemic and people are stocked up on medicine and food for fear of shortages. They clearly did not do that and now we’re putting it in a bill. The bill talks about it being retroactive, but we’re actually talking with legal to see if that can be done.”
One of the biggest shifts in the bill would be to performance-based rate making.
“Governor Lamont has spoken out in support of performance-based rate making as the cornerstone of the reform that’s necessary to ensure that the utilities are driven to not just to earn based on how much infrastructure they build but based on how well they perform," Dykes said.
Giving PURA the resources it needs to regulate the utilities is also part of the legislation.
“I cannot think of anything more urgent in the energy landscape in Connecticut right now than passing this bill that would help PURA bring some needed accountability and framework to the task in front of us,” PURA Chairwoman Marisa Gillett said.
United Illuminating and Eversource said they support performance-based rate setting for storm events as long as the metrics they are measured by are clear.
United Illuminating appropriately estimated the number of outages it would experience, unlike Eversource, which underestimated them.
“If you set a restoration deadline by law we must work to abide by that deadline which will come at a massive cost related to customers rates and this is something we’re all trying to avoid," Eversource CEO Jim Judge said.
“There will never be a 72-hour restoration after a major weather event of that size and scale. It’s just not possible,” Judge said.
Attorney General William Tong said Eversource needs to be paying more attention to ratepayers than shareholders and that’s part of the problem.
“Utilities should step up and compensate people for what happened in Isaias and frankly if there were mistakes made not only in Isaias, but in the aftermath of Hurricane Laura it was pretty devastating in some parts of our state,” Tong said.
The legislation would give customers out of power more than 72 hours a $125 credit.
Needleman would like to see minimum staffing levels too.
“The bottom line is they need to stop emphasizing stockholder return and stock price at the expense of having capacity and people ready to respond,“ Tong said.
Judge said the legislature needs to tell ratepayers what outcomes they would like to see. Shorter outages? Or overall restoration improvement?
“Other than really putting forward legislation to have you take a final hit what will it take for these storm communications and response times to be altered,” Rep. David Arconti, D-Danbury, said.
“To just go with a huge hammer penalties that will certainly distract us with whatever comes out of PURA in terms of performance-based rates because the consequences are very daunting,” Judge said.
But Tong said it's the only way to get them to pay attention.
“Eversource and UI provide a public service and they have a duty not just to their shareholders but to the ratepayers,” Tong said.