State regulators have been investigating the utility companies and how they responded after Tropical Storm Isaias and determined that Eversource Energy and The United Illuminating Company didn't meet "certain acceptable performance standards in preparing for, and responding to, the storm" and will consider
levying fines against one or both of the utilities.
PURA is also ordered a reduction in the profit of both companies as an incentive for corporate management to properly prepare for future storms, and it also ordered both utilities to undergo comprehensive management audits.
Connecticut’s Public Utilities Regulatory Authority said it will require Eversource and UI to modify their rates "in a pending or future rate proceeding to reflect a downward adjustment of 0.90% and 0.15%, respectively, in their allowed rate of return on equity (ROE)" to align the company's management performance in future storm response efforts with their financial performance.
The storm knocked out power to hundreds of thousands of homes across the state last summer and power remained out for many for a week.
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PURA released a statement on Wednesday, saying Eversource "exhibited multiple deficiencies, failing to satisfy established performance standards for managing its municipal liaison program, executing its Make Safe responsibilities, communicating critical information to its customers, and failing to meet its obligation to secure adequate resources in a timely manner to protect the public safety and to provide for the overall public interest."
The regulatory authority said the company's "inactions or deficiencies created a significant risk to public safety."
PURA also said UI’s performance "was underwhelming in certain areas, but was still markedly better than that of Eversource."
They found that UI secured and deployed adequate line crews for the storm, in communities such as Bridgeport, but the company failed to meet all of its Make Safe obligations and failed to meet its public safety obligations in responding to the highest priority calls.
PURA will be ordering enhancements to the company's response plans to ensure and will consider any civil penalties, or remedial or enforcement orders.
PURA will be requiring "comprehensive management audits to be performed on Eversource and UI" by an independent, third-party firm this summer.
This comes after PURA, which oversees regulation of Connecticut electric, gas, water, and cable companies, released a report last month that said Eversource didn’t meet acceptable standards while United Illuminating mostly did and they would consider fines and penalties for Eversource.
“Eversource failed and must regain our trust. Their failed response to Isaias put lives in danger, and left families in the dark and disconnected during a deadly pandemic. PURA’s strong decision correctly concludes that Eversource was ill-prepared and poorly managed throughout the storm crisis. PURA has rightly opened the door to strong penalties and corrective action, and we will continue to advocate for full accountability at every step of this process,” Attorney General William Tong said in a statement Wednesday.
PHOTOS: Tropical Storm Isaias Rips Across Connecticut
The focus of a series of hearings began with Eversource’s storm response in a cluster of Fairfield County towns, including, New Fairfield, Bethel, Ridgefield, Newtown, and New Canaan.
These towns said they were very hard hit. For instance, Bethel said its police department had to work off generator power for days.
The towns told the panel the biggest issue during Isaias was communication.
They explained how Eversource has a system set up where each town leader has a designated liaison they can exchange information with before, during, and after, a storm event.
The town leaders said the system worked well just a few years ago, but this time, the liaisons had a lot of trouble getting answers from their team at Eversource to provide the towns on outages and road blockages.
In response to PURA’s decision, Eversource released a statement Wednesday:
“We stand by our response in Storm Isaias as we know our thousands of employees showed skill and dedication in restoring power to customers as quickly as possible. There are many areas for improvement that we are already addressing and we continue to work in good faith with our communities, customers and regulators to improve our performance. Today’s decision deserves careful consideration and review and we are committed to moving forward in the best interest of our customers.”
UI also released a statement after the decision:
"We have PURA’s final decision and are still reviewing it in detail. However, we are disappointed that the ruling does not fully reflect the facts we presented during the proceeding, and that it imposes a penalty despite PURA’s finding that UI 'generally met the standards of acceptable performance and conducted itself prudently and efficiently.' We are mindful of the deficiencies cited by PURA, and are well aware of the difficulties that extended outages cause for our customers. However, we believe the facts clearly support that UI faithfully followed its Emergency Response Plan, and met the overall targets therein. As we consider our next steps, we will continue to use what we learned during Isaias, and from PURA’s investigation, to serve our valued customers, and to improve our readiness for and response to future extreme weather events."
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