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Rate hike, storm lead to calls to break up Eversource

HARTFORD, Conn. (AP) — Connecticut regulators heard calls Monday to break up the state’s largest electric utility in the wake of large rate increases and lengthy delays in restoring power following Tropical Storm Isaias.

The Public Utilities Regulatory Authority held a day-long hearing by videoconference on Eversource Energy’s rate hikes that went into effect on July 1, which led to the doubling of some customers bills. Those hikes were followed by the Aug. 4 storm that knocked out power to about 1 million homes and businesses and left many customers in the dark for more than a week.

Among the local officials to testify were Bethel First Selectman Matt Knickerbocker, Newtown Representative Mitch Bolinsky, Redding Senator Will Haskell and Wilton Representative Gail Lavielle.

U.S. Sen. Richard Blumenthal, a Connecticut Democrat, urged PURA to consider several actions including breaking up Eversource and creating a publicly owned state-based utility. He also urged regulators to roll back the rate increase, issue refunds for customers who suffered losses during the tropical storm and eliminate guaranteed profits for the company.

“I think that the time for tinkering is over,” Blumenthal said. “I think that we need to think big about becoming smaller, more responsive and smarter in the way we do public utilities and deliver power to the consumers of Connecticut.”

Gov. Ned Lamont, a former cable television executive, argued the electric utilities need to have their rate of return tied to the amount of time it takes to restore power during outages. He called on PURA to penalize Eversource and UI for poor responses and reward them when they get power restored quickly.

“The disconnect between pay and performance is shocking to me,” Lamont told the regulators. “I think the days of getting a 9 1/2% rate of return for just showing up is over.”

Eversource officials apologized for requesting a rate hike in the middle of the COVID-19 pandemic. The utility said the dramatically higher electric bills were due in large part to increased electricity usage in a hotter than normal summer, combined with people staying at home and using more power during the pandemic.

They said the rate hikes were necessary because of increases in costs from suppliers, including a state mandate requiring Eversource to buy electricity from the Millstone nuclear power plant in Waterford.

The utility posted profit of $909 million in 2019, down from $1.03 billion in 2018.

Penni McLean-Conner, the chief customer officer for Eversource, called the customer outrage deeply disturbing, but understandable.

“We realize now that in these difficult times we should have done more to ensure our customers and constituents were aware of the upcoming changes in rates,” she said.

The rate increase was temporarily suspended by the authority on July 31 amid complaints from customers and state officials.

Monday’s hearing lasted into the evening, with regulators questioning Eversource officials in details about their costs during the afternoon and then hearing from an angry public.

A woman, identified on the video call only as Pammy from Middletown, testified that her electric bill was $786 last month for a three-bedroom ranch house and is expected to go up further if the rate increase is reinstated.

“I literally cannot sleep at night and am sick to my stomach,” she said. “To pay $1,000 a month, that’s a mortgage payment.”

PURA chair Marissa Paslick Gillett said the group also has received more than 1,000 letters and emails from the public commenting on their electric bills.

Constance Atiles-Hewitt, of Greenwich, wrote that her electric bill doubled just before she lost $120 in groceries during the storm. She said Eversource should have had extra crews in place and ready to respond to the storm, which had been tracking toward the state for days.

“Your top executives sicken me and should be ashamed to pass through all these costs to the customer while lining their pockets on the back of those who have no choice but to use your expensive, subpar service which delivered no preparedness,” she wrote.

Monday’s regulatory forum will be followed this week by a legislative hearing on both the rate increase and storm response.

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Brian Kilmeade

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