(Updated 4:22 p.m.) In an attempt to extend an olive branch to its customers, Northeast Utilities announced Tuesday that the company will be increasing its post-storm fund from $10 million to $30 million and crediting customers without power for a week.
The fund will provide residents with a $100 to $200 credit if they were still without power at noon on Saturday, Nov. 5, a week after the pre-Halloween snow storm started on Oct. 29. The size of the credit will depend on how many people apply or are identified as customers without power for a week or longer.
The average electric bill for residential customers is around $95 per month, so the credit amounts to about a month of free electricity.
Northeast Utilities spokeswoman Marie van Luling said the company set “big expectations for restoration which it didn’t meet.” She said the fund will only be for customers who were without power for a week or longer during the October Nor’Easter and does not apply to customers without power during Tropical Storm Irene. She said the company was able to meet expectations for restoration during Irene.
“As we heard from our customers and had discussions with Governor Malloy and his staff, it became clear that the original sum we proposed, $10 million, was insufficient,” Charles W. Shivery, NU president and chief executive officer, said in a press release. “While this storm was unprecedented, we set very high expectations for the performance of Connecticut Light and Power (CL&P). Clearly, we did not meet a number of those expectations.”
Kenneth Feinberg, who designed and administered the September 11 Victim Compensation Fund, will help administer it. Feinberg agreed to help NU administer this post-storm fund at the request of Gov. Dannel P. Malloy.
“I applaud the company and the Governor for working together to create a process that is simple and fair,” Feinberg said in a press release.
In a phone interview, Feinberg said Malloy called his office a few weeks ago after learning he was working with Indiana Gov. Mitch Daniels on figuring out compensation for the fairgoers who died or were injured in August when a wind gust blew down a stage. Feinberg, who is working probono, said October snowstorm is very different, but that he was happy to help the citizens of Connecticut.
He said it’s understandable that residents without power for less than a week will be angry they don’t qualify for the program, but in compensating individuals “you have to decide how you can help the most amount of people in need with a finite amount of money.”
He said he thinks the utility may have difficulty with the issue of proof, but he also opined that hundreds of people who qualify won’t apply for the program. As with every program there will be a huge number of people who will not apply either because they know about it, don’t believe it, or are self-sufficient and don’t need to, he said. The reasons are as varied as human nature.
Feinberg, who helped Northeast Utilities determine the amount of the credit, said it needed to be something meaningful. He said the $100 minimum is “substantive and a real benefit.”
If fewer people apply for the program then the credit will increase, but the amount of money dedicated to the fund is finite. He said the utility worked backwards, sideways, and forward in order to come up with that number.
Malloy, whose first review of the utility’s performance is due Dec. 1, applauded its increase in funding.
“I’m glad CL&P agreed to increase its initial offer of $10 million, which was inadequate, to this $30 million figure. I see this as a meaningful attempt on their part to give some financial relief to the residential customers who were most inconvenienced as a result of an extended power outage.”
In addition, the company will also be making donations of up to $5 million to the Connecticut Food Bank, Foodshare and Operation Fuel to help them address community needs for this approaching winter season. Each organization will initially receive $1 million with additional funds determined at the close of the fund in January.
“The unprecedented storm created substantial hardships for many people, despite the extraordinary efforts of our employees and contractors,” Shivery said. “Having the confidence of our customers is important to us and, in addition to establishing this fund, we have taken a series of steps to improve performance at CL&P.”
But there were customers who were in the dark for less than a week who are bound to be upset they don’t qualify for the funding.
“I realize there will be a lot of people who were out of power for a significant amount of time who can’t apply for this money, and who will be unhappy as a result,” Malloy said in a statement. “It’s not a perfect solution, but let’s remember that this was an unprecedented storm that caused an unprecedented amount of damage. I also want to be clear that nothing that’s being announced today is going to change whatever measures may be required based on what we learn as a result of the reviews and investigations that are being conducted into CL&P’s response to the storm.”
Shivery said he welcomed the reviews of the company’s response.
“With the benefit of the various reviews under way, we will have a more complete picture and will take all appropriate actions to ensure that we are able to deliver under even extreme conditions, like those we experienced in the October storm,” Shivery said.
Rep. Pamela Sawyer, R-Bolton, said she knows there were customers out of power during both storms and was concerned that they couldn’t add up the amount of days to qualify for the credit.
Her advice to CL&P was to pay the bills of its contractors on time so that when the next storm hits they won’t be shorthanded.
“They gotta pay,” Sawyer said. “They gotta pay on time.”
The fund, NU had initially asked the state to administer, will now by administered by the company with the help of Feinberg.
The company will begin taking applications Wednesday, December 7. On that date, CL&P will begin contacting qualified residential customers to inform them of their eligibility to apply for the credit. Also at that time, qualified customers can choose to apply at www.cl-p.com or by calling 888-566-9257. All applications must be received by 5 p.m. January 31, 2012. Credits will begin to be applied to the customer’s February billing statement. No release of legal claims will be necessary in order to receive compensation from the fund.
Those customers who filed information through 211 for claims associated with the storm after the initial fund was announced will receive a credit on their bill without further application required if they are eligible.