Attorney General William Tong and the Office of Consumer Counsel are pushing back against a request by United Illuminating to increase rates 4.9%.
Tong called the $130.7 million rate hike request “bloated” and wants the Public Utilities Regulatory Authority to impose a $2 million annual penalty for the utility’s failure to remediate the English Station power plant in New Haven.
“On September 9, 2022—at a time when its customers were struggling to afford their skyrocketing electric bills—UI filed a bloated, unsupported proposal to increase its electric distribution rates by $136.5 million* over the next three years. During the next seven months of administrative litigation before PURA, the Company failed to meet its burden to justify its exorbitant rate increase proposals, despite answering over 1,800 interrogatories from stakeholders, testifying over the course of 15 total evidentiary hearings, and answering 145 Late-Filed Exhibits,” Tong wrote in his complaint. “The Company failed to demonstrate, as it must, that its proposed distribution rate hike up to 8 percent in the first rate year is necessary to provide safe, adequate, and reliable electric service.”
The Office of Consumer Counsel said that if the original application had been granted it would result in the largest total distribution rate increase ever approved by PURA. It calculated that over the life of UI’s proposed 3-year rate plan, its customers would pay a total of $357.9 million more in distribution rates than they are already paying. A review by the consumer watchdog agency found it could slash its proposed rate increase in the first year from $102.1 million to $49.2 million – a $52.9 million and more than 50% decrease.
A spokesman for United Illuminating said it’s the “first rate increase request since 2016, and below the rate of inflation.”
United Illuminating said the rate hike is necessary to “prepare and strengthen our critical infrastructure, including coastal substations, for the accelerating impacts of climate change; and align our investments with the state’s clean energy goals to enable Connecticut to meet its ambitious 2040 climate target.”
Overall, the utility is requesting to raise electric rates by as much as 8% over three years, increasing its revenues by $91.1 million in the first year alone, followed by an additional $20.1 million in the second year, and yet another $19.5 million in the third year. New rates would take effect after September 2023.
As far as English Station is concerned, United Illuminating said it is equally frustrated since it sold the station more than 20 years ago.
“To that extent, when UI was able to get control of the site, UI secured the site and began the investigation and remediation necessary. UI also has gone beyond its agreement to keep the public safe, including taking down a building next to the sidewalk when bricks became loose,” the company said in a statement. “To date, UI has invested more than $18 million to complete interim asbestos abatement in the main power plant building, including 14 boiler rooms, interim remedial measures in another boiler room, and demolition of the former Station B building. UI has, throughout the remediation process and aligned with the Partial Consent Order, submitted and received approvals and/or acknowledgements from DEEP and/or the federal Environmental Protection Agency on certain submittals and will continue to work with both agencies on approvals that are necessary to continue forward with remediation efforts.”
UI continues to work with the Lamont Administration, the Attorney General’s Office, the City of New Haven, and local stakeholders as we continue to refine overall project schedule, cost estimates, and evaluate potential remedial alternatives for the rest of the site.”