CT Utility Reform Bill Passes: Here's What It Means For Customers

CONNECTICUT — The state House of Representatives and Senate passed a utility reform bill with wide support. The bill passed the house 136 to 4 with 11 legislators absent or not voting. The senate passed it 35 to 0.

There was a push for electric utility reform after Eversource’s response to Tropical Storm Isaias after hundreds of thousands of customers were left without power, some of whom didn’t get the lights back on for a week. A rate increase over the summer coupled with higher than usual residential electricity usage also caused an uproar among customers and legislators.

The state Office of Legislative Research has analyzed different aspects of the bill. Below is a summary of some parts of the bill:

Account credits for outages and food/medicine reimbursement

Starting July 1, 2021, Electric companies will need to credit customers $25 per day for customers that have outages for more than 96 consecutive hours.

Residential customers can also be compensated with $250 for food or medication that expires or spoils for outages lasting more than 96 consecutive hours after an emergency.

Electric utilities won’t be able to recover the costs of reimbursement through rate increases.

Financial performance incentives

The state Public Utilities Regulatory Authority will have to consider financial performance-based incentives and penalties tied to specific metrics. The proceedings must start by June 1, 2022. The metrics will be tied to safety, grid reliability, emergency response, cost efficiency, affordability, communication with municipalities and other goals.

PURA will also get another 200 days to consider electric and gas rate increases and 50 days for other regulated utility price increases.

Executive compensation

The bill requires PURA to consider whether rate recovery that goes to company executives should be dependent on the company hitting performance metrics.

Potential rate decrease

PURA has the option to consider reducing electric rates on an interim basis, establish low-income rates and economic development rates. PURA would need to hold a hearing and find that electric companies are collecting rates that are more than “just reasonable and adequate.”

Mergers

Any PURA-regulated utility would need to have a proportional number of Connecticut-based members on its board of directors equal to or greater than the company’s service area.

Increased penalties for emergency response

PURA will be able to raise the limit on penalties for failure to comply with standards of acceptable service in emergency preparation. The limit will go from 2.5 to 4 percent of a company’s annual distributed revenue.

Analysis of emergency response

Electric utilities will need to provide PURA with and the state legislative energy and technology committee with a report about how it has responded to the last five storm events that fall within the three to five categories. It must include cost benefit analysis.

Minimum staffing

PURA will be able to establish minimum staffing levels after reviewing electric utility emergency response reports. Minimum staffing standards could reflect a storm’s anticipated severity.

Microgrid grants

State grants for microgrid projects would be expanded. Current they are allowed for critical facilities, but under the bill they could also be used to support grid resilience projects.

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