Politics & Government
Power Surge: Senator Tony Hwang Tackling Skyrocketing Utilities Costs
Skyrocketing utility costs are placing an unbearable strain on Connecticut families, seniors, and small businesses.
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Each month, residents face shock and frustration as their electric bills climb, threatening financial stability and quality of life. This is more than an inconvenience - it’s a crisis that demands immediate, sustainable action. The frustration with high electric rates and impersonal customer service is palpable. If you've seen a steep increase in your bill recently, there’s a clear reason: the structure of our electric bills.
In Connecticut, your electric bill is divided into four components: supply, transmission, local delivery, and public benefits. Most people are aware of the costs related to buying and delivering energy, but the ‘public benefits’ portion, which has nothing to do with energy generation or delivery, is the root of many cost increases. This portion funds state programs for energy efficiency and assistance, and also allows utility companies to recover losses. Many ratepayers are seeing significant increases in this part of their bill.
For instance, during the COVID-19 pandemic, Connecticut implemented a moratorium on power shut-offs for non-paying customers. While other states ended these protections in 2021, Connecticut kept them in place until May 2024. This resulted in nearly $200 million in unpaid bills, costs that are now being passed on to all ratepayers through the public benefits charge.
Additionally, the state directed Electric Distribution Companies (EDCs) like UI & Eversource to enter into power purchase agreements for renewable energy, often at rates far higher than the market price. While these initiatives aim to reduce pollution and greenhouse gas emissions, they have also driven up costs for consumers.
In response to these issues, I supported Public Act 20-5, known as the "Take Back Our Grid Act," which holds utilities accountable for their performance during storms and prevents EDCs from passing through unnecessary charges to ratepayers. Last year, I backed bipartisan legislation Public Act 23-102 for current transparency in EDC billing and to further limit pass-through charges for lobbying, public relations, and political advocacy.
So, what else can be done now to address the current energy cost issues?
1. Overhaul the 'Public Benefits' Charge: This charge is effectively a hidden tax. We need accountability and transparency, and should transition these costs to the state budget process, rather than continuing to pass them onto utility bills.
2. Strengthen PURA: The Public Utilities Regulatory Authority must be fully staffed and equipped to regulate utility rates and services. I applaud Governor Lamont's recent reappointment of PURA Chairwoman Marissa Gillett, but all commissioner positions must be filled to ensure diverse perspectives and effective oversight.
3. Cap Power Purchase Agreements: Renewable energy purchases must be carefully vetted, with a proposed cap of 150% of the market rate to prevent exorbitant costs from being passed on to consumers.
4. Scrutinize EDC Business Practices: We must review the operational costs, affiliate business profits, and financing charges of EDCs as part of rate-setting decisions. Passing on unnecessary costs to consumers should not be tolerated.
Our utility companies have enjoyed unfettered market control, consistently producing profits for Wall Street investors while burdening struggling Connecticut residents. It’s critical that elected leaders and regulators work together to strike a balance between consumer fairness and the financial stability of EDCs. I will continue to fight for affordable, reliable energy solutions that ensure our residents are no longer unfairly burdened by rising utility costs.
State Senator Tony Hwang, Deputy Senate Minority Leader in the CT General Assembly, former Vice Chair of the Energy and Technology Committee and a recognized leader in balancing technology and energy with environmental sustainability. Achieving needed solutions by engaging all impacted shareholders in the decision-making process.
Video Link: Skyrocketing Utility Costs -Transparency, Accountability and Affordability
https://youtu.be/v-ezJo25jX8?si=tLBAd1EL_YqI8LQW
Paid by Hwang4Senate, Treasurer, Loretta Chory, Approved by Tony Hwang
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