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NBC News (Ct.): Breaking Down Electric Bill Rate Increases

Posted by Len Besthoff on Aug 21, 2020

NBC News (Ct.) presented an explainer on utility rate increases in Connecticut in context of concerns about recent power outages caused by storms, quoting AEE's Ryan Katofsky. Read excerpts below and the entire NBC-CT piece here. 

The power has gone back on, but some Connecticut residents have been lacking confidence in the electric utilities serving most of the state. This, after a tropical storm caused outages lasting a week or more in some cases, right after sizeable rate hikes went into effect. For Marsha and Jerry Tomlinson of Bristol, losing electricity is no laughing matter due to their medical issues. The Eversource customers said they experience outages often enough that they got a generator...

Figures from 2018 from the U.S. Energy Information Administration ranked Connecticut as having the highest average electric bills in the continental U.S. When Connecticut opened competition on the supply side of your bill two decades ago, that, along with low fuel prices, stabilized and even lowered what you pay for the electricity you use. It’s one of the reasons the supply side of your bill is now less than the delivery portion, according to Eversource...

NBC CT Investigates found what appears to be an even bigger reason you’re seeing a jump. In 2017, regulators granted Eversource increases to something called a distribution charge. It is the largest item on the delivery side of your bill. It went up roughly 56% in 2018, another 6% last year, and 5% more this year... Eversource said the recent jump in bills is partially due to people working and vacationing at home due to coronavirus, and typical increased usage in the summer months...

Right now, PURA allows Eversource and UI to earn what’s called a "return on equity" in the 9% range, which is about average, according to Ryan Katofsky, managing director of Advanced Energy Economy, a utility trade association.

“What they’re guaranteed effectively is the opportunity to earn that return on the equity investment that they make. That does not necessarily guarantee them a specific profit at the end of the day,” Katofsky said.

Both Eversource and UI have stated they look forward to hearings which begin next week so they can tell their side of the story. They note everything they have done has been either approved by or is at the direction of state regulators and legislators...

Read the entire NBC-CT piece here. 

Topics: AEE In The News