From the Hartford Business Journal
The sudden departure of Connecticut’s top utilities regulator last week has cast a pall of uncertainty over the Public Utilities Regulatory Authority and its pending docket of cases involving some of the state’s largest suppliers of electric, gas and water services.
PURA Chairwoman Marissa Gillett announced her resignation last Friday after facing several legal challenges to her leadership from utility companies along with calls for her removal from Republican state lawmakers. Her departure leaves the authority with just two sitting members — Vice Chair David Arconti and Commissioner Michael Caron — less than half of its statutory size of five.
Gov. Ned Lamont has yet to name Gillett’s successor as chair of PURA, and his promise to lawmakers to fill the remaining vacancies at the authority by the end of this year now faces even more urgency.
“I need some folks with really strong analytical capabilities,” Lamont said earlier this week, adding that recent headlines and turmoil swirling around the agency had complicated his recruiting effort. “People are worried about lawsuits and impeachment, so there’s some hesitancy. But we’re going to get it done as soon as we can.”
“It’s not for lack of will, it’s just trying to get the right person there,” he added.
The shakeup also opened new questions about whether PURA, with just two members, can vote and issue final decisions on rate cases or other pending matters. Currently, the authority is scheduled to issue final decisions later this year in three major cases: requests to raise utility rates by United Illuminating and Yankee Gas, as well as a proposed sale of the Aquarion Water Company to the South Central Connecticut Regional Water Authority.
While Gillett initially announced that her resignation will take effect on Oct. 10, she later agreed to recuse herself from those pending cases after facing pressure from utility officials to do so.
A spokesperson for PURA did not respond to requests for comment this week.
Rob Blanchard, a spokesman for the governor’s office, called the issue “a bit of a gray area.” Lamont’s staff have sought additional clarification on the law from the Attorney General’s office, he said, but are operating under the presumption that three members are needed for a quorum and that the governor will have to appoint at least one new member by Oct. 10.
A spokeswoman for Attorney General William Tong’s office said Thursday it has yet to weigh in on the matter.
Representatives of both of the major utility companies with cases before PURA, meanwhile, urged the authority’s remaining members to resolve those matters through negotiated settlements that could make the questions around the quorum issue moot.
“The conduct of agency leaders, including the chair, remain significant issues in Connecticut state courts,” Eversource spokeswoman Jamie Ratliff said in statement. “The circumstances of the past few days are unique and are unfolding as critical decisions affecting gas, water, and electric customers are being adjudicated before the agency. It is important that this work continues. We are ready to collaborate and discuss resolutions to these matters, including negotiated resolutions, in order to avoid additional litigation and to move the state forward.”
In addition to its electric utility, Eversource owns both the Yankee Gas Company and Aquarion Water Company.
Cheryl Kimball, an attorney representing United Illuminating, made a similar plea during oral arguments in the company’s pending rate case on Thursday. The arguments were heard by the two remaining commissioners, Arconti and Caron.
“This is a significant factor counseling toward a consensus resolution,” Kimball said. “If there is a consensus resolution, there is no appeal and the questions on quorum are avoided.”
UI’s request for a $105 million rate increase is currently at the front of PURA’s pending docket. Before Gillett’s resignation, the authority released a draft final decision on UI’s request that would instead increase the company’s revenues by $28.6 million.
In response, UI’s Chief Executive Frank Reynolds publicly warned that PURA’s proposal could force the company to cut its investments in the local electric grid, resulting in worse reliability and longer outages during storms. In a filing with PURA, the company also said it would have to lay off 71 employees due to the loss of revenues.
During arguments on Thursday, Kimball went even further to attack the authority’s proposal, which she said was “fully compromised” by Gillett’s leadership. “Signing off on any part of this decision will simply buy PURA more new litigation,” Kimball said.
In order to avoid such an outcome, Kimball said the company was willing to negotiate a one-month extension to PURA’s Nov. 1 deadline to issue a final decision on the rate case to allow for more time to reach a settlement. A UI spokeswoman said Friday the company planned to file a motion for such an extension as soon as next week that would allow the utility to collect any new rates retroactively.
If no extension is agreed to or PURA does not issue a final decision in the rate case, then UI’s original request for a $105 million increase would take effect on Nov. 1, according to the spokeswoman, Sarah Wall Fliotsos.
Such an increase would raise utility bills for UI customers by almost 10%, according to estimates from the state’s Office of Consumer Counsel, which represents utility customers before PURA.
The head of that office, Consumer Counsel Claire Coleman, said on Thursday that she was open to having discussions with UI and other interested parties — which include the Department of Energy and Environmental Protection and cable companies that utilize UI’s utility poles — about a possible extension. Absent such an agreement, however, she said the remaining two commissioners still have the power to render their own decision.
“In the face of all the noise around this decision, we’re hoping that the authority is able to focus on the legal standards and the evidence,” Coleman said.
In addition to the UI rate case, PURA is also considering Yankee Gas’ request to increase revenues by $192 million, or more than 26%. That is the largest such request by any gas company in the state over the last two decades, according to PURA.
In a draft decision released days after Gillett announced her plans to step down, the authority instead proposed a more modest increase of $41.5 million, or about 5.7%.
Ratliff, the Eversource spokeswoman, said in statement that the company is continuing to evaluate the proposed decision.
“It’s our obligation and responsibility to make sure that the system remains safe and reliable, and in order for that quality of service to continue, we must be able to make the necessary investments,” she said. “Certain aspects of this rate decision hinder our ability to continue to provide the same level of service.”
PURA has yet to issue a draft decision on the third major pending utility case involving the proposed sale of the Aquarion Water Company. Critics of the sale, including Tong and the Office of Consumer Counsel, argue that the sale could result in higher water rates for the utility’s 685,000 customers in Connecticut.
Those cases included thousands of pages of briefs, public comments and financial documents submitted by the utilities and other interested groups.
Gillett’s departure has also renewed criticism of Lamont’s decision to avoid making additional appointments to PURA during her tenure.
Lamont appointed Gillett in 2019 and since then has made one additional appointment, Arconti, to fill the seat left by the retirement of former Democratic Commissioner Jack Betkoski. Caron, the board’s only Republican, is serving out a term that formally expired in 2022.
“We’ve reached a point where that authority can no longer operate, and electric rates are no lower, and in fact they are higher than they’ve ever been,” said House Minority Leader Vincent Candelora, R-North Branford. “And I think a lot of this is by the governor’s own doing.”
Rep. Jonathan Steinberg, D-Westport, who co-chairs the legislature’s Energy and Technology Committee, said he was unsure whether the law would allow PURA to operate with just two appointed commissioners.
But Steinberg was also an ardent support of Gillett’s leadership, and he said that her loss had “effectively hobbled” the authority.
“I don’t like the look of it,” Steinberg said. “With decisions that are as important as the ones before them, I don’t think with only two commissioners we are looking at the kind of accountability that Connecticut residents are counting on.”
Read the Hartford Business Journal Article