In a hot summer gripped by a pandemic and a damaged economy, rising electricity rates at Eversource spark public outrage
- Aug 3, 2020 8:50 am GMTAug 3, 2020 2:29 pm GMT
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In a sweltering summer with a pandemic spreading and the economy in tatters, the last problem Marilyn Rossetti needs to confront is an increase in her monthly electric bill.
Rossetti, executive director of the Open Hearth, a 125-bed shelter in Hartford for homeless men, said her July Eversource Energy bill was $7,100, up from $4,800 in July 2019, a 48% increase.
“It’s another blow to everything that’s happening,” she said.
At the start of the pandemic, Rosetti and her staff went to work, fearful of being infected by COVID-19, while many others adapted to home offices. They bought personal protective equipment and kept themselves and residents safe, she said. And like many other nonprofits, the Open Hearth has been unable to organize fundraisers this year, seriously squeezing its finances.
“We feel we’ve gotten through with protocols and procedures,” Rossetti said. “Just when you have a breather, you get that. It just does not end.”
The Public Utilities Regulatory Authority, pressured by state legislators who are hearing from angry constituents, halted the higher rates Friday, at least temporarily. Regulators, who approved the rate increase June 26, ordered Eversource to restore rates to those in effect June 30.
But at a time of fraying confidence about public health, record high unemployment and an economy struggling to approach a semblance of normal activity, the sudden and sharp increase -- 30% or more -- in a basic service was enough to prompt public outrage.
Eversource, Connecticut’s dominant utility, blamed state legislation that ordered it and United Illuminating to buy power from the Millstone Power Station.
Dominion Energy Inc., the parent company of the Millstone nuclear plant, won a key victory last year after lobbying to compete with wind and solar energy for state power procurement. Power generators and consumer advocates joined in opposition, calling it a subsidy that would drive up prices.
“It’s a combination of things that are making it worse,” said John Erlingheuser of the Connecticut AARP, which opposed the Millstone legislation. “We’re in the middle of a pandemic. We‘re in the middle of a heat wave. People are out of work.”
Eversource says the higher rates are due to heat waves prompting more use of air conditioners and dehumidifiers. With more workers based at home, computers also are in use longer and phones are being charged continuously.
The utility also says it was forced to purchase high-priced power from Millstone. The Waterford nuclear plant has fired back, saying its prices are one-third lower than what Eversource charges.
Many state legislators, particularly in southeast Connecticut where Milstone employs 1,500 workers, are standing by their votes backing the Millstone legislation. They have joined others in the General Assembly demanding an investigation by regulators into the price increases. Regulators say a hearing will be scheduled in August.
Rep. Holly Cheeseman, R-East Lyme, said the claim by Eversource that the rate increase is due to Millstone is a “totally erroneous assertion.”
“I welcome a public hearing and look at a very granular level how Eversource attributes their costs,” she said.
“This is an excellent power purchase agreement, and the state locked in at such a low rate,” said Rep. Kathleen McCarty, R-Waterford. “There’s a lot more to this than pointing to Millstone.”
Millstone said it needed broader access to energy markets to help it compete with natural gas, which had fallen in price and became an increasingly attractive energy source. Millstone pointed to nuclear plants that closed and said it could face the same fate without favorable legislation.
Critics called the deal a subsidy, even as Millstone denied it.
“There’s no ifs ands or buts that the legislation requiring contracting with Millstone is a subsidy,” said Charles Rothenberger, climate and energy attorney at Save the Sound. “Many of us said it would raise costs.”
Still, he said other factors such as increased electricity use by stay-at-home workers are at play. “A lot goes into this,” Rothenberger said.
Todd Snitchler, president and chief executive officer of the Electric Power Supply Association, said Connecticut consumers should be paying far less due to low-cost natural gas and renewable energy. He said “legislative meddling and utility deception have created a nonsensical situation where more expensive power has been subsidized” in a deal that drives up prices and undermines competition.
“The March 2019 decision made to prop up Dominion Energy’s Millstone Nuclear Power Station guaranteed revenue to the utility, even though stakeholders, consumer advocates and environmental interests warned it would increase rates,’” Snitchler said.
Millstone says its power is being sold for 4.999 cents a kilowatt hour, the lowest price for carbon-free power in Connecticut and one-third lower than Eversource’s standard offer.
Tricia Modifica, a spokeswoman for Eversource, said the utility cannot sell the power it buys from Millstone to customers because Connecticut’s energy system is deregulated. Eversource is required by state law to buy power from Millstone and sell it back into the market at about half the cost.
The balance is added to a federal charge that Eversource said is boosting customer bills. The line item associated with the legislated support of Millstone is the largest increase, she said.
Disputes over energy policy are never simple because numerous rates apply, leading to confusion among consumers trying to figure out their monthly electric bills.
“It’s a mystery to most people,” said Amy McLean, Connecticut director of the Acadia Center, a clean energy advocacy group. “All people want to know is,’Why is my bill so high?’ It’s bigger than that. It is so complicated. It’s like health care.”
Looming over all energy debates in New England is the regional grid, ISO-New England, which faces steady criticism from environmentalists and others for moving too slowly to make zero-emission energy sources a greater priority.
Rothenberger cited an “an ongoing problem with the regional grid and the way it values energy resources,” particularly renewable energy that environmentalists say faces price disadvantages against fossil fuels due to federal rules.
A broad-based offshore wind supply would deliver savings to consumers, say environmentalists and their allies in government.
Connecticut legislators are going to be “very receptive that the problem is ISO,” McLean said.
“Then it’s not their problem anymore,” she said.
ISO President Gordon van Welie said last year the regional grid is succeeding at its primary job: making sure the electricity in the region is reliable while maintaining one of the cleanest, most efficient fleets of resources in the country.”
In the meantime, Rossetti said the Open Hearth can, at least for now, “pay this exorbitant increase.”
“But just know it will take from something more important in the work we do, like housing men, employment, recovery resources -- even food,” she said.
Stephen Singer can be reached at email@example.com.
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