CT, Mass. officials question spike in electric prices, look for solutions: 'Rate payers deserve better'

Photo of Luther Turmelle

The first in what are expected to be a series of virtual fact finding meetings on how electricity is being procured for the vast majority of residential electric customers in Connecticut and Massachusetts was held Tuesday with officials from both states urging more cooperation going forward.

Marissa Gillett, chairwoman of Connecticut's Public Utilities Regulatory Authority, said the online meeting "is the beginning of our investigation." Plans for the meeting were announced last week by Connecticut officials.

"There are opportunities for changes going forward," Gillett said.

The meeting comes as rates increased Jan. 1, with the median Eversource customer paying an extra $55.50 per month and the median United Illuminating customer paying an extra $44.50 a month. Both companies have cited skyrocketing energy prices, especially for natural gas, as the main reason for the increased cost.

Connecticut's Senate Majority Leader Bob Duff said ongoing "regional oversight is not a luxury, it's a necessity."

"Only working together can we assure that consumers have a seat at the table," Duff said.

He also criticized officials with Eversource Energy, which also serves customers in Maine, New Hampshire and Vermont. The company had several executives participating online.

"I find it inexplicable how a company the size of Eversource can't make greater use of its buying power," Duff said.

Claire Coleman, Connecticut's consumer counsel, said the current electricity procurement plan for the state's standard offer customers "was formulated in response to very different economic and energy market dynamics. " The procurement plan was initially developed in advance of the deregulation of Connecticut's electric market which occurred in 2000 and Coleman, who represents the interests of the state's rate payers, said it was last updated in 2018.

Until recently, she said, the process has largely worked well.

"Over the past seven years, our state has experienced relatively low electric supply prices, or rates," Coleman said. "In fact, since the polar vortex of 2015, we have not seen supply rates go above 11.5 cents per kilowatt hour and have usually seen single digit rates.  During this time, we have seen the six-month rates increase seven times and decrease six times."

State Sen. Norman Needleman, D-Deep River, said the dramatic rate increase is the product of "extraordinary times." Needleman is co-chairman of the Connecticut General Assembly's Energy and Technology Committee.

"When a unique circumstance happens in the market, like the one we are seeing, we need to look at the way the standard service is developed and procured," he said. "The rate payers deserve better."

James Shuckeron, director of electric supply for Eversource, said the price spikes "are a winter problem" that was exacerbated by global energy market conditions associated with Russia's war with Ukraine.

"It is not a summer problem," Shuckeron said,  "The problem we have in New England is the over-dependance on natural gas,"

Matthew Nelson, chairman  the Massachusetts Department of Public Utilities, said officials in both states need to steps that encourage "using existing (power producing facilities) in a smarter way."

"Price shocks are not good for anyone," Nelson said.

The online meeting last for about three hours, but neither Gillett nor Nelson said when a follow up meeting might take place.

Eversource has headquarters in both Hartford and Boston and serves customers in Connecticut, Massachusetts and New Hampshire.

In Connecticut, the increased electricity price increases will have an impact on the vast majority of utility customers with Eversource and The United Illuminating Co. who are signed up for what is known as the standard service offer. Customers who are signed up for the standard service offer agree to let UI and Eversource purchase their electricity for them. 

The electric distribution companies are not allowed to add any further charges for having procured the electricity to the generation portion of customers' bills. Individual customers also have the option of finding a third party energy provider for themselves, but the vast majority traditionally have not done so in the past.