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    Friday, May 03, 2024

    Eversource, UI set to increase electric bill rates after key approval

    Connecticut utility regulators on Wednesday gave final approval to a plan that will lead to an increase in the bills for customers of Eversource and United Illuminating.

    The increase is the result of an adjustment by the electric companies to customer bills with customers passed on the price of paying for state mandates and approved programs.

    UI was seeking a 12 percent increase, which would have increased the revenue adjustment portion on the average residential customers' bills by $26 a month. Although the final decision removed some items that both UI and Eversource were seeking to have customers pay for, the impact on UI customers' bills will be $30, spokeswoman Sarah Fliotsos said.

    "As a result of the public policy programs and policymaker decisions, UI customers can anticipate cost increases beginning in July," Fliotsos said. "As described in our recent Understand Your Bill video, these costs are pass-through costs for UI, as is 70 percent of customers' overall electric bill, and PURA's months-long process that concluded in today's Final Decision on the Revenue Adjustment Mechanism (RAM) has ensured customers are only paying for the costs of the programs. UI's new electric bill redesign, which began in the February billing cycle, will delineate these charges under the 'Public Benefits' section."

    Eversource asked for an 18.7 percent hike for the typical residential customer, which would have added about a $38 per month to residential customers if implemented in a phased in manner starting May 1.

    "We proposed a phase-in increase that would have mitigated the rate shock customers would see," said Jamie Ratliff, a company spokeswoman. "By a 2 to 1 margin, PURA voted to take advantage of a projected dip in supply prices, which was part of our proposal to reduce rate shock for customers. This means the majority of residential customers will see a significantly smaller increase on their bill, depending on usage."

    While the rate adjustment consists mostly of pass-through costs required by state policies that are reasonably designed to benefit customers, Ratliff said the size of this increase was driven by PURA pushing costs off to the future and was avoidable.

    "Last year, we actively advocated on behalf of customers to prevent this rate shock," she said. "The Public Benefits portion of the bill, combined with volatile Energy Supply costs that are at this point declining, now makes up nearly 60 percent of a customer's bill. We do not control nor do we profit from these portions of the bill."

    The increases in customers' bills will take effect July 1, according to officials with the Public Utilities Regulatory Authority. That is the same date when standard service electric customers will see the generation rates for the electricity they use change, according to Joe Cooper, a PURA spokesman.

    PURA's commissioners voted 2-1 to approve the interim revenue adjustments, with chairwoman Marissa Gillett casting the only dissenting vote.

    Neither Gillett nor her fellow commissioners, Jack Betkoski and Michael Caron, offered any comments before taking the vote. In a statement issued after the vote, Gillett said she was "disappointed" by the decision.

    "This decision could have struck a fair balance by allowing the recovery of this substantial liability over a period of 2-to-3 years, rather than just 10 months," Gillett's statement said in part. "This would provide timely recovery for the utilities and reduce the rate shock for ratepayers. Instead, customers will bear the brunt of this extraordinary volatility and anomalous conditions over the course of an unreasonably short period of time given the magnitude of costs at stake."

    The Revenue Adjustment Mechanism is an annual filing the electric distribution companies are required to submit to show the costs they expect to outlay over the upcoming year to pay for the public policy programs they are required to implement, according to Fliotsos. She said the revenue adjustment mechanism represents a pass-through of the costs to pay for these programs, with no mark-up and no profit.

    But Connecticut has among the highest electricity bills in the country, so any increase, even a pass through, will have an impact on customers.

    Standard service customers let the utilities purchase their electricity for them instead of going through a third party provider. The rates that go into effect on July 1 will last through the end of the year and are typically lower than the generation rates that residential customers pay during the first six months of the year.

    Cooper said the standard service rates for the second half of this year are still being calculated.

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