WASHINGTON, D.C. – Outraged over an unusually high energy bill for July, Monroe resident Lisa Squibb turned to the state’s federal delegation for answers.
“I received my Eversource bill this weekend and nearly went into cardiac arrest seeing the amount due,” Squibb wrote Sen. Richard Blumenthal’s office in an email. “I live in an approximately 2,800 square foot home, nothing fancy, all new windows within the past 5 years, updated central AC unit with the past three years, my kids are grown and moved out so there are only two of us here, and yet my electric came in at a whopping $952.59! How is this remotely possible?”
Facing bills for her own house and for her mother’s, Squibb claimed that she would likely be moving out of state at the beginning of next year.
But while state leaders have regulatory power over local utility rates, it’s Washington lawmakers who have responsibility over federal funding for energy assistance programs and for federal regulations affecting consumer bills.
The response that Squibb got back appears to have been a letter drafted for the previous year, but Blumenthal’s press office told CT Examiner the senator is not suggesting breaking up Eversource’s current natural monopoly to address last month’s rate hike, though he would prefer a locally owned and public utility.
In Blumenthal’s updated response, he said that he was shocked by the significant increase in fees added to electric bills, but noted that the rates are determined by Connecticut’s Public Utilities Regulatory Authority (PURA) and policies by the General Assembly.
“As a federal representative for Connecticut, I do not have any jurisdiction in these matters,” Blumenthal’s response said. “While I don’t have control over electric rates in Connecticut, I continue at the federal level to look for ways to reduce energy costs.”
In a news briefing earlier this week, Gov. Ned Lamont acknowledged the state’s high electric rates. “We’re at the end of the supply chain and we pay a premium for our energy,” he said.
But he pointed to a five-year-old deal to save Millstone as the main culprit for the recent hikes.
“I think it was a good move,” Lamont said. “It saved us a lot of money a couple years ago, it’s costing us money today because natural gas is very cheap and this is a differential we’re paying.”
The sharp increase in electricity bills can be attributed partly to usage, according to Eversource Spokesperson Jamie Ratliff, who said that Connecticut consumers typically use more electricity in the summer, especially this past summer since the state has experienced several heat waves.
Along with usage, she added, the public benefits fee – which funds energy-related programs targeting goals of helping the poor, subsidizing Millstone and reducing carbon emissions – as well as the supply portion of the bill, are the source of the cost hikes.
“Those two items are by far the most volatile components of the bill, because they are vulnerable to market forces,” Ratliff said. Eversource does not earn a profit from the public benefit fee nor does it control those costs, she said.
Ratliff also pointed out, “the July 1 increase to public benefits is the largest increase ever within that component”– a cost she said Eversourc had warned regulators about more than a year ago.
“So more than a year ago, we warned regulators that the rates they had set did not reflect the actual costs of those state mandated programs, and so by keeping those rates artificially low, they pushed forward those costs, and that’s what we are seeing,” Ratliff said.
PURA declined to comment while the Revenue Adjustment Mechanism proceedings are still pending, but the agency still has the power to adjust the latest rate hike.
Ratliff pointed out that the company is “highly regulated,” and that the high cost of energy in the region is due in part to the amount of natural gas in the region, leaving the state especially vulnerable to market forces.
“We are highly regulated,” Ratliff said. “Our rates are set by regulators, and we have a public benefits portion of the bill. Electricity costs, if you want to talk in general for the region, they are high, because about 50% of the energy that’s generated, it depends on natural gas in this region, and so natural gas is very much vulnerable to market forces. We’re at the end of the natural gas pipeline. We have constrained pipes.”
In an interview with CT Examiner, Rep. Jahana Hayes weighed in on what can be done at the federal level, referencing a program – dubbed the Low Income Home Energy Assistance Program (LIHEAP) – that helps low income households with home energy bills. In Connecticut, household annual income must be below 60% of the state’s median income to qualify.
Earlier this year, President Joe Biden signed into law a series of annual appropriations bills, including one that allocated more than $4 billion for LIHEAP for fiscal year 2024. For fiscal year 2023, appropriations for the program was more than $6 billion.
“We got $100 million [from the Infrastructure Investment and Jobs Act] in funding for the LIHEAP program, and when we saw that those funds would be depleted, we advocated for more funding,” Hayes said. “The money … from the Inflation Reduction Act to build out the grid and mitigate resiliency, are the things that I have oversight and can weigh in on.”
The Inflation Reduction Act, a federal bill in part passed to promote green technology and investments in health care, offered $9 billion in home energy rebates.
But an analysis from Politico’s E&E News found that funding could create a blue- and red-state energy efficiency divide, given that most states with Democratic governors applied for the money, while only three Republican-led states have done so.
As of June, New York was the only state with a program created through the rebate funds, according to E&E News.
Depending on who wins the November presidential election, the rebate provision, among other energy-related aspects of IRA, could be repealed or the funds could be used for programs supported by Donald Trump.
Sen. Chris Murphy echoed Hayes’ thoughts on the energy assistance program for low income households, saying that “in the short-term, that means making sure the LIHEAP program receives as much support from the federal government as possible and tax rebates are implemented quickly.”
“In the long-term,” he added, “I’m focused on achieving U.S. energy independence, fast-tracking clean energy deployment, and taking on Big Oil companies that collude to raise prices on consumers.”
Speaking with state residents last week, Rep. Joe Courtney said that many shared concerns about rising energy prices and urged Congress to continue pushing for the implementation of energy assistance programs.
“Just in the last week during senior center visits in eastern Connecticut, I heard loudly about rising state-set energy rates,” he said. “It is clear that efforts in Congress to lower consumers’ energy bills with energy efficiency tax credits and rebates for homeowners as well as increasing funding for LIHEAP, the low-income energy assistance program which seniors I spoke to rely on, need to be redoubled.”
