Free the power grid

We need electricity to be regulated. We do not need electricity millionaires or electricity stockholders living off their dividends

The front page article on electrical rates in the March 28 New Haven Register was titled “High price to pay?” Truly, no question mark was necessary. An exclamation point would have been more accurate. Only Alaska and Hawaii pay more for electricity. Connecticut residents pay the most in the continental United States, and have endured this distinction for about the past 15 years.

Rather than regulate rates to benefit the public, the Public Utilities Regulatory Authority (PURA) and our politicians allow Avangrid (owner of United Illuminating), Eversource and Dominion Energy (owner of Millstone Nuclear Power Station) the leeway to set the terms to benefit their corporate profits.

Even the procurement of electricity lacks transparency. ISONew England oversees the grid, and buys electricity for the region in the nebulous wholesale electricity markets.

PURA Chairman Marissa Gillett, in addressing the Energy and Technology Committee of the Connecticut General Assembly, tellingly remarked, “It became very clear to me, after arriving, that there is a complicated rate-making structure in Connecticut that is much different from the one that I was used to in the Maryland context…I’m not sure that it’s different in a positive way.” (New Haven Register, Aug. 29.)

We hope by now, Chairman Gillett has realized it’s not a positive difference.

Regarding costs for storm recovery, it is the ratepayers who foot the bill. The corporations don’t cover the cost out of their profits. In the past decade, Avangrid and Eversource recouped from ratepayers over $544 million — and that doesn’t include the estimated $230 million in damages from last August’s Tropical Storm Isaias. (New Haven Register, March 29.)

In 2020, Eversource made $1.2 billion profit and Avangrid made $581 million in profit. This is a lot of money.

The CT Examiner of Feb. 21, explains how Eversource got it. “In its annual report to shareholders and regulators issued Wednesday, Eversource boasted a profit of $1.2 billion across its subsidiaries, an increase of $304.3 million — or 34 percent over 2019. The company attributed the gains mainly to electric rate increases, recovering the costs of capital investments through rates, and earnings from its growing natural gas distribution business in Massachusetts ... Connecticut profits grew $47 million, or 11.4 percent, over 2019 — totaling $457.9 million in 2020. That accounted for 64 percent of Eversource’s overall profit growth, as its other two companies posted more modest gains.”

The Journal Inquirer reported on Aug. 8, 2020 that the five highest paid executives of Eversource earned a total of $40 million in 2019. Jim Nolan, the newly appointed CEO of Eversource, in his previous 2019 position, received a total compensation of $5.7 million (salary, bonus, stock and non-qualified deferred earnings). As CEO, he’ll be making a lot more.

His predecessor, Jim Judge, made $11 million in 2019, but with total compensation he earned $19.8 million. Curiously, only the $11 million figure was in the printed New Haven Register article of April 9. The on-line version of the article posted on April 8 listed the full $19.8 million figure, and also included fifteen additional paragraphs to the article.

2020 was not that good a year for Jim Judge. “The company’s highest paid executive, Eversource CEO James Judge, saw a salary increase of $52,383 to bring his base pay to $1.37 million. His pension earnings were down about $5 million from what he earned last year, and his total compensation is down $5.2 million — 26 percent — to $14.5 million as a result.” (CT Examiner of Feb. 21, 2021)

This makes former CEO of Avangrid James Torgerson seem like a bargain, whose 2019 salary, bonus and compensation totaled $2,258,449. Though he did better in 2018, with total compensation at $5,709,436. (available at https://www1.salary.com/)

It seems Avangrid’s current CEO, Dennis Arriola, will be making a comparable amount. An internet search found “According to a Form 8-K filed June 11 with the Securities and Exchange Commission, Arriola’s base salary at Avangrid will be $1.1 million per year. He will receive payments of $1 million in January of 2021, 2022 and 2023, shares of Avangrid stock and is eligible for incentives of up to twice his base pay.”

Wouldn’t you say the profit margins and executive salaries are a tad extravagant? How can this happen that a utility company with the purpose of providing a public benefit, raises rates and creates new charges on the bills for ratepayers to cover repairs, maintenance, storm damage, etc., while shareholders get their dividends and the executives are millionaires many times over?

The Sept. 6, New Haven Register gives us an answer. Since 2014, Avangrid and Eversource spent $9 million lobbying the state’s legislators.

The memory of the difficulties of living through Tropical Storm Isaias and its aftermath are ingrained in the minds of thousands of Connecticut residents who were without electricity for a week.

Threats of having one’s electricity cut off when the moratorium ends cut to the core of people struggling without their jobs due to the economic devastation of the COVID pandemic.

The corporations are beholden to their stockholders. Millions of dollars flow to their executives, their lobbyists act as advisors to our legislators, and when faced with unprepared expenses from a storm, the ratepayers get hit with more charges.

In 2006, a group of New Haven area citizens banded together to protest United Illuminating’s 50 percent rate increase. That was the beginning of Fight the Hike, which soon spread to many parts of Connecticut. It demanded of the legislature, United Illuminating and Connecticut Light and Power (CL&P, now known as Eversource) lower rates, renewable energy, transparency and corporate responsibility towards ratepayers. Fight the Hike brought Connecticut ratepayers (not lobbyists) to Hartford to give public testimony at Energy and Technology Committee hearings, and to speak to state senators and representatives about being held hostage by out-of-control electric prices. After many years of activism, a comprehensive energy plan began to be developed that showed some promise. Since then, there has been a cycle of faltering, moving ahead, and stalling.

We need electricity to be regulated. We do not need electricity millionaires or electricity stockholders living off their dividends

Must the poor, the working class, the everyday people, and the cash-strapped social welfare agencies of the cities that care for the indigent continue to subsidize the rich?

Either regulate the utilities or get the grid out of private control.