Remake Eversource? ‘It’s not easy.’
No one is going to complain about not losing power for a week. We did that last year. It was no fun.
Still, what we lost when Tropical Storm Henri fizzled out (for Connecticut, at least) was a serious discussion about our system’s shortcomings. Last year, when much of the state was in the dark for a week after Tropical Storm Isaias, people in positions of authority for the first time in years started publicly asking questions about why our method of power delivery looks the way it does.
The danger was always that once the lights came back on, everyone’s attention would move on to more immediate crises, and our utility situation would fade — at least until the next mass power failure. That’s exactly what happened. The arrival of Henri, with forecasts of hundreds of thousands of outages for weeks on end, promised a fresh look at those questions.
Instead, the storm veered away and we were able to again put off any hard questions.
This resulted in a victory lap of sorts by officials who claimed that reforms instituted after Isaias had proven successful, and that we were in much better shape now than we were then. This happened despite the fact that the storm this year did little harm in Connecticut, and the fundamental questions about our utilities remain.
Those questions were best summed up last year by Bridgeport state Rep. Steve Stafstrom, who asked on Twitter as the lights were still out, “Can someone explain to me why a ‘public utility’ that operates as a monopoly can be traded on an exchange and has a fiduciary responsibility to maximize shareholder profit?”
A year later, Stafstrom said recently he doesn’t have a good answer to that question, though he did call the bipartisan Take Back Our Grid Act, which introduced performance-based measures for utilities, a “step in the right direction.”
When it comes to bringing electricity to your home, Eversource (and, for a smaller part of the state, United Illuminating) can’t be outcompeted. It’s not like some startup can go around stringing up power lines. Delivery of electricity is properly understood as a public good, something that falls under a different category than, say, buying a dishwasher.
Eversource, though, operates like a typical company in many ways, albeit a highly regulated one. It has shareholders and well-paid executives and looks to cut costs to maximize profit. It’s about as strange an amalgamation of public and private as you’re likely to come up with, and it’s the result of years of deregulatory tendencies that stretched well beyond Connecticut.
The thinking was that the private market knows best, but we still want our public services on time and uninterrupted. So we ended up with this hybrid system.
Sen. Chris Murphy was another public official who looked at the disaster of Isaias last year, following three mass power failures in 2011-12, and decided there had to be a better way. “I am spending the rest of summer getting deep in the weeds learning the benefits of publicly owned utilities,” he said in 2020. “We need to seriously consider this as an option moving forward.”
Post-Henri, he said the question was still on his mind. “I spent a month or so after that looking into pathways by which you would convert a massive, for-profit utility into a public utility,” he said in an interview Tuesday. “Suffice it to say it’s not easy.”
Among the many obstacles would be paying the existing utilities to go away. “It’s a herculean endeavor that would involve a scheme of compensation for the private company that would require a pretty big appropriation of dollars for the private utility,” Murphy said. The fact that Eversource covers many states, not just Connecticut, makes the issue even tougher.
In the meantime, actions like those taken by the legislature are going to have to do.
Gov. Ned Lamont said in advance of Henri that he wanted Eversource not to “overpromise and under deliver — do the opposite.” The result was the utility forecasting hundreds of thousands of power failures for up to three weeks. It set up a potential Isaias-level response, with only a week in the dark, to look heroic by comparison.
What everyone needs to understand is the issue is not going away. Bigger storms are coming, and they’ll be arriving more frequently. Every model of climate change predicts that, and we’ve seen it happening already. No one should be surprised to see an Isaiaslevel event on a yearly basis, if not more often. The question is what we’re going to do about it.
The answer is likely to be to pick around the edges. Our public-private hybrid model is not going away in the near-term.
But neither should the utilities expect reforms to be finished. They can complain — and they have — but efforts to force better preparation and response will only intensify. As Murphy said, “The future is more regulation, not less.”