Eversource seeks 11% rate hike for Connecticut residents by next summer

HARTFORD, Conn. (WTNH) — Eversource customers in Connecticut may see a double-digit rate hike next summer.

The electric company filed a letter of intent on Wednesday seeking a rate hike of about 11% across all customer classes and about 13% for residential customers. If the distribution rate is approved as proposed, it would begin on July 1, 2027.

A spokesperson for Eversource said the letter of intent details an annual operating revenue deficiency of about $503 million, not including storm costs between 2018 and 2023.

The economy, inflation, supply chain challenges and other factors increased equipment costs and materials across the utility industry, according to Eversource.

To maintain the level of “affordable reliability and resiliency” customers expect, an increased investment is needed, an Eversource spokesperson said.

Read the full letter of intent below:

The letter of intent is the first step in requesting that regulators review and adjust distribution rates to reflect the modern cost of maintaining electric systems and services.

Eversource Spokesperson Sarah Paduano’s full statement on Wednesday read:

“Today we submitted a letter of intent (LOI) to file a distribution rate review for our electric operations – the first in nearly a decade. Over the last 10 years, customers have experienced increased reliability as a direct result of our strategic investments in the electric system, and increased investment is needed to maintain the level of affordable reliability and resiliency that customers have come to expect. 

The LOI is standard procedure and submitted prior to filing the actual rate review application. This is the first step in the process to request regulators review and adjust current distribution rates to better reflect the cost of maintaining the electric system and safely delivering power to customers across Connecticut. Our LOI details an operating revenue deficiency of approximately $503 million annually, which excludes 2018-2023 storm costs. If approved as proposed, the average increase would be approximately 11% across all customer classes and approximately 13% for residential customers starting July 1, 2027.

Our storm costs are currently being evaluated by PURA in a separate docket, and we are hopeful regulators will authorize securitization for those costs, which is a specialized financing method that will allow those costs to be recovered over a much longer timeframe of 20 years and at a lower interest rate compared to the traditional six year recovery. If securitization is approved, this will substantially lower bill impacts for customers and allow us to keep the full amount of storm costs from our rate review application.“

Connecticut Attorney General William Tong released the following statement Wednesday in response to the proposed rate increase:

“Connecticut families are getting crushed by unaffordable energy costs while Eversource executives crow to Wall Street over surging profits and rake in multimillion dollar bonuses. But they choose now to demand hundreds of millions of dollars more. Why? Because after years of litigation and lobbying, they finally ran their chief regulator out of town. They want a rate hike now not because they need one, but because they think they can get away with it. We’re going to scrutinize every profit, every bonus, every perk and every padded expense in their application and we’re going to be fighting for Connecticut families and small businesses at every step of this process.”

Paduano said there are no CEO, CFO, or company president salaries or variable pay included in the proposed rate request.

Consumer Counsel Claire E. Coleman also released the following statement on Wednesday on the rate filing:

“A letter of intent is the first step in the rate case process, where a company notifies regulators that it intends to seek a rate increase. Eversource will now have up to 60 days to file a full application, formally triggering what is expected to be one of the most consequential utility review proceedings in years. Once filed, OCC will aggressively scrutinize the company’s request, conduct discovery, cross examine Eversource witnesses, and present recommendations to PURA to ensure customers are not asked to pay for anything beyond the most necessary and cost-effective investments. My office will prioritize keeping  costs as low as possible for consumers already struggling with affordability challenges, while promoting critical infrastructure, cybersecurity, consumer protections, and overall system reliability. Because Eversource has not undergone a rate review since 2018, this case will provide the first real opportunity in years to thoroughly examine the company’s operations, spending decisions, and priorities under a microscope. This process will also provide multiple opportunities for members of the public, community organizations, and elected officials to participate through public hearings and written comments submitted into the record. OCC strongly encourages consumers to stay engaged throughout the proceeding and to visit our website or contact our office directly for information on how to participate.”