Saving energy might cost more

Blumenthal to fight any UI increase

By Brian McCready
Milford Bureau Chief
MILFORD — Attorney General Richard Blumenthal said late Wednesday he will vehemently oppose any talk of a rate increase by United Illuminating Co., an increase he calls “unnecessary and undeserving.”
The issue of a possible rate increase by UI was raised at a press conference Wednesday afternoon at City Hall, where state Sen. Gayle Slossberg, D-Milford, stood with Republican Mayor James L. Richetelli Jr. and local business officials to rail against the state Department of Public Utility Control.
The DPUC Wednesday issued a draft decision that allows UI to open its 2006 rate case, a move Slossberg and Blumenthal conceded could lead to another rate increase. In 2006, rate payers were hit with a double-digit increase; UI still has 1½ years remaining on its current contract.
But UI argued its case be opened because the company is not earning the return allowed for, and the utility has been hit by lower sales. Slossberg said the company also said it’s been hurt by people conserving energy.
The DPUC has not agreed to a rate increase, nor has UI said it is specifically seeking a rate increase.
UI spokeswoman Anita Steeves balked at whether a rate increase is needed, saying “like any other company we need to recover our costs.”
“Any company is allowed to earn a return on their capital, we however have a statutorily regulated limit,” Steeves said.
A DPUC official could not be immediately reached for comment. No timetable for a decision has been given.
“We’re aware of the draft decision and we intend to fight it,” said Blumenthal adding that on May 16 he wrote a letter urging the DPUC not to allow UI to open its 2006 rate case. “Unfortunately the DPUC has granted that request. This decision is badly misguided and mistaken because it will probably hit the consumer at the most vulnerable economic times.”
Steeves said conditions upon which the four-year DPUC decision was finalized in 2005 are no longer being met. The decision was based on the assumption there would be a 1 percent increase in electricity use each year.
Steeves said electricity use has decreased by 0.6 percent this year. She added the cost of keeping up UI infrastructure has outpaced estimates because of the rising costs of raw materials.
“We want to facilitate a discussion to see if there are ways to recover our costs in a way that mitigates the cost to our customers,” Steeves said.
Blumenthal said his record in fighting rate hikes with the DPUC has its “ups and downs.” But because of the porous economic times “there is still hope” the DPUC will deny any proposed rate hike.
Blumenthal said he plans to demonstrate that any rate increase is “not necessary.”
“They don’t need it and don’t deserve it,” Blumenthal said.
Slossberg blasted UI officials, saying because corporate shareholders aren’t getting as much profit as they want consumers will be forced to bear the pain.
This will hurt families, businesses, and local governments trying to make ends meet,” Slossberg said. “This will punish consumers who have worked so hard to lower their energy consumption because that’s what their utility encouraged them to do,” she said.
Richetelli said the city just adopted its budget for next year and any rate increase would hurt.
“We as a municipality cannot afford higher taxes on our residents and businesses cannot afford higher rate bills,” Richetelli said. “This will put people over the edge.” We just cannot afford it.”
Orange Research owner Paul Hoffman of Milford, whose manufacturing business employs 35 people, said his utility rate bill spiked 32 percent after the most recent rate increase. He said the company tries to reduce costs and be more efficient but it’s impossible to grow new jobs.
Milford Chamber of Commerce President Kathy Alagno said UI representatives will meet with board members June 16 to provide their reasons for opening the 2006 rate case.
Slossberg urged all UI consumers to contact DPUC and write letters voicing their opinion about another rate increase.
UI serves 17 communities and has 320,000 rate payers from Hamden to Fairfield.
Register reporter James Tinley contributed to this story.