BOSTON (Legal Newsline) -- Massachusetts Attorney General Martha Coakley said Wednesday a federal judge has ruled that electric transmission companies should lower their rates by an estimated $115 million.
The ruling by Administrative Law Judge Michael Cianci Jr. comes a year after agreeing that the amount companies charge consumers for infrastructure investments is too high.
The decision, which must be approved by the Federal Energy Regulatory Commission, would reduce the return on equity from 11.14 percent to 9.7 percent.
The decision is the result of a landmark lawsuit filed with the FERC by Coakley's Energy and Telecommunications Division.
"This groundbreaking decision is a significant step toward bringing millions of dollars in relief to New England ratepayers who have been overcharged for years," the attorney general said in a statement.
"Our office has long argued that current electric transmission rates are excessive and place too high a burden on businesses and families. This decision is a major victory for consumers across Massachusetts and New England."
Transmission companies are permitted to recover the costs to construct transmission lines plus a profit of 11.14 percent. The current allowed profit, which was set by FERC in 2006, costs New England ratepayers $1.755 billion annually.
With worsening economic conditions, Coakley's office alleged transmission companies were charging much more than required for other comparable companies in a 2011 complaint with FERC.
The respondents in the lawsuit were Bangor Hydro-Electric Company; New England Power Company, doing business as National Grid; Central Maine Power Company; New Hampshire Transmission LLC, doing business as NextEra; Northeast Utilities Service Company; NSTAR Electric Company; The United Illuminating Company; Unitil Energy Systems Inc.; Fitchburg Gas and Electric Light Company; and Vermont Transco LLC.
Joining the complaint were Connecticut Attorney General George Jepsen, the Connecticut Office of Consumer Counsel, the Connecticut Public Utilities Regulatory Authority, the Massachusetts Municipal Wholesale Electric Company, the Massachusetts Department of Public Utilities and several New England state regulators, industrial consumer groups and ratepayer advocates.
If the decision is approved, overall savings for ratepayers in New England would grow to approximately $145 million annually by 2017, Coakley's office said.