Coakley blames power company for layoffs, not former AG

John O'Brien May 21, 2008, 3:32pm


BOSTON (Legal Newsline) - In response to criticism of her predecessor, Massachusetts Attorney General Martha Coakley on Wednesday showed her disapproval of Western Massachusetts Electric Co.'s actions last year.

WMECo had blamed its Jan. 2007 rate increases on a settlement it reached with former Attorney General Tom Reilly. Those rate increases led to three companies each closing a paper mill and laying off 400 total workers.

Coakley said the company simply did not warn its customers that their power bills were about to go up.

"Although the rate increases that customers in western Massachusetts received at the beginning of 2007 were lawful, we are concerned that WMECo did not take steps to notify its customer base that the rate hike was going into effect," Coakley said.

"Electricity customers need to be reasonably forewarned about rate hikes to allow adequate time for customers to budget for the increase to their monthly expenses."

Coakley added that WMECo complied with all notice requirements but did not go the extra mile.

"Despite the fact that the company met all of its statutory notice requirements, the company failed to communicate to customers that a number of significant increases were to occur simultaneously on Jan. 1, 2007," the report says.

"The company made no effort to explain the rate increases until late March 2007 -- nearly three months after the rate increases went into effect. At first, the company provided a misleading explanation for the increase, but later provided a more thorough explanation."

Coakley's major findings in the report say that WMECo's financial situation after the settlement was within the scope of what it agreed to in it.

Reilly and WMECo entered into the agreement in Oct. 2006.

"With customers struggling to keep pace with increasing electricity bills in Western Massachusetts, we intend to continue to monitor whether WMECo is undertaking the needed transmission upgrades, which is part of the solution to mitigating the rising cost of electricity in Western Massachusetts," Coakley said.

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