Blumenthal gets involved in merger
HARTFORD, Conn. (Legal Newsline) - Connecticut Attorney General Richard Blumenthal announced on Wednesday that he believes utility customers in the state should be shielded from rate increases if a takeover of two companies goes through.
Connecticut Natural Gas and Southern Connecticut Gas may be taken over by United Illuminating Company's parent company, UIL Holdings Corporation. Blumenthal also believes that the takeover should be rejected unless ratepayers are also allowed to share in any benefits resulting from the purchase, since the proposed transaction includes tax provisions that he says could cost ratepayers as much as $21 million a year in higher rates.
Currently, the Department of Public Utility Control is reviewing an application by UIL and Iberdrola USA Inc. for UIL to acquire ownership of CNG and SCG.
Blumenthal said he believes that the companies have not proven to the DPUC that the acquisition of the two gas companies is in the public's best interest, which is required by law, and urged the DPUC to reject the transaction.
Blumenthal wants assurances that ratepayers are protected from future rate increases and benefit from this merger.
"We are seeking an iron-clad promise of protection that ratepayers will be better off-not burdened-by this merger," Blumenthal said. "UIL should be required to shield ratepayers from rate increases, share benefits and provide improved service as a result of its takeover of the gas companies. The companies have so far failed to offer any real benefits to consumers, such as cost savings or improved service."
Under state law, no company may take control over a regulated public service company without DPUC approval. The DPUC must investigate and hold a public hearing on any applications to find out if the transaction would be in the public's best interest.
Blumenthal is running for U.S. Senate.