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Tuesday, October 15, 2019

Transmission company says industry's perspective, efforts being 'overlooked' in rate case

By Jessica M. Karmasek | Aug 9, 2013

BOSTON (Legal Newsline) -- One of the transmission companies at the center of a lawsuit filed by Massachusetts Attorney General Martha Coakley for allegedly overcharging consumers claims the industry's perspective and its efforts have been "overlooked."

On Wednesday, Coakley's office announced that Administrative Law Judge Michael Cianci Jr. ruled that a group of electric transmission companies, including Northeast Utilities Service Company, should lower their rates by an estimated $115 million.

Cianci's ruling comes a year after he agreed that the amount the companies charge consumers for infrastructure investments is too high.

But Northeast Utilities counters that it has made "significant investments" in the region's transmission system on behalf of its customers.

"New transmission projects are critical when it comes to improving access to renewable energy sources both locally and regionally," Frank Poirot, a senior media specialist for Northeast Utilities, wrote in an email.

"Our transmission investments have also saved customers over $1 billion in their bills by providing access to lower cost generation supplies, while returning millions of dollars in taxes to host communities.

"We continue to believe that our ROE (return on equity) is reasonable and encourages investment in the region's transmission infrastructure."

Cianci's 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 judge's ruling is the result of a lawsuit filed with the FERC by Coakley's Energy and Telecommunications Division in 2011.

"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 this week.

"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 the FERC in 2006, costs New England ratepayers $1.755 billion annually.

Coakley's office, citing worsening economic conditions, alleged transmission companies were charging much more than required for other comparable companies.

The other 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; 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.

According to Coakley's office, if the decision is approved, overall savings for ratepayers in New England would grow to about $145 million annually by 2017.

"We are hopeful that FERC in its final decision will consider the importance of encouraging investment in transmission infrastructure, especially as the nation strives for more extensive use of renewable energy, and needs transmission to move wind and solar generation from remote areas to where the energy is needed most," Poirot said.

From Legal Newsline: Reach Jessica Karmasek by email at

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