LEGAL NEWSLINE

HARTFORD, Conn. (Legal Newsline) -- Connecticut Attorney General George Jepsen filed a brief Friday asking the state Public Utilities Regulatory Authority to disallow at least $90 million in storm-related recovery costs requested by the Connecticut Light & Power Co.

Jepsen argued that certain claimed costs are unjustified or improper and that PURA should put a substantial penalty in place for CL&P's allegedly inadequate and deficient response to the October 2011 nor'easter and Tropical Storm Irene.

CL&P is seeking to charge $414 million to ratepayers for costs the company claims are associated with major storm damage in 2011 and 2012.

In the brief, Jepsen argued that PURA should disallow 30 to 50 percent of the incurred costs from the two storms due to CL&P's failures during the storms.

"Utility companies are, by law, allowed to recover reasonable expenses for major storm response," the attorney general said. "However, I believe CL&P's petition to PURA includes a number of expenses that should not be recovered from ratepayers. Further, I believe the evidence presented in these proceedings shows that, in a number of instances, CL&P did not take adequate steps to protect its ratepayers.

"CL&P should treat its ratepayers as a last, rather than a first, resort for its storm-related costs."

A 30 to 50 percent disallowance of the $111.2 million in costs CL&P associated with Tropical Storm Irene and $175.1 million related to the nor'easter would equal a disallowance of $85 million to $140 million.

Jepsen also alleged that CL&P incorrectly accounted for $16.34 million in accumulated deferred income taxes that should have been provided to ratepayers, failed to hold AT&T responsible for its rightful share of storm-related tree work, mismanaged an affiliate storm reserve fund and failed to evaluate whether damage sustained during the two storms could have been covered by an insurance policy.

He also said the company is precluded from seeking recovery for two thunderstorms in June 2011 because of a prior merger settlement agreement.

PURA is expected to issue its draft decision on this matter by late December.