With state revenues higher than expected in the early months of 2011, legislators have discussed removing a surcharge on Connecticut Light & Power bills, according to executives of parent company Northeast Utilities.
Connecticut Light & Power is the dominant utility in Fairfield County, as well as Yankee Gas.
Hartford-based Northeast Utilities is opposed to a continuation of the surcharge, which was put in place a decade ago to help defray the cost of corporate bonds that have since been repaid.
“There”™s still a lot of discussion going on in that within the Legislature,” said Chuck Shivery, CEO of Northeast Utilities, in an early May conference call with investment analysts. “Right now, our revenues (and) the state”™s revenues are coming in a little higher than they anticipated, so there is continuing discussion on that issue.”
Northeast Utilities earned $114 million in the first quarter, up from $86 million a year ago, attributing the high profits to a mix of cost controls, the impact of electric rate distribution decisions received in the past year and weather.
UIL Holdings Corp., whose United Illuminating subsidiary furnishes power in the Bridgeport area, earned $52 million, more than triple its take a year earlier thanks to a $37.4 million contribution during the quarter from a trio of natural gas suppliers it acquired last year. Earnings from electricity transmission were $7.7 million, up $1 million from the first quarter of 2010.
In a measure of relief for businesses, the region has ample electricity generation and transmission resources to minimize any chance of power outages during heat waves this summer, according to both ISO New England, the Holyoke, Mass.-based overseer of the region”™s electricity markets, and the Northeast Power Coordinating Council, which is based in New York City.
“We”™ve seen some strength ”“ and I use that term loosely ”“ in the industrial area, up 1.5 percent on average across all of our classes,” said David McHale, CFO of Northeast Utilities. “We see a little bit of growth in the residential area, and still some weakness of course (in) commercial across all of our businesses.”
Northeast Utilities took an $8 million charge in the first quarter as it works to complete its merger with Massachusetts-based NStar.
Both companies are pushing ahead with the Northern Star project to run power lines south from New Hampshire to tap into hydro power in Quebec, with some residents and groups opposing the construction of the towers that would stand at least 80 feet tall. In March, New Hampshire legislators introduced a bill that would make it illegal for the state to appropriate by eminent domain land needed for such projects. Northeast Utilities and NStar still hope to complete the project by 2015, and vowed to work with New Hampshire communities even as the companies lobby against the bill.
“We are comfortable that we”™re still going to be able to do what is necessary to get this line sited and eventually built,” Shivery said. “We really don”™t believe this is a good bill and so obviously we are in the process of arguing that point. But we are also looking at a variety of other options to allow us to move forward with the line.”
