PURA rips Eversource, UI for Isaias response; Utilities face loss of millions of dollars’ worth of profit
Tropical Storm Isaias may be long gone, but it has hardly been forgotten by Connecticut’s Public Utilities Regulatory Authority.
The agency has issued a scathing report on how utilities Eversource and United Illuminating responded. As a result, both companies potentially face the loss of millions of dollars”™ worth of profit.
PURA”™s final decision said that the utilities failed to meet “certain acceptable performance standards in preparing for, and responding to, the storm,” which left hundreds of thousands without power last August.
PURA has ordered a reduction in the profits of both Eversource and UI. Eversource, headquartered in Boston, will receive a downward adjustment of 0.9% while UI, based in New Haven, will receive a reduction of 0.15%. The move is intended to incentivize the companies to better prepare for future storms, PURA said.
Both utilities will also undergo a management audit and be ordered to improve their emergency response plans.
It is also likely that the utilities will be assessed fines as early as next week.
According to the report, both companies were unnecessarily underprepared for the severity of Isaias, were slow to respond, and failed to properly communicate with affected customers and municipalities.
In a press release, PURA said that “Eversource exhibited multiple deficiencies, failing to satisfy established performance standards for managing its municipal liaison program, executing its Make Safe responsibilities, communicating critical information to its customers, and failing to meet its obligation to secure adequate resources in a timely manner to protect the public safety and to provide for the overall public interest.
“The myriad failures were particularly poignant in the first 48 hours following the tropical storm when their inactions or deficiencies created a significant risk to public safety,” it added.
UI”™s performance “was underwhelming in certain areas, but was still markedly better than that of Eversource,” the agency continued. “While UI secured and deployed adequate line crews for the event, in communities such as Bridgeport, the company failed to meet all of its Make Safe obligations. The investigation also found that UI failed to meet its public safety obligations in responding to the highest priority calls.”
“I am not satisfied by the status quo of the utilities treating PURA simply as a body that they report information to,” PURA Chairman Marissa P. Gillett said. “We are their regulator, and continuing to hold them to account will remain my mission for the duration of my service in this position.”
In response, Eversource issued a statement. “We stand by our response in Storm Isaias as we know our thousands of employees showed skill and dedication in restoring power to customers as quickly as possible. There are many areas for improvement that we are already addressing and we continue to work in good faith with our communities, customers and regulators to improve our performance. Today”™s decision deserves careful consideration and review and we are committed to moving forward in the best interest of our customers.”
UI also issued a statement, saying it is “still reviewing (the decision) in detail. However, we are disappointed that the ruling does not fully reflect the facts we presented during the proceeding, and that it imposes a penalty despite PURA”™s finding that UI ‘generally met the standards of acceptable performance and conducted itself prudently and efficiently.’
“We are mindful of the deficiencies cited by PURA, and are well aware of the difficulties that extended outages cause for our customers,” it continued. “However, we believe the facts clearly support that UI faithfully followed its Emergency Response Plan, and met the overall targets therein.
“As we consider our next steps, we will continue to use what we learned during Isaias, and from PURA”™s investigation, to serve our valued customers, and to improve our readiness for and response to future extreme weather events,” UI concluded.
“Eversource and UI were not adequately prepared to serve their ratepayers to keep the lights and air conditioning on during a significant storm,” Gov. Ned Lamont said. “Accountability is critical for all ratepayers across our state and that is what is happening now.”
“Eversource failed and must regain our trust,” Attorney General William Tong said. “Their failed response to Isaias put lives in danger, and left families in the dark and disconnected during a deadly pandemic.
“PURA”™s strong decision correctly concludes that Eversource was ill prepared and poorly managed throughout the storm crisis,” he continued. “PURA has rightly opened the door to strong penalties and corrective action, and we will continue to advocate for full accountability at every step of this process.”