Connecticut Agencies Challenge Utility Surcharge on Ratepayers
Connecticut state agencies filed a federal complaint seeking to eliminate a bonus profit charge Eversource and United Illuminating collect from ratepayers for mandatory grid participation
A 2025 state law made utility participation in the regional grid operator mandatory, eliminating the rationale for the incentive payment utilities have collected since joining
If the complaint succeeds, Connecticut ratepayers would save $4.5 million annually; if other New England states follow, regional savings could exceed $14 million per year
A number of Connecticut agencies have filed a complaint with the Federal Energy Regulatory Commission, seeking to nullify charges imposed by Eversource Energy and United Illuminating because they are violating state law in seeking to profit from state ratepayers.
The Department of Energy and Environmental Protection, Office of Consumer Counsel, Public Utilities Regulatory Authority and Attorney General filed the complaint with the FERC, the federal agency regulating transmission rates.
Historically, FERC allowed companies owning electric transmission, including Eversource and UI, to collect a bonus charge from state ratepayers because they voluntarily participated in ISO New England, which operates the New England transmission grid.
However, a 2025 law ended ratepayer subsidies to utilities in this manner because their participation in ISO-NE is now mandatory. The complaint filed would finalize that move as there is no longer any rationale for rewarding voluntary ownership. Connecticut is the third state and the first New England state to make the change.
The transaction in question allows transmission-owning utilities to collect a 0.5% additional profit margin as “incentive” for joining a regional RTO. Connecticut ratepayers have paid it since.
Should the complaint succeed, Connecticut ratepayers would save $4.5 million annually on their electric bills; if New England states follow suit on the policy, ratepayers could save more than $14 million per year, according to Gov. Ned Lamont’s office.
“Utilities with record profits should not receive bonus profits for doing something they are required to do by law,” Lamont said. “This is another way we’re addressing the issue of high electric bills in our state and ensuring utilities are not able to take advantage of ratepayers.”
“Ratepayers are footing the bill for a $4.5 million annual bonus to utilities for doing what they are already required to do by law,” said Attorney General William Tong. “Connecticut families are paying way too much for their energy bills, and we cannot afford to bankroll multi-million dollar brainless bonuses.”
By Joe O’Leary