AG Tong Moves to Intervene in PURA Investigation, Urges PURA to Consider Potential Fines for Failed Storm Response(Hartford, CT) – Attorney General William Tong today formally requested to intervene in the Public Utilities Regulatory Authority's open investigation of the Eversource and United Illuminating response to Tropical Storm Isaias. The Attorney General is urging PURA to put the company on notice of potential fines and penalties.
“We pay far too much for our energy in Connecticut to be left in the dark. Consumers have poured millions of our ratepayer dollars into resiliency investments to harden our system and prepare for this precise type of storm. Eversource and United Illuminating appear to have been unacceptably unprepared for Isaias and must be held accountable. The Office of the Attorney General will be fully engaged in this investigation on behalf of ratepayers who are entitled to answers and any appropriate relief. PURA is right to open this investigation, and must be prepared to issue real fines and penalties to hold the utilities accountable for their failure,” said Attorney General Tong. “Consumers have a right to be angry here—as am I. At the same time, I am deeply grateful to the line crews and first responders who have worked tirelessly to restore power across our state. Their efforts should be commended and they deserve our full support.”
The PURA investigation should examine carefully a variety of issues, including:
1. The prudency of the companies’ preparedness and response.
Eversource filed its notice of pre-staging in preparation for the upcoming storm on July 31. In that notice, the company declared the “event” a level 4 to begin on August 3. Eversource did not upgrade this classification to a level 3 until August 5 – 12 hours after the storm had hit. It then further upgraded the storm to level 2 on August 6. United Illuminating, in contrast, waited to file its notice of prestaging until August 3, the day before the storm hit, and declared it a level 3 event.
These notices raise questions that must be considered in this case. How did these classifications impact the companies’ preparations and public messaging? With regard to Eversource, even if its classification of this storm as a level 4 was appropriate on July 31, should that have been upgraded as the storm got closer? And, why did UI wait so long to declare this an event and was there adequate time to pre-stage at that point?
Also, PURA must investigate whether, aside from these classifications, the companies’ preparations were prudent. Did they have enough crews and equipment available? Were their actions after the storm him reasonable? Did they provide the public adequate and timely information to inform customers and towns of what they need to do in order to be prepared? And, what about all of the money customers invested in “hardening” their systems since 2011?
2. The companies’ customer information systems.
After the major 2011/2012 storms, Eversource dramatically upgraded its customer information process and procedures to improve two-way communications. This was intended to make their system for taking calls about outages more efficient and effective and to make sure that they could get information out to individual customers more effectively. This system simply failed to work as intended during this storm. Many customers could not get through to report outages and did not receive any updates or information from the company. Why is that? Why was Eversource’s system down and not available to many of its customers when it was needed? PURA previously identified issues with this system three years ago and raised them with the company. This failure must be addressed.
3. PURA must consider whether penalties are appropriate.
PURA must make clear at the outset of this investigation that it will consider the prudency of the companies’ preparation and response and that it may impose appropriate penalties if warranted. A prudency review essentially examines whether the utility met the industry standard of care and whether there is any causal connection between imprudent conduct and actual loss or damage. Such a prudence review could lead to fines and penalties if noticed at the outset of the proceeding. Penalties could include disallowing storm cost recovery and, in a future rate case, reducing the utility’s authorized return on equity (“ROE”).