Residents, businesses, officials decry Eversource rate hike at Department of Public Utilities hearing
This story has been modified to correct the spelling of Penni Conner's last name.
PITTSFIELD — Disproportionate. Exorbitant. And greedy. Those were among the words used, again and again, by residents and business owners alike to characterize a proposed rate increase by Eversource. They asked the state to reject its request.
Eversource wants state Department of Public Utilities' approval to raise its rates by more than $96 million next year and $50 million annually for the next four years, according to the state's attorney general. If approved, the proposed increase would add $11.64 to the average monthly bill for residential customers who live in the west and $8.45 for those living in the east as of Jan. 1, 2018, according to Eversource.
For Eversource's commercial and industrial customers, the proposal would increase electricity rates up to 37 percent in Western Massachusetts. The rates for businesses in the east would decrease.
Eversource officials have said the proposed increase is needed to offset its operating deficit of nearly $96 million.
The DPU held a public hearing on the proposed increases in Pittsfield Monday night, one of several it is hosting statewide on the issue.
It was standing room only inside the Berkshire Athenaeum auditorium, where about 275 people filled it and an adjacent room.
Jane Winn of Pittsfield spoke of the diverse interests of those at the hearing. Head of the Berkshire Environmental Action Team, Winn pointed to fellow environmentalists, social justice advocates, business owners, state and local elected leaders and more.
Different though they are, she said they all agree on one thing: "We are all united against this rate hike, please take us into consideration," she said.
Many who spoke at the hearing said they were skeptical of the company's reasons for the proposed increase. They also said the increase is unfair to customers here, who on average earn less annually, versus the more affluent eastern part of the state.
"We are smaller, we are older, we are sicker and we are poorer," State Rep. William "Smitty" Pignatelli said. "Those are four facts that we cannot dispute about Berkshire County."
Electricity rates for commercial and industrial customers in Massachusetts are among highest in the country, behind Alaska, Connecticut and Hawaii.
The proposed increase would impact the bottom line of commercial customers from $41,000 to over $1 million, according to testimony given to the DPU Monday.
Pittsfield Mayor Linda M. Tyer said the city's bill would increase $1.3 million.
"This will undermine growth, threaten job security, and jeopardize the economic prosperity of every citizen," she said.
Brendan Ronayne, senior finance manager for crane currency, said it is in the middle of a five-year, fixed-rate contract with the United States government to make its currency paper. He said it anticipates paying $550,000 more to Eversource while the electric company would receive "excessive" returns.
Pat Begrowicz, owner of Onyx Specialty paper in Lee, stressed the disproportionate nature of Eversource's proposed increase.
She said the company would generate $2.2 million from the 18 largest ratepayers in Western Mass. Meanwhile, 112 similar companies in the east will see their rates decline.
"This exacerbates the divide between east and west," she said.
Attorney General Maura Healey continued her effort to block Eversource's request to hike its electricity rates by as much as 10 percent in Western Massachusetts next year. She told the DPU residential customers in Western Massachusetts are struggling to make ends meet, and businesses are working hard to remain competitive and grow.
"It is time to return money to customers, not to raise their electric bills to benefit a highly profitable utility company," Healy said.
Eversource says it is facing a $35.7 million operating deficit in the west and a $60.2 shortfall million in Eastern Massachusetts.
Penni Conner, Eversource senior vice president and chief customer officer, attributed the company's shortfall to capital investments the company made to maintain infrastructure and services to customers.
Of Eversource's 1.4 million Massachusetts customers, 209,000 live in the western part of the state and 1.2 million live in eastern Mass.
Although the operating deficit in Eastern Massachusetts is larger, the impact of the proposed rate increase would be greater in Western Massachusetts because the rate hike would be absorbed by fewer customers here.
But Conner said Eversource is reviewing the consolidation of its distribution rates to determine if that would lessen the impact on customers in the western part of the state,
Conner also pointed out that customers here have received millions of dollars in the past five years in credits because of revenue decoupling.
If the company was not mandated to give those customer credits Eversource would have used that money "to avoid rate cases like this one," she said.
She said in recent years the company has also improved its service to customers in a number of ways, including tree trimming. She said fallen tree limbs are the leading cause of power outages. She said power outages in Western Mass. dropped 43 percent and are 23 percent shorter than before the merger of Western Massachusetts Electric Company and NSTAR into Eversource.
The DPU began holding hearings on the proposed increase last month and several others more scheduled this month. It will hold evidentiary hearings at the DPU in Boston in June.
Reach staff writer Carrie Saldo at 413-496-6221 or @carriesaldo
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