Eversource to cut rate increase in Western Massachusetts
AG says late tweak in rate mechanism complicates review
PITTSFIELD — Eversource still wants a $96 million rate increase next year. But in a filing due Thursday, it is expected to reduce the share that would be paid by customers in Western Massachusetts.
Civic and business leaders had assailed the proposal Eversource filed with the Department of Public Utilities in January, saying it unfairly penalized residential and business customers in Berkshire County by making them shoulder a disproportionate share of the increase.
As a deadline passed Wednesday for written comments on the Eversource rate case, in advance of June DPU hearings, criticism continued to mount against the utility's plan.
Now, with Eversource pledging to submit a revised proposal, it appears electricity customers in the region could be spared some of the additional $35.7 million Eversource wanted to charge them in 2018. One analysis found that customers in Western Massachusetts would on average pay $166 more next year, compared to an average increase of $50 for customers in the eastern part of the state.
But it remains to be seen how much Eversource will shave from the Western Massachusetts increase — or how customers elsewhere will respond to a rising share of the increase.
Priscilla Ress, a utility spokeswoman, said Wednesday the increase facing Berkshires customers under its proposal would fall "by a substantial margin." The change comes in response to comments at public hearings, she said.
No specifics were available Wednesday. "We are in the process of looking into this and crunching the numbers," Ress said.
The change affects the design of the rates, she said, not the overall increase Eversource is seeking. "It's going to make a significant difference for many customers in the west," Ress said.
At the same time, she defended the basis for the earlier rate structure, saying it stems from revenue gaps in Western Massachusetts, based on the smaller number of customers, compared to the eastern part of the state.
Of the utility's 1.4 million customers in the state, 209,000 live in the western region. Ress said that the change to be outlined in the new filing will likely lead to costs rising elsewhere in the state. "Clearly someone is picking up the cost," she said.
Though rates are still poised to rise in Western Massachusetts — provided DPU commissioners approve, after deliberations that will stretch into late fall — the utility's recent move is good news for electricity customers in the region.
The change sought by Eversource was greeted warmly Wednesday by one of the leading critics of the utility's proposal.
Patricia Begrowicz, president and co-owner of Onyx Specialty Papers Inc. of South Lee, said the shift indicates local voices against the size of the rate increase are being heard.
"It makes a difference. Whether it can stick remains to be seen," she said of the Eversource change.
"This was a very unique move for Eversource to have made in the 12th hour," Begrowicz said. "It will be interesting to see what the DPU decides to do."
Begrowicz filed a four-page, single-spaced letter with the DPU Tuesday on behalf of commercial and industrial electricity customers in the county. She provided vignettes from seven companies charting the impact their leaders believe the utility's original Jan. 17 proposal would have on them.
"A similar distribution rate increase in 2007 ... resulted in the loss of 400 jobs that we know of," Begrowicz writes, "and lost job growth we cannot calculate. This should not happen again."
Begrowicz said she assembled the report at the urging of Attorney General Maura Healey, who heard aspects of the story at the Pittsfield public hearing.
Pittsfield Mayor Linda M. Tyer filed a three-page letter Tuesday with the DPU expressing her "strong objection" to the rate increase, saying it would have "devastating consequences on economic development, municipal operations, and residents for the City of Pittsfield and all of Western Massachusetts."
Under the original proposal, Pittsfield stands to pay $708,336 more for electricity to power its buildings in 2018 and $27,783 more for streetlights.
The increases, if approved, would begin Jan. 1. The utility is also seeking automatic 3.5 percent rate increases for five years.
In an interview Wednesday, Tyer noted the complexity of the Eversource proposal — now poised to become even more so.
She appealed to the public to pay attention to the rate request process, but said it falls to civic and business leaders to lead the fight to protect consumers from what she sees as an "exceedingly unfair" request.
"It's really our job to be on top of it and be advocating for residential ratepayers," Tyer said. "They're not in the weeds on this the way we are."
The office of the Attorney General, though it opposes the overall rate increase, is criticizing the timing of the Eversource adjustment. In a DPU filing, it asks the agency to extend the comment and review period, in part because the Eversource changes could result in higher bills for customers not yet notified of that possibility.
The AG's office also argues that because Eversource had not provided full information a week before DPU hearings are scheduled to begin in June, the utility's proposal cannot be adequately examined.
In a May 19 filing, one of dozens in the rate case by parties on all sides, Eversource said its new proposal will shift the way revenue is pulled from its eastern and western regions, among other changes.
In a May 25 letter, the company pledged to produce by Thursday a full analysis of how the changes would affect customer bills. That's too late, according to a filing by Assistant Attorney General Joseph W. Rogers.
"Customers have a right to know the impact of their modified rate proposals on their individual bills," he wrote, "and the opportunity to exercise their statutory and constitutional rights in regards to that increase."
Though the utility downplayed the nature of the rate mechanism change in one DPU filing, it constitutes a significant change that should affect the DPU's review, Rogers argues.
"The Company's 'protest-too-much' May 25 letter attempting to characterize the yet-to-be filed June 1 rate design changes as 'targeted modifications' is not only irrelevant, it is wrong," he writes.
Then there is the sheer volume of data that needs to be studied on the eve of DPU hearings, Rogers noted. A witness for the AG's office had said, in testimony filed with the DPU, that it would take weeks to go through the new rate proposal. He noted that the original rate design details took up more than 1,000 MB of data in 70 separate electronic files.
Reach staff writer Larry Parnass at 413-496-6214 or @larryparnass.
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