The Connecticut legislature has passed a bill that prohibits investor-owned utilities from charging customers for lobbying, trade association dues, public relations expenses, and efforts to argue for rate increases. If signed by Gov. Ned Lamont, Connecticut will join Colorado as the second state this year to pass legislation addressing utilities’ ability to fund their political machines from customers’ rates.
The state’s House of Representatives passed the bill, “An Act Strengthening Protections For Connecticut’s Consumers Of Energy,” on June 5 by a bipartisan vote of 115-33. The legislation passed the state’s Senate unanimously and with bipartisan support on May 26. One senator, a lawyer who also works for Eversource, the state’s largest utility company, recused himself from voting.
[Ed. note: this article has been updated on June 5 to reflect the Connecticut House’s passage of this legislation.]
Colorado passed a similar law on May 11. That law prohibited utilities from charging their customers for legislative lobbying. The Connecticut bill uses a more expansive definition of lobbying, prohibiting utilities from charging customers for efforts to influence administrative action by executive agencies as well.
The Connecticut bill would also require utilities to file annual disclosures to their regulator, the Public Utility Regulatory Authority (PURA), that would enable regulators and the public to better discern whether they are adhering to the prohibitions. The disclosures will begin next year, and would require utilities to include itemized lists of expenditures that they made on political influence activities, including both payments to third parties and the hours spent by utility staff on political influence activities.
Beyond the sections prohibiting utilities’ cost recovery of political activities, the bill’s provisions advance the state’s efforts toward performance-based ratemaking that would set utilities’ profits according to their success in meeting goals for reliability and affordability, rather than their capital expenditures. The bill also tightens the rules and increases the transparency of rate case settlements, broadens the PURA’s ability to consider affordability in setting rates, increases utility reporting on outage events, and provides funding for non-utility stakeholders to intervene in proceedings at the PURA.
Consumer advocates support bill, utilities oppose
Consumer and environmental advocates supported the legislation in public testimony in February, with many highlighting the bill’s provisions to protect customers from paying for utilities’ political activities. Supportive groups included the state’s Office of Consumer Counsel, AARP Connecticut, the Connecticut Citizens Action Group, Operation Fuel, 350 Connecticut, the Conservation Law Foundation, and Save the Sound. The Energy and Policy Institute testified in support of the Connecticut bill’s reforms to cost recovery of political activities, and in hearings for the Colorado bill.
Connecticut utilities and their trade associations testified against the bill at the February hearing. No other groups opposed the bill, though two utility-supported arts organizations, the New Haven Symphony Orchestra and the Creative Arts Workshop, praised utilities as “supporters of the arts” using identical language, complete with verbatim spelling errors. The groups asked that “legislators consider United Illuminating’s longtime positive impact on the arts community as they evalaute [sic] the full impact of the consequences of this proposed bill.” Utilities frequently rely on recipients of their charitable largesse for political support, as the Energy and Policy Institute has documented. The Connecticut bill would prohibit utilities from charging customers for charitable contributions.
Connecticut’s utilities have come under fire from citizens’ groups and legislators for their political influence. A 2021 report from the Institute at Brown for Environment and Society found that the state’s gas and electric utilities were the largest spenders on energy policy lobbying, frequently advocating against climate action.
Connecticut’s largest investor-owned utility, Eversource, spent over $305,000 on lobbying in the first quarter of 2023, making it the third-largest spender on lobbying in the state in that period, after two groups representing hospitals.
Energy and Policy Institute: Colorado law prohibits utilities from spending ratepayer money on politics