Regulators propose cutting rate increase request by Connecticut Light & Power by $100 million

Government And Institutions Associated Press

Connecticut Light and Power's request to raise consumer costs by a total of $230 million should be cut nearly in half, state regulators said Monday.

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The amount sought by the state's largest utility was reduced by more than $100 million in the draft decision issued by the Public Utilities Regulatory Authority, which said the revenue levels it proposed would give the company opportunity to earn a reasonable profit while modernizing its system. The increase is to go before PURA's commissioners for a final vote Dec. 17.

The monthly service charge — a fixed amount that most residential customers pay regardless of usage levels — is currently $16, and CL&P asked for an increase to $25.50. On Monday, regulators said they would allow an increase to $19.50 monthly.

The Connecticut Business and Industry Association, the state's largest business group, had supported the original request while Wal-Mart, which operates more than three dozen stores in Connecticut, said the utility's proposal was excessive.

At least two Republican state senators, Art Linares of Westbrook and Joe Markley of Southington, allied with a coalition of labor, religious and environmental groups in opposition.

Consumer advocates and state officials including Gov. Dannel P. Malloy, Sen. Richard Blumenthal and others have spoken out against CL&P's request to raise $232 million to upgrade equipment following destructive storms and to toughen systems to prevent outages in the future.

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The Connecticut Business and Industry Association told regulators in September that the cost of energy in Connecticut is a "major concern" to its members, particularly manufacturers. But citing energy reliability, CBIA said power outages can cost businesses thousands of dollars.

"CBIA supports making our transmission and distribution systems as resilient as possible and therefore we support CL&P's position on cost recovery," it said.

CL&P, a subsidiary of Northeast Utilities, said about $117 million would pay for new and stronger poles, wires, transformers and substation upgrades. It has won permission from the state to recover $89.5 million for costs related to damage from storms in 2011 and 2012 and $25.3 million to protect equipment from storms in the future.

The utility has defended the rate request for capital improvements in equipment and systems. Electric reliability was better last year than in more than 10 years because of "targeted system improvements and replacements," spokesman Mitch Gross said.