Local Government in Connecticut, Third Edition

24. Public and Private Utilities

ChApTEr 24 Public and Private Utilities Every time one enters a building or a home, there are some basic services that are so common one doesn’t even think about them—unless they don’t work. These are the utilities. In a good portion of the world, they do not even exist! This chapter covers these services and reviews who regulates them, who owns them, how they are provided, and how they are paid for. These utilities include electricity, gas, water, telephone, and television. Local government’s role in owning utilities is limited. Publicly regulated private companies provide most of these essential public services, although there are a few municipalities that provide several public utilities. Connecticut’s Public Utilities Regulatory Authority (PURA) is statutorily charged with regulating the rates and services of Connecticut’s investor-owned electricity, natural gas, water, and telecommunication companies and is the franchising authority for the state’s cable television companies. PURA replaced the former state Department of Public Utility Control (DPUC) and, along with the Bureau of Energy and Technology Policy, is part of the Energy Branch of the Department of Energy and Environmental Protection (DEEP). DEEP was created in July 2011 and brings together the state’s Department of Environmental Protection (DEP), the Department of Public Utility Control, and an energy policy group that had been based in the Office of Policy and Management. Electricity One of the most basic services is electricity, essential to our way of life. However, in many third world countries, there are people who never have used electricity! Many of these countries only have electric power for a few hours of the day. Connecticut Light & Power (CL&P), a publically traded company and a subsidy of Northeast Utilities (NU), is Connecticut’s largest electric utility. NU is also New England’s largest public utility. CL&P does not own any electric generation facilities. Another major company, United Illuminating (UI), services the greater New Haven and Bridgeport areas. Under Connecticut law, all of CL&P’s and UI’s customers are entitled to choose their energy supplier (generation), while the companies handle the 158 Local Government in Connecticut electrical transmission and distribution. Both CL&P and UI are regulated by the state’s Public Utilities Regulatory Authority. A few municipalities, such as Wallingford, Norwich, Bozrah and Groton, own their own electric utilities and provide electricity directly to their citizens, just like other town services. A few municipal-owned utility companies also provide natural gas. They sell the electricity to their residents, and in some cases, to residents in adjacent communities. Most Connecticut residents, however, pay a monthly electric bill to a major public utility company. Although most municipalities pay the utility company for streetlights, some communities own their own streetlights. Buildings, whether commercial or residential, have electric meters that record how much electricity (in kilowatt-hours) is used, and billing is based on this usage figure. Residential power usage is highest during the summer months owing to the use of air-conditioning. Electricity is generated in various ways, including nuclear energy, power plants burning oil, gas, or coal, trash-to-energy generating plants, solar panels, wind farms, and hydroelectric power plants. There is an increasing use of solar energy, which frequently offers financial incentives. Wind farms are increasing, although their introduction is usually controversial. The electricity that citizens use may not even be generated in Connecticut, but can come from an outside source as far away as Canada. The Northeast’s electrical systems are all tied together, and the power companies can switch the sources of the electricity that they provide to the citizens that they serve. This is done based on electricity demand, cost, availability, and/or problems associated with the transmission lines (the power grid). On January 1, 2000, legislation went into effect that allowed Connecticut residents to choose their electric supplier (generation source), even though the wires (transmission and distribution) that bring the electricity to the house (distribution) continue to be owned by CL&P and NU. This change in the law separated the generating source of electric power from its transmission and distribution network. It was an attempt by the state to make the electricity market more competitive, since electric rates in Connecticut had been among the highest in the nation Steadily increasing energy consumption has led to the formation of an energy conservation movement to protect the environment and promote alternative energy resources. The utility companies themselves have strongly promoted energy conservation, and have offered several energy incentives to the users of their services to encourage conservation. [3.145.58...