AG Lynch to intervene in electric company rate hike plan
1:44 PM Thu, Nov 05, 2009 | Permalink
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PROVIDENCE, R.I. -- Rhode Island Attorney General Patrick C. Lynch said Thursday he will intervene in the Public Utilities Commission's deliberations over Narragansett Electric's request to raise its electricity distribution rates by nearly 30 percent, an amount he termed "drastic." Lynch's ratepayer advocate, Special Assistant Attorney General Ladawn S. Toon, testified Tuesday to Lynch's opposition to the utility's proposed 29 percent distribution rate hike, which would result in upping the average ratepayer's monthly bill by about 11 percent, Lynch said in a news release. If approved by the PUC, the rate hike would result in a standard customer paying $8.95 more a month. "In the context of our state's strained economy and on behalf of Rhode Islanders who have been battered by job losses, shrinking wages and the soaring costs of fuel, prescription drugs, health-insurance premiums and so many essential household expenses, I think it's more than appropriate to examine the necessity of this proposed rate hike," Lynch said in the news release. He added: "Although I appreciate the actions it took in previous years of this decade to hold distribution rates level, there is little question that Narragansett Electric has been and remains profitable. It is making money. There also is little question that its parent company, National Grid, is making money. There is no question, however, that most of Narragansett Electric's customers, and certainly all of its low-income customers, are vulnerable and are suffering in this economy. Yet, Narragansett Electric has proposed a rate increase that is drastic. The proposal seems to lack awareness, let alone appreciation, of the hardships that Rhode Islanders are experiencing. At the very least, the term 'tone deaf' comes to mind. My office will fight to ensure that any increase that may be granted is thoroughly scrutinized, is just and is reasonable, although no increase will be palatable to most ratepayers." The Attorney General's Office routinely represents the Division of Public Utility Carriers [DPUC] in PUC rate hearings and is doing so in the pending docket hearings, which began Monday with public comment. The chief of Lynch's PUC Unit, Assistant Attorney General Leo Wold, is the DPUC's legal counsel. Lynch, however, also assigned an additional lawyer from his Civil Division, Toon, the special assistant attorney general, to "advocate for ratepayers' interests," he said. On Wednesday, Toon explained the rationale behind what Lynch called his "strenuous opposition" to another component of the docket, "revenue decoupling." Revenue decoupling means changing the way bills are calculated so that Narragansett Electric does not have an incentive to encourage greater consumption of electricity. "In theory, it sounds good because it may stabilize a utility's revenue stream, which could mean that there aren't as many wild swings up or down, based on market factors, in consumers' monthly utility bills," Lynch said. "Still, consumers will end up paying more, and it's by no means clear that they will benefit from decoupling as much as the utilities." He added, "When The Wall Street Journal praises an idea, you have to wonder how friendly the idea is to consumers." Lynch was referring to a Feb. 8 article The Wall Street Journal whose headline, "Less Demand, Same Great Revenue," alluded to the "Tastes Great, Less Filling" slogan of Miller Lite beer's long-running advertising campaign. The lead of the article reads, "It isn't easy to get utilities to promote energy efficiency, and for good reason: When people use less electricity, utilities usually lose revenue." Lynch said he opposes decoupling, particularly if it is implemented without well thought-out and meaningful consumer protections, because it is regressive and it rewards utilities with a guaranteed profit in exchange for the energy-conservation measures that consumers make. "When a ratepayer makes an environmentally conscious decision to turn down the thermostat, turn off the lights or buy energy-efficient light bulbs, the ratepayer should be rewarded with lower energy bills. The utility shouldn't be rewarded with guaranteed compensation because of the consumer's initiative," Lynchsaid. "Basically, decoupling transfers the fruits of the ratepayers' efforts to the utility. That's not right." 
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I don't understand. The energy companies want us to use energy saving products and one of their key arguments is it will save us money. So we use less energy but the rates go up. Where's the savings?
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Of course he is. He's running for Govenor and wants to show the people he cares. Funny he all of a sudden cares now. Hmmm, timing is everything.
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Finally, AG Lynch!! The PUC has repeatedly approved rate hikes, and this latest request IS criminal!
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Use 3% less electricity so they can apply for a date increase to get that 3% plus back.
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I praise the AGs action, the PUC is bought and paid for by the Utilities, they have not sided with ratepayers and all deserve pink slips. Disband the PUC and put the rate setting power in a more balanced entity, or add some actual rate payers to the the PUC, and watch as the Utilities tone down their requests for more profits.
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What ever happened to the rate increase of 21% last year just to off set the dramatic cost increase of oil & gas that the poor utilites had to suffer through to produce our energy? When oil & gas prices came back down somewhat and have stabalized, the electric rate never came back down when they had to pay less to produce the energy. That is the old "one way street" we went down and never came back from.
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People we know the game.
They want something like 10% so they ask for something outrageous and they get what they want.
Remember though there has been no inflation for a year.
Remember they haven't dropped natural gas rates or electric rates based on natural gas costs since wholesale fuel costs have been half or even a quarter of what they were since the last rate adjustment.
One honest person, is there just one honest person in all of politics in RI without some hidden agenda?
When everyone that runs for office is either corrupt or incompetent there is only one answer - MOVE.
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THE PIGS from national grid should
go on a diet.OH i forgot you cannot
PIG OUT at the supper table unless
you PIGS raise the RATES.---HELLO
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The puc should be elected by the voters of Rhode Island not be the ulitilty company
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Energy savings alone can create financial hardship for the provider... Lower energy provided = lower revenues... has to be made up somewhere!
Here is a supplemental piece regarding water conservation and consmption:
http://www.stepwiseadvisors.com/conservation-doesnt-always-pay
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Conservation can lead to a direct reduction in revenue streams. (here is a piece about water conservation and reduced utility revenue: http://www.stepwiseadvisors.com/conservation-doesnt-always-pay )
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