Lower electric rates, new jobs & renewable energy blocked by Rell veto.

Electric deregulation in Connecticut was a major mistake that drove up the cost of both electricity and natural gas. The deregulated electric market makes power plant owners and Wall Street elites wealthy at electric customers' expense.

I have been fighting, since I was elected to the legislature, to reform this costly system. Industry special interests have continued to block reform of the deregulation system, but I am continuing my work - pressing for a clean energy economy that saves money for electric customers and builds new jobs for the future instead of making Wall Street richer.

This year, I am proud to have won approval in the legislature of major reform that, if it was not vetoed by Gov. Rell, would have helped our state with:

Lower electric rates:

Connecticut's failed experiment with "electric deregulation" forces us to pay the highest electric rates in the nation. This not only hurts household budgets, it also costs jobs because our high electric rates make Connecticut a high-cost place for businesses to be. Change to this failed system is important. After years of fighting to reform this failed system, I am very pleased that the legislature voted to approve legislation that would lower electric rates. This legislation:

• Requires the Department of Public Utility Control to follow a new process that could result in cutting electric rates by as much as 15%
• Requires the Department to create a new discount in electric rates for households of modest income by 2011.
• Creates new consumer protections for people against abusive marketing practices by competitive electric suppliers, such as allowing time for customers to see their contract for service and cancel the contract after they have read it.

Green Jobs & Clean Energy:

And this legislation advances another important priority I have been strongly advocating for: growing our economy by investing in clean energy. This legislation:

• Creates greatly expanded solar and clean energy investments in the state - creating new opportunities for economic development and jobs installing solar and other clean energy equipment.
• To encourage new high-tech manufacturing in New Britain, the legislation includes a provision that I proposed that creates an extra incentive for solar equipment manufactured or assembled in distressed municipalities.
• Allows municipalities to set-up their own programs to assist homeowners in converting to renewable energy and making their homes more energy efficient.

Important progress being blocked:

This important legislation would represent a major victory for the people of our state. Unfortunately, its benefits - lower electric rates, renewable energy and good-paying jobs - are being blocked because Gov. Rell vetoed this important legislation.

Gov. Rell's decision to veto this important legislation is harmful to the environment, hurts job creation and forces Connecticut residents and businesses to pay the highest electric rates in the nation. Her veto was shortsighted and unfortunate decision.

Legislation to lower electric prices.

Connecticut's electric deregulation system has been a disaster for home electricity customers in Connecticut.  It has pushed our electric rates to the highest in the nation and it has been widely discredited nationwide.

Today's New Britain Herald reported on legislation that I voted to approve last week in the state House of Representatives that would roll back the failed electric deregulation system for residential customers:

“The people I represent want lower electric rates,” [Rep. Peter] Tercyak said. “For over 90 percent of customers, deregulation hasn’t worked. It’s led to the highest electricity rates in the nation.”

O’Brien, who has advocated repeal of electric deregulation since first elected in 2002, said the end of deregulation would be a victory for consumers who have watched rates climb over the years.

“The people of our state have been waiting a long time for this,” O’Brien said.

With the old, "regulated" electric market, utility companies had to keep their prices down based on how much it actually cost them to generate electricity and deliver it to us.  The system was never perfect, but compared to the current problems with electric rates, it kept prices lower.

The reason deregulation was approved by legislators before I was elected was because the people of our state were told, incorrectly, that electric rates would go down because deregulating the electric market would allow people to choose who generates their electricity.  The idea is that the old electric utility companies - for New Britain and Newington, CL&P - would continue maintain the power lines taking electricity to our homes, but each household would be allowed to choose which company makes the power they, individually, would use.

So you and your neighbor could be buying electricity from different companies, even though it would come through the same wires.  If that sounds like it does not make much sense, you are correct.  The system was designed to make it look like there was a real market in which you can choose the best price for electricity like you choose the best price for a dozen eggs but, in truth, it is complicated mess that allows companies that own power plants and Wall Street traders to make great profits at customers' expense.

That is why, it seems from the moment it became law, the promise of lower electric rates disappeared.  By the time I took office, even the advocates for keeping electric deregulation had to confess that deregulation was never going to lower electric rates.  In fact, they actually made the argument that electric rates would have to go up even more than they already had to attract more electric generation companies to the Connecticut electric market.  Most people I talk to do not care about choosing which company "makes" their electricity if it costs more to have that "choice".  They just want lower electric rates.

That is why have worked to undo the failed electric deregulation system.  Two years ago, I thought that we were close to accomplishing just that.  But the legislation that would have done it was defeated.  In its place, legislation arguably made things worse was approved.

That is why it is so good that, two years later, we won approval the state House of Representatives for rollback of electric deregulation by a 103-39 vote.

I hope that this legislation, combined with another bill that would create an organized and publicly accountable system for providing electricity in our state will become law this year.

In truth, however, both bills face an uncertain fate in the State Senate.  Hopefully, the Senate and Governor will approve this important legislation.

Renewable Energy and Conservation for New Britain in federal stimulus legislation.

Yesterday, I found out that New Britain is set to receive $653,500 in funding under the Federal Energy Efficiency and Conservation Block Grant program (EECBG) for the state of Connecticut. The funding is available for direct distribution to municipalities with populations of 35,000 or more.

This funding provides grants to states and local governments for projects that improve energy efficiency, reduce fossil-fuel emissions and reduce total energy use.

I am very pleased with this priority.  President Obama’s energy priorities are forward thinking.

Rep. John Geragosian is also pleased with this program.  He said, “These are difficult economic times for many people and the energy funding, used wisely, will help people with escalating energy costs.”

Rep. Peter Tercyak added that,“This is good news for New Britain.  Energy efficiency makes good sense and this money comes at a time when people are hurting and need a helping hand.”

Senator Donald DeFronzo noted that, “This is a good expenditure that creates jobs now and makes us less energy dependent in the future.”

Local governments decide how this funding will be allocated.  It would be best for the city to use this funding in a way that helps residents save money on their electric and heating costs, while at the same time, creating good jobs.

This funding can be used for:

• Development of an Energy Efficiency and Conservation Strategy and Technical Consultant Services to assist in the development of such a strategy.
  
• Residential and Commercial Building Energy Audits.
  
• Financial Incentive Programs and Mechanisms for energy efficiency improvements such as energy savings performance contracting, on-bill financing, and revolving loan funds.
  
• Grants to nonprofit organizations and governmental agencies for the purpose of performing Energy Efficiency Retrofits.
  
• Energy Efficiency and Conservation Programs for Buildings and Facilities.
  
• Development and Implementation of Transportation Programs to conserve energy.
  
• Building Codes and Inspections to promote building energy efficiency.
  
• Energy Distribution Technologies that significantly increase energy efficiency, including distributed resources, combined heat and power, and district heating and cooling systems.
  
• Material Conservation Programs including source reduction, recycling, and recycled content procurement programs that lead to increases in energy efficiency.
  
• Reduction and Capture of Methane and Greenhouse Gases generated by landfills or similar waste-related sources.
  
• Energy efficient Traffic Signals and Street Lighting.
  
• Renewable Energy Technologies on Government Buildings.
  
• Any Other Appropriate Activity that meets the purposes of the program and is approved by DOE.

On behalf of New Britain, I offer my thanks to President Obama and our member of Congress, Chris Murphy.

Legislation to help with gasoline and oil prices.

Years of federal policy that has allowed the big oil corporations and Wall Street traders to profit at the expense of the family budgets of ordinary Americans are coming to fruition with the unjust and massive increases in gasoline and oil prices we are experiencing. We need reforms in federal policies to reign in the excesses of Wall Street and the big oil corporations in order to bring prices down.

Even though the causes of this crisis are a federal issue, I wanted to take action to help people. That is why I voted to approve Public Act 08-2.

This legislation does several things. It stops major oil companies from using their franchise agreements to block local gas stations from offering to customers who pay in cash, rather than credit. The Attorney General says these discounts could save people 10 to 12 cents per gallon. This legislation also cancels the half percent increase to the gross receipts tax paid by oil companies that was scheduled to take effect July 1st.

In addition to rising gasoline prices, heating oil costs are going up. This raises the concern that people will have trouble paying for heating oil next Winter. That is why this legislation also authorizes the immediate release of $2.5 million from the Oil Conservation Fund, which can be used for the purchase of new, energy efficient boilers.

Hopefully, legislation under consideration at the federal level to reign in speculators on Wall Street who are driving up oil prices. But, either way, I hope that the legislation we approved here in Connecticut offers some relief.

Energy assistance and efficiency legislation.

As I meet the people I represent, many tell me about the difficulty that they have making ends meet because of the shock that is caused by the rise in energy costs. With winter coming, many people are really worried, and I have been advocating for action to help people.  I have been pleased that there is a broad bipartisan agreement between legislators and the Governor about the need for action. The legislature came into session this summer to approve energy assistance legislation.

In addition to the need to increase the amount of the assistance for people who are currently eligible for energy assistance (because fuel prices have increased), the rising costs of oil and other energy has created a problem for people whose incomes are over the current limits that needs to be addressed.  The legislature approved two items to items in order to address these issues.  The first, SB1101, does a few important things to help with this.  It provides:

• $4 million to assist people state residents 65 or older with incomes up to $48,787 for a single person or $63,789 for a couple. This home heating assistance includes deliverable fuel, electricity and natural gas.
• $8.5 million to Operation Fuel for assistance to households with incomes between $15,600 for a single person and up to $42,400 for a family of four. This home heating assistance also includes deliverable fuel, electricity and natural gas.
• $5 million to expand Operation Fuel’s assistance to households greater than 200% of the federal poverty level but equal to or less than 100% of the state median household income – this home heating assistance includes deliverable fuel, electricity and natural gas

SB1101 also:

• Helps our local schools by allocating $6.5 million for our local school districts to heat school buildings
• Lowers the minimum delivery from 150 gallons to 100 gallons
• Ensures that companies have the resources to honor prepaid contracts
  
  

The other legislation that was approved (SB1102) is meant to raise the amount of money available for people who are currently eligible for energy assistance by adding up to $35 million into an energy contingency account to:

• Provide emergency home heating assistance
  
• Supplement federal funding to the Connecticut Energy Assistance Program (CEAP)
  

And it does a number of important things to increase energy efficiency and save people money by allocating:

• $3 million added to the furnace or boiler replacement program
  
• $2 million to provide eligible state residents to repair or upgrade their existing boilers or furnaces to make them more efficient
  
• 0% loans through the Energy Conservation Loan Program to replace existing furnaces and boilers with more efficient ones
  
• $2 million to DECD for additional funding to their loan program for insulation, alternative energy devices, energy conservation materials and replacement furnaces and boilers
  
• $7 million to subsidize the cost of an energy audit to households that heat by means other than natural gas or electricity (currently the program is free to those households but cost $300 to all other households)
  
• $2 million to DSS to provide funding for weatherization programs to households in the CEAP program
  

And it also allocates:

• $3.5 million for heating assistance grants to non profit organizations that are human service or public health providers
  

I hope that this legislation goes a long way to help people this winter and increase our energy efficiency for the long run.

More information about the electricity legislation I opposed.

This evening, I received a summary from Rep. Vickie Nardello about the problems with the electricity legislation approved today in the State Senate.

Here is Rep. Nardello's summary analysis:

Problems in the Energy Bill

Efficiency Partnerships

-$60 million per year without accountability provisions like a limit on how much each partner can receive, an RFP process to choose which proposals to fund, a requirement that the person receiving the technology pay a portion of the cost and a licensure requirement instead of the more lax certification requirement

Metering

-“just voluntary” still costs $170 million b/c the system to support the meters is expensive

-customers can currently get on a voluntary basis time-of-use meters that are capable of doing on peak and off peak pricing, but the meters in the program are the “Cadillac” meters, which are capable of doing real-time pricing

-this moves customers toward real time pricing, which forces people to pay spot market prices, which are high and volatile – their costs will increase

Towns and Municipalities

-In 2005, EIA forced towns and school systems into expensive (mandatory time of use rates) and volatile (pricing changes monthly) standard of last resort service

-Towns and schools cannot shift their load because of the hours they operate

-the bill does not exempt towns and municipalities from supplier of last resort service or time of use rates

Rates

-the bill does not address the problems with the underlying wholesale market that are causing the standard service benchmark to be high

-the electric heat rate language only maintains the rate for 5 years and only applies to those already on this rate (i.e. no one new can get it)

Procurement

-bilateral contracting language doesn’t work because it doesn’t create a framework for the DPUC to do this outside the RFP process

-doesn’t remove the full service generation requirement (means that we can’t buy baseload, intermediate and peaking separately, making bilateral contracts directly with generators impossible)

Cost of Service

-does not allow the DPUC to consider a variety of ownership options in its integrated resources plan

-does not require all plants going forward (that ratepayers pay to build) to agree to sell their power at cost of service plus a reasonable profit, not the highest cost possible they can charge in the market

-utilities are only allowed to generate if they are outside a regulated rate of return and bear all risk for cost overruns, which turns them into independent power producers and negates the entire purpose of utility owned generation

Retail Competition

-ratepayers subsidize retail competitive marketers

-aggressive retail referral program encourages people to move to competitive suppliers, which increases the migration risk in standard service and therefore raises the standard service price

-state is encouraged to pursue competitive suppliers

-consumer protections were not included

Accountability

-does not include a cost effectiveness review for generation going forward to make sure the winning bids are in the best interest of ratepayers

-includes a number of programs with technology that is already funded elsewhere and is not cost effective ($30 million for renewables and combined heat and power in state buildings, $50 million for DG ($25 million earmarked for fuel cells) for businesses and state facilities)

-encourages use of a standard service portfolio manager, which creates a huge potential for market manipulation

Rep. Nardello also shared the following table summarizing the costs to consumers of the energy legislation.

The first two columns are pretty straightforward. They are the name for each part of the bill and the cost of each to consumers. The third column is the section number of the bill where is of these costs is created. The fourth column, labeled "7098" tells whether the cost was also in the House energy bill, HB7098.

Energy Bill Additional Costs
Program	Cost	Sec.	7098
Energy Efficiency Partnerships	$60 million per year	94	no
Energy Excellence Plan	unknown cost of the study	97	no
Advanced Metering System	$170 million plus up to $125 million of stranded costs	98	no
Energy Efficiency Marketing Campaign	$5 million	87, 111,127	no
Retail Competition Marketing Subsidy	unknown cost of the referral program	92	no
	Increased migration risk raises standard service price for all	92	no
Switching on and off SOLR (removal of anti-gaming language)	Increased migration risk raises standard service price for all	49	no
SOLR - Quarterly or more often procurement	Increased volatility for large and small businesses	49	no
Encourages state facilities to choose competitive suppliers	Increased migration risk raises standard service price for all	101	no
	Many towns have lost money through similar programs	101	no
CFL Fundraiser	$125,000	61	no
Emergency Generation Pilot Program	$10 million	103	no
Standard Service Portfolio Manager Study	Increased costs through market manipulation	104	no
Mandatory option of real time pricing	Aligns costs with spot market, likely to cause increased rates	99	no
Financial incentives for utilities to cut peak demand	unknown -- study	106	no
Grants for DG and fuel cells	$50 million in bonds($25 million-fuel cells)	108, 109	no
Renewables, Combined Heat and Power in State Buildings	$30 million in bonds	121	no
Natural Gas and Fuel Oil Conservation Programs	$10 million from gross receipts tax	115, 116	no (removed by FIN)
Decoupling	would have cost $72 million last year based on revenue numbers	107	different
Municipal Renewable Energy Grants	$50 million in bonds	90-91	yes
Furnace/boiler replacement program	$5 million bonding	1,2	yes
AC replacement program	~$9.7 million from ECMB	3	yes
Sales tax exemption for ice storage, solar, geothermal	$500,000 for 2008, $700,000 for 2009	68	yes
Sales tax exemption for weatherization products, including CFL	$7.5 million in 2008, $7.5 million in 2009	69	yes
Sales tax exemption for Energy Star appliances	$13 million in 2008	70	yes
Conservation in State Buildings	$30 million in bonds	73	yes
Restores ECLM funds	$95 million in bonds	79, 126	yes
Operation Fuel	$5 million	128	yes
Low income energy assistance			yes
CHIF low-interest loans			yes
CHEFA grants for efficiency projects			yes
CHIF low-interest loans			yes

So the items marked "no" in the "7098" columns are charges that consumers will have to pay because the Senate version of the energy legislation, rather than that House version, was approved.

The heroes in the unsucessful effort for lower electric rates.

In my previous post, I wrote about the electric legislation that was approved yesterday, minus the parts that would have finally brought our rising electric rates under control again.

Even though the key amendment they advocated for failed, I think it is important to mention two legislators who showed great courage on this issue. They are the House Chair of the Energy and Technology Committee, Rep. Steve Fontana and the Vice Chair of the Committee, Rep. Vickie Nardello.

This issue is so complex that it seemed easier to criticize Reps. Fontana and Nardello because of the disagreement they were having with other legislators than it was to look into the substance of the disagreement and see that the Fontana/Nardello electric reform legislation was the one that was really going to address the causes of rising electric rates.

Rep. Nardello has been working on this issue for many years, spending enormous time understanding this issue in great detail so she could advocate effectively on behalf of consumers. She was trying to undo electric deregulation before it really started to cause consumer rates to rise and, when rates did rise, her dire predictions were proven correct.

Rep. Fontana, who is also Vice Chair of the Connecticut Democratic Party, has taken a meticulous and sober approach to this issue, gaining a great understanding of it before concluding that serious reforms were needed to bring control back onto electric rates. He also worked very hard to reach compromise on an energy bill, while sticking to the most critical issue of restoring cost-based generation that is necessary to bring prices back down.

These two legislators deserve enormous credit for the time and effort they put into working on behalf of electric consumers, and for their principles in standing up for what is right.

Energy "compromise" bill, and why it is not real reform.

Right now, the House of Representatives is debating a bill ostensibly to address the problem of rising energy prices. The legislation is House Bill 7432. The real substance of the bill is in House Amendment A on the bill.

I have been working since I was elected to undo the system that has been causing our electric rates to skyrocket.

"Electric deregulation" was approved by the state back in the late 1990s, with promises to lower our electric rates by giving us a choice of who produces our electricity. However, electric deregulation was a failure, and became the tool energy companies, like Enron, used to bilk the entire state of California. In Connecticut, it has caused skyrocketing electric prices. Electric deregulation is an abject failure and is bad for consumers.

Since then, many legislators (especially Reps. Fontana and Nardello) and advocates for consumers and seniors have been working to reform the system and bring back common-sense control on electric prices, like we used to have, when our electric rates were lower.

And our work is the reason that legislators and the Governor are now feeling the pressure to approve energy legislation. But the legislation actually being considered right now fails to address the real problem that has been causing electric rates to rise.

This legislation makes only token efforts to bring lower prices. In fact, in a number of ways, the legislation has the effect of adding to electric rates. For example, the legislation will require that all electric ratepayers pay for the purchase of electric meters that will allow electric companies to charge people higher electric rates at the times of day most people use electricity.

I plan to vote for another amendment that would actually bring electric rates back under control. But, it looks like that amendment will be defeated.

I tried very hard to bring real reform. It is difficult to express how disappointed I am, on behalf of the people I represent, about how this has turned out.

12:37am update after the voting is done:
The real electric reform that would finally help electric consumers was House Amendment C. It was defeated on a 34-114 vote.

The final bill was approved 128-19. If I voted for the bill, I would be able to go out to my constituents and say that I voted for energy legislation. But I would know, in my heart, that it would not be true that this legislation solves the problem - high electric rates - that the people wanted electric reform legislation to get done. So the only right thing I could do was to vote against this poor substitute for real reform of electric pricing.

Office of Consumer Counsel supports House electric legislation.

The Office of Consumer Counsel (OCC) is the state agency responsible for representing the interests of consumers in the proceedings of the Department of Public Utility Control on utility issues - including electric rates.

So, with leaders in the state House and Senate divided on the terms of electricity legislation, it is very significant that the OCC has identified the legislation under consideration in the House of Representatives (House Bill 7098) as better for electric ratepayers than the Senate legislation (Senate Bill 1374).

The House bill is better. It would bring electric rates back under control, while the Senate bill would apparently actually increases rates even more.

The OCC did this summary comparing to the two bills...

Principle	Reflected in House Bill?	Reflected in Senate Bill?	Discussion
A restoration of some direct state control over energy costs.	Yes.	No.	Section 58 of the House Bill would require that some new power plants be built and compensated according to cost of service principles as determined by the Department of Public Utility Control, including a reasonable profit. Both utilities and non-utilities can build these plants and take advantage of this opportunity.
Allow some peaking power plants to be owned by the traditional utilities to reduce market risks.	Yes.	Yes, but in a way that leaves the utilities with risks but no rewards.	Section 54 and Section 58 of the House Bill would allow the utilities to own some peaking power plants to mitigate price spikes in the summer. Senate Bill Section 24 would allow the utilities to own power plants but would not offer then a reasonable profit to do so, while leaving them with the risk of cost overruns. Because there is no upside but only downside for the utilities to build, the Senate’s approach is not a realistic proposal to achieve some utility-owned generation that would reduce market risks for customers.
Maintain oversight of conservation dollars under the auspices of the successful Energy Conservation Management Board (ECMB).	Yes.	No.	The House Bill maintains ECMB oversight over conservation and energy efficiency measures, which has proven to be a successful model. Section 2 of the Senate Bill creates an electric efficiency partner program with only limited input and no oversight by the ECMB. The ratepayer contribution is up to 90 million dollars a year. If all goes well, then the ratepayers will get a return on that investment. However, to avoid customer confusion and duplication of effort, the dollars would be better added to the existing Conservation and Load Management Fund overseen by ECMB.

Principle	Reflected in House Bill?	Reflected in Senate Bill?	Discussion
Avoid burdening customers with payments for new equipment without a DPUC analysis of the costs and benefits.	Yes.	No.	Section 7 of the Senate Bill would require the installation of advanced electric meters for all customers on an aggressive schedule without an analysis by DPUC as to whether the benefits will outweigh the costs. CL&P has estimated in DPUC Docket No 05-10-03RE01 that full deployment of this system would cost $255 million dollars, plus the cost of stranding the investment of existing meters of an estimated $25 million a year for ten years. There is no evidence to date that the meters will benefit most customers or cause them to significantly shift their usage.
Achieve a low standard service price that can be enjoyed by residential and municipal customers.	Yes.	No.	Section 55 of the House Bill creates a procurement plan that, in conjunction with the other House provisions discussed above, will stabilize and ultimately reduce the standard service price. Section 23 of the Senate Bill has similar planning provisions but contains other provisions that will actually raise the standard service price. For example, Section 13 of the Senate Bill would subsidize retail suppliers and removes rules that prevent retail suppliers from using schemes to pull their customers onto and off of standard service. The Senate Bill appears to create migration risks that would actually raise the standard service price for all customers. The Senate Bill creates artificial competition for competition’s sake, whereas the House Bill seeks to establish the lowest standard service price for residential and municipal customers.

Principle	Reflected in House Bill?	Reflected in Senate Bill?	Discussion
Avoid disincentives to building new electric infrastructure.	Yes.	No.	Section 1 of the Senate Bill would require the electric distribution companies to submit a plan to the DPUC to sell off part of the high-voltage transmission lines that they are building in order to support other goals such as demand response. This would send the wrong message to others that take on the risk of building infrastructure. To achieve the worthy goal of fostering more demand response, it should be funded directly.
Restore some robust planning processes.	Yes.	Yes, but with more limited options and with less effectiveness than the House.	As discussed above, Section 55 of the House Bill and Section 23 of the Senate Bill, along with other provisions of both bills, will restore some needed planning processes for the essential product of electricity. However, the Senate Bill does not have a realistic proposal for adding some utility-owned peaking power plants to mitigate our market power risks and ensure reliability, which limits our planning options. Also, the Senate’s efforts to push customers onto retail choice may well make supply planning more difficult and less effective.

Press conference tomorrow on legislation to address rising electric rates.

Phil Sherwood, a New Britain resident and an advocate with the Connecticut Citizen Action Group, sent out this media advisory today.

The Connecticut Citizen Action Group (CCAG) and Attorney General Richard Blumenthal Discuss Campaign to Provide Rate Relief to CT's Electric Consumers

States oldest and largest public interest group and Attorney General Richard Blumenthal will hold a press conference to discuss legislation aimed at lowering electric rates including a 'call to action'
for the public to send copies of their electric bills to state legislators.

Hartford, CT. – As CT's failed energy policies continue to shower the electric generation companies and commodity traders on wall street with unprecedented profits while forcing consumers to pay record high electric rates, the 2007 legislative session is coming to a close in less than 60 days. Members of the legislature are now considering a bill, HB7098, that aims to lower costs for everyone.

The CCAG and AG Blumenthal will call for the legislature to not only enact long term solutions to the broken electric market but to also provide immediate relief by refunding hundreds of millions of dollars to ratepayers through a refund and to support concepts that allow the state to regain control over electric power generation. They will host a press conference on Monday, April 9, 2007 at 11:00 AM, in room 1B at the Legislative Office Building in Hartford.

WHO: The CT Citizen Action Group and Attorney General Richard Blumenthal.WHAT: Press conference with Attorney General Richard Blumenthal and the CT Citizen Action Group to discuss actions the state can take to solve the problem of high electric rates.
WHEN-WHERE: Monday, April 9, 2007 at 11:00 AM, Room 1B of the Legislative Office Building (LOB).

I plan to participate in this press conference.

I have been pressing for years for legislation to roll back Connecticut's failed electric deregulation system and restore a more reasonable system, like we used to have. If action is not taken soon on this legislation, things could get even worse then they already are. On the other hand, if the legislature approves the idea of a refund to consumers, rates could go down immediately.

I think that it is important that we get this done and done now.

Panel discussion at the Capitol on electric rates.

I am taking advantage of the State Capitol's new wi-fi internet access (which, by the way, is available to members of the public) to write you an update while I sit in the audience of hearing room 2C listening to the Energy and Technology Committee panel discussion on electric deregulation.

Different speakers have been talking about just how big of a mistake it has been for Connecticut to enter into the strange world of "electric deregulation".

Electric deregulation is taking away the laws that limit electric prices to what it costs companies to generate the electricity and, instead, letting the owners of power plants charge us whatever the open market will bear.

Connecticut has been, for years, now been phasing-into a deregulated electric market, and this deregulation is what is at fault for the huge increases we have been having in electric rates. All indications are that rates will continue to rise, unless the deregulation is undone.

Economists and consumer advocates have discussed the disastrous effects of electric deregulation in California in which Enron and other companies bilked consumers out of huge amounts of money and the harm to consumers deregulation has caused in Texas. Texas electric customers who are subject to deregulation pay dramatically more than customers in neighboring states. This is true, nationwide. Electric consumers in states with electric deregulation pay more than customers in states that never deregulated.

So, why did this happen? It is because the legislators who were in office back in 1998 were told that Connecticut had enormously costly electric rates and that only the "market reform" of electric deregulation would lower that cost.

Well, deregulation did not cut electric rates, as was promised. Instead, electric rates went up. By the time I was elected to the legislature, even the supporters of deregulation were confessing that deregulation would not lower electric rates. In fact, they even said that they wanted electric rates to go up even more, because higher rates would make Connecticut a more attractive market for marketers of electricity and, therefore, would give us a choice of electric companies.

So, in other words, when they were first getting deregulation approved, its supporters said that it would lower electric rates by creating choice of electricity suppliers. Now, they say that we must pay higher prices so that we can have a choice of electric suppliers. If this does not make any sense to you, don't feel bad. It does not make any sense to me, either.

That is why I am working so hard in support of legislation to undo electric deregulation and lower electric rates.

I will try to write, in the future, some more details about what needs to be done to go back to a common-sense system and lower electric rates.