Utility regulators concluded in a draft decision Tuesday that Connecticut Light & Power was “deficient and inadequate” in its preparation and response to the two storms that caused prolonged blackouts last year.

The report by the Public Utility Regulatory Authority says the state’s largest power company should face unspecified financial sanctions “as a penalty for poor management performance and to provide incentives for improvement.”

[Text of PURA draft decision]

CL&P was unsure if it will seek changes in the report before it is formally adopted by the authority Aug. 1.

“We are in the process of reviewing all 117 pages of the document and will decide if we will file written exceptions or participate in oral arguments in front of the commissioners before they issue their final decision on August 1,” said Mitch Gross, a spokesman for CL&P.

The draft released late Tuesday afternoon followed the tone set by two earlier reviews of how the subsidiary of Northeast Utilities handled damaged caused by Storm Irene on August 28 and the freak snowstorm of Oct. 29.

Each storm caused peak outages to more than 800,000 customers of CL&P and the smaller United Illuminating Company, with some areas blacked out for 12 days.

The report addressed the performance of electric, cable television, telecommunications, gas and water companies, but CL&P and its parent, NU, bore the brunt of criticism.

“Last year’s storms were a nightmare for Connecticut residents, and the response from Northeast Utilities was unacceptable,” Gov. Dannel P. Malloy said. “Today, PURA is echoing the earlier findings of the Two Storm Panel, the Witt report, and hundreds of thousands of Connecticut residents who experienced extended power outages after each storm.”

Witt Associates, a consulting firm led by former Federal Emergency Management Agency Director James Lee Witt, analyzed of how both of Connecticut’s major electric utilities, CL&P and United Illuminating, handled last weekend’s Nor’easter and the resulting damage. A second group commissioned by Malloy studied the overall response emergency agencies and the utilities to both storms.

The PURA report said that regulators will consider changes already made by CL&P in its procedures as it considers financial penalties, which likely would come into play if the utility seeks rate increases to cover storm losses:

“In considering appropriate reduction to allowed returns on equity in forthcoming ratemaking proceedings and in exercising its jurisdictional approval for recovery of appropriate 2011 storm costs, the Authority will consider and weigh the extent to which CL&P has recognized its shortcomings and taken concrete and measurable steps to embrace the need for aggressive, extensive restructuring of both its attitude toward storm management and establishment of new practices for execution of future storm response.”

Attorney General George Jepsen called the draft a positive step.

“Today’s draft decision clearly echoes our case in this proceeding and would assess meaningful penalties on Connecticut Light & Power for the company’s deficient response to Tropical Storm Irene and the October Nor’easter,” he said.

PURA joined others in finding that CL&P was poorly prepared for the storms, failing to aggressively line up emergency line crews. But the authority did not agree with complaints that it was too lightly staffed with linemen.

Its own consultant, Liberty Consulting, concluded that staffing was “reasonable.” The company employs more line crews per customer than other utilities, but its ratio of crews to miles of lines is below average. The authority will continue to study staffing, as required by a law passed by the General Assembly.

Mark is the Capitol Bureau Chief and a co-founder of CT Mirror. He is a frequent contributor to WNPR, a former state politics writer for The Hartford Courant and Journal Inquirer, and contributor for The New York Times.

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