Connecticut suffers from some of the highest electricity rates in the country, and these challenges need to be addressed urgently. But the conversation in the state about how to combat the growing cost of energy for households and businesses has so far been incomplete, focusing on only one half of the equation.
Left entirely undiscussed: the gas utility sector and looming crisis of affordable heat.
Natural gas pipelines in Connecticut are aging and leaky, and the cost of the gas they transport is subject to extreme price spikes. Meanwhile, households and businesses are moving away from the direct use of gas, either for cost, comfort, climate, health, or safety reasons. The state’s natural gas utilities risk diminishing customer enrollment and demand per customer, spread over the same – or growing – infrastructure costs. This lethal confluence of trends is bound to send gas bills skyrocketing. Called the “gas utility death spiral,” this process will hit vulnerable communities (e.g. renters, low-income residents, fixed-income seniors) the hardest.
Customers who can upgrade their homes with the most energy efficient insulation, duct work, windows and doors, install high-performing efficient electric appliances and distributed resources like rooftop solar and home storage, and invest in energy management technologies, like smart thermostats paired with household devices that can maximize comfort and minimize costs, can achieve an unprecedented level of control over their monthly utility bills.
For all the folks who cannot afford to upgrade to a clean, affordable, all-electric home on their own, early state action to contain long-term gas system costs is absolutely essential. That’s why states across the country are upping their oversight of for-profit gas utilities. These efforts have included new gas infrastructure planning processes that align spending with state energy goals, utility “clean heat” plans to achieve state emissions reduction targets, pilots to test new business models for gas utilities, like thermal energy networks, and studies of financial and regulatory tools, like non-pipeline alternatives and gas demand response programs. Using any one of these approaches, Connecticut state leaders have the ability to minimize customer costs and risks throughout this moment of rapid transition.
Other northeast neighbors are similarly reliant on gas for heating, and they are already exploring better options. In late 2023, the Massachusetts Department of Public Utilities directed the gas utilities to begin reviewing their policies and practices related to new service connections to assess if new gas lines contradict Massachusetts’ policy and economic interests. And earlier this summer, the New York Public Service Commission adopted rules for utility thermal energy networks to create a new market for alternatives to gas, and opened a proceeding to create a framework to develop lower-cost and lower-risk non-pipeline alternative projects.
There are reasons to be hopeful. Connecticut state agencies have demonstrated they can step up on energy sector reforms and offer customer-centered support. The Public Utilities Regulatory Authority (PURA) has proven to be a strong ally to the state’s consumers on improving the electric system – seeking to reform the deep, structural issues and utility financial incentives at the heart of the energy affordability crisis, all while delivering cleaner, more reliable, and more resilient electricity. Connecticut’s Department of Energy and Environmental Protection is even leading an effort to accelerate adoption of affordable electric ground- source, air-source heat pumps and heat pump water heaters, via the New England Heat Pump Accelerator Coalition.
This collective work sets Connecticut up for a brighter energy future. But it’s not enough, because while progress on the electric side of our energy consumption is critical, the gas regime remains largely unchanged. That leaves residents and businesses currently hooked up to gas in a precarious position. State legislators passed the “Take Back Our Grid Act” in 2023 to address electric utility performance and establish a new framework for PURA to regulate, and adopting an equivalent strategy to evaluate the Connecticut gas sector would likewise be a useful step forward.
Connecticut is speeding towards a metaphorical cliff. The sooner the state can steer towards more solid ground, the better off its residents – who are captive passengers – will be. It is important to underscore that the status quo, business-as-usual approach is the worst, and most expensive option.
If legislators and the governor are serious about lowering energy costs for residents and businesses, they have to contain spending on the gas pipeline system just as directly as they confront them on the electric side of the ledger.
Connecticut legislators do not need to have all of the answers just yet, but given the long-lasting nature of the decisions we make about our infrastructure, we need to start the conversation today, and we hope Connecticut’s legislators will lead it.
Kat Burnham is Senior Principal at Advanced Energy United.
