Connecticut utility regulators approved a rate increase for the Yankee Gas Company on Wednesday, just ahead of the winter heating season.
The decision comes in response to Yankee Gas’ request last year for a nearly 27% increase in its allowed revenues, the largest such request for a Connecticut gas company in two decades.
Instead, the Public Utilities Regulatory Authority voted to allow the company to collect up to $802 million a year in revenues, which amounts to an increase of around 11% or $82 million over its currently authorized revenues. Those revenues will be collected through new distribution rates that will take effect retroactively to Nov. 1.
The increase incorporates PURA’s decision to offer customers a $40 million refund from the company’s sale of excess pipeline capacity onto the market. That refund will be reflected in rates over the next three years, according to the decision.
The decision does not impact supply rates, which are a separate component of customers’ bills.
A spokeswoman for Eversource, which owns Yankee Gas, said Wednesday that the company was reviewing the decision.
The decision will result in an increase of between $17 and $20 a month in the average residential customer’s bill, according to an analysis by the Office of Consumer Counsel, which advocates on behalf of ratepayers.
In a statement Wednesday, Consumer Counsel Claire Coleman said that while PURA’s decision was “more generous” to the company than what her office proposed, it still amounted to less than half of increase Yankee Gas originally sought.
“This ask was simply too high to be palatable given the economic realities faced by the customers Yankee Gas serves,” Coleman said. “While my team and I are still reviewing today’s decision, it appears that PURA correctly reduced the company’s increase to about $82 million dollars and ordered an appropriate return on equity reduction.”
The decision follows another rate case last week in which PURA voted to allow a $66 million rate hike for customers of electric utility United Illuminating. In both cases, regulators voted to allow the utilities more revenues than had been originally proposed in draft decisions developed under PURA’s former chair, Marissa Gillett.
Gillett announced she was stepping down in September following a protracted series of legal and political disputes involving utility companies, which had accused her of violating open-records laws and wielding unilateral control over the authority. Her resignation took effect on Oct. 10.
Attorney General William Tong referenced Gillett’s departure in a statement Wednesday calling PURA’s decision “disappointing” for families heading into winter.
“Once again, the utilities are being rewarded with a multi-million dollar rate hike after running their chief regulator out of town through relentless litigation and personal attacks,” Tong said. “These costs are unsustainable and I’m going to keep pushing back in every single one of these rate cases to make sure Connecticut families aren’t paying a penny more than absolutely necessary.”
Gillett’s successor at the helm of PURA, Thomas Wiehl, recused himself from the Yankee Gas case Wednesday as he had previously submitted testimony in the case while working as a staff attorney for OCC. Two other recently appointed commissioners, Janice Beecher and Holly Cheeseman, also did not participate in the vote, citing the limited amount of time they had to review the voluminous records.
Those recusals left PURA down to just two participating members on Wednesday: Vice Chair David Arconti and Commissioner Michael Caron. Both voted in favor of the final decision.
“We tried to find a fair balance between all the parties, not the least of which is our ratepayers,” Caron said in brief remarks before the vote. “I believe that we have come to a final decision that provides revenue that is sufficient enough to prudently manage the gas distribution system.”
The decision also marked the first fully adjudicated rate case for Yankee Gas since 2011. The company’s current distribution rates were determined by a settlement agreement reached in 2017.
Yankee Gas serves roughly 252,000 customers across Connecticut.