As state leaders work to address high energy, water, and communications services costs, it is essential to consider the potential impact of the proposed structural changes to the Public Utilities Regulatory Authority (PURA) – an independent administrative agency that sets utility rates and ensures “safe, clean, reliable, and affordable utility service” and infrastructure on already over-burdened consumers.
As Consumer Counsel, I commend the recent vote affirming legislative support for rigorous utility regulatory oversight. At the same time, there are critical questions that need thoughtful consideration before our state’s leaders move forward with changes to the regulatory framework for utility services that are critical to the health and well-being of Connecticut’s residents.
First, what are the legal implications of transforming PURA into a quasi-public agency, a model that does not appear to have been tried in other states?
Without the procedural rights guaranteed by the Connecticut Uniform Administrative Procedure Act, how will the ratepayer advocates at the Connecticut Office of Consumer Counsel (OCC) and other participants in PURA proceedings be assured full and fair due process?
What appellate rights will OCC and other litigants have should this quasi-public agency issue an anti-consumer decision? Throughout its 50-year history, OCC has both successfully challenged PURA decisions in court, as well as helped defend pro-consumer decisions issued by PURA that were challenged by corporate utility interests. These legal actions have saved consumers millions and secured vital consumer protections. OCC and other stakeholders need a guarantee that both due process rights and appellate rights will remain in place to protect ratepayers.
Second, how will the proposed changes ensure transparency in decision-making and address the increased risk of regulatory capture, an all too common dynamic where utility regulators become dominated by the interests they regulate rather than being driven by the public interest? PURA exists as a check on monopolies – to ensure, in the absence of competitive market forces, that corporate interests do not outweigh the public interest.
Quasi-public also means quasi-private, which might work well in the context of many of our current quasi-public agencies that have hybrid business missions, but what impact would moving this regulatory authority from a state agency to a quasi-public agency have on its unique balancing role? There must be assurance that PURA’s decision-making process is based on a public record and that prohibitions on ex parte communications remain in order to prevent the regulated from improperly influencing their regulator.
Third, what impact will these changes have on the momentum we’ve collectively built to increase public engagement and transparency in the utility regulatory decision-making process? Legislatively directed efforts to ensure that marginalized voices are heard and that consumers have better access to the decision-making process are making a difference in helping the public understand how utilities and rate-making proceedings work. However, these efforts are in their early stages. It is currently unclear how these initiatives would be affected by a shift in PURA’s structure. OCC will not accept a new system where stakeholders, especially consumers, lack a fair chance to participate and have their voices heard.
Finally, before approving any structural changes, who will conduct a thorough cost-benefit analysis to weigh the potential consequences against potential gain?
Beyond the unknown financial costs of implementing new systems – from procedural to information technology services – the public must have a clear understanding of how the proposed changes will impact PURA’s staff, who have spent years developing subject matter expertise supported by ratepayers. The potential loss of institutional knowledge and subsequent recruitment and retention challenges in a highly complex and technical field must be taken into account.
Make no mistake, this loss of institutional knowledge would benefit the utilities by increasing one of the biggest challenges we face in conducting oversight of our utilities – information asymmetry – and hurt consumers.
These are crucial questions that deserve thoughtful, clear answers. Ratepayers need to understand how these changes will affect their rights, their wallets, and the quality of service they receive from an agency that plays such a vital role in the day-to-day lives and operations of residential, commercial and industrial consumers.
Lawmakers must consider the effects this decision will have on the regulatory body charged with ensuring our utilities are acting in the public – not quasi-public – interest and on the consumers whose interests it is designed to protect.
Claire Coleman is Connecticut’s Consumer Counsel. The Office of Consumer Counsel (OCC) is an independent state agency that represents the interests of consumers of Connecticut’s electric, natural gas, telecommunications, and private water companies before PURA, federal regulatory agencies, the legislature and courts.