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State law would set strict limits on utility mergers
Credit: By JANICE PODSADA, The Hartford Courant, www.courant.com 9 March 2012 ~~
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Connecticut would set strict limits on utility mergers under a bill being pushed by lawmakers, apparently in reaction to the proposed merger between Northeast Utilities and Boston-based NSTAR.
The bill by the General Assembly’s energy and technology committee would bar the Public Utilities Regulatory Authority from approving a merger unless it met the following conditions:
—No rate increases for customers or ratepayers for five years after a merger;
—No negative impact on employment in the state for a period of five years;
—No diminished customer service, and no negative impact on the utility’s ability to provide reliable service;
—No reduction of the utility’s ability to prevent, minimize or restore any long-term service outage or disruption caused by an emergency.
The bill would also require PURA to review the merger annually for 10 years after its approval to assess the merger’s impact on operations, employment, customer service and utility rates.
“This merger bill is out for review and I think the position of myself and the committee is really self-evident in the bill’s language,” Rep. Vickie Nardello, D-Prospect, said Friday. Nardello co-chairs the legislature’s energy and technology committee.
It’s unclear whether the bill would apply to the proposed merger of NU and NSTAR. PURA is in the midst of that review and is scheduled to issue a draft decision March 26.
NU has said repeatedly that the merger, which would create a $17.5 billion utility serving 3.5 million customers throughout New England, would meet most of the conditions. However, many critics remain unconvinced, and state officials acknowledged this week that they are in talks with NU for specific agreements.
NU had no comment Friday.
Gov. Dannel P. Malloy said Thursday that unless NU and NSTAR offers Connecticut concessions similar to those the companies agreed to offer Massachusetts, the deal could be in danger.
In Massachusetts, NU and NSTAR earned the endorsement of top state officials earlier this year by agreeing to several major concessions. The companies promised to freeze electric rates for four years, distribute $21 million to Massachusetts ratepayers in the form of a one-time $12 to $15 rebate and purchase 27.5 percent of the power generated by the Cape Wind project, making construction of the offshore wind farm possible. The companies also promised not to have mass layoffs as a result of the merger.
A public hearing on the proposed bill is scheduled for March 15. Public hearings on the NU-NSTAR merger have already been held.
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