CT Post-Conservation Programs in Peril, 6.11.08

Conservation programs in peril

ROB VARNON

Article Last Updated: 06/11/2008 12:40:07 AM EDT


State regulators who plan to strip $20 million from conservation programs this year in an
effort to ease the strain on family budgets are hearing protests from environmentalists
and the electric utilities that manage the programs.

The state Department of Public Utility Control will hear oral arguments Friday on a draft
decision it issued regarding the budget for the 2008 Conservation and Load Management
programs, funded by ratepayers.

The programs include incentives that help lower the price of compact fluorescent light
bulbs, energy efficiency assessments of homes and businesses by experts in the field, and
rebates on energy efficient appliances.

The state's programs were so popular in 2007 that they went over budget, prompting the
DPUC to allow Connecticut Light & Power Co. and The United Illuminating Co. to spend $12
million more than the original budget. But the final figures for the programs show the
total cost of conservation programs went more than $30 million over.

The DPUC ruled the utilities could "borrow" $20 million of that overdraft from fiscal
year 2008 funds, an amount one environmental advocacy group said represents about $2 to
$3 per year, per household. Even minus that $20 million, there is still more than $120
million available for conservation programs in Connecticut this year. The fiscal year
begins July 1.

DPUC spokeswoman Beryl Lyons said Tuesday the department does not comment on draft
decisions in ongoing dockets.

Spokespeople for UI and CL&P said the drop in funding has them concerned about the
ability to fully fund popular programs for the entire year. The utilities want to
continue to borrow ahead as needed.

Mary J. Healey, the state consumer counsel, said her agency filed an exception to the
DPUC's draft decision in order to have a voice in the ongoing discussion, but agreed with
what regulators are attempting to accomplish.

She said it's a prudent and cautious move to try to set and stick to a budget for the
programs while also trying to take some of the strain off the ratepayers who fund them.

"They've stepped up to the plate and funded lots of things," Healey said of Connecticut
electricity customers, and now it's time to find a way to support these programs through
a different source.

She and her colleagues at the consumer counsel's department said they support the
conservation programs and what they do, which is save people who take part in them money.
But the programs must do better at reaching poor and middle-class households, something
the DPUC noted in its draft.

The utilities, despite their objections to the draft, said they understand the DPUC's
position.

"The department is trying to strike a balance" between the benefits of the program and
its costs to ratepayers, said CL&P's Mitch Gross.

However, Gross said his company's concern is it will have to suspend some programs during
the year if money runs out.

It's less of a concern for UI, but it is a concern, said Pat McDonnell, the company's
director of conservation and load management.

McDonnell said his company did not go as much over budget last year as CL&P did, leaving
its programs in relatively decent shape. Still, he said, UI would prefer to be able to
seek additional funding if the programs do get oversubscribed this year.

Jessie Stratton, deputy director of Environment Northeast, said her group's biggest
concern is that CL&P, and maybe UI, will have to turn people away from programs at a time
when interest will be even higher.

She said in the 10 years Connecticut has had a conservation program, the amount of
electricity residents and businesses saved would equal the output of a new 640-megawatt
electric power plant.

The DPUC maneuver, according to Stratton, could just compound the funding situation in
2009, because people who were denied the use of a program this year could seek it next
year and that would essentially double the demand in 2009, she said.

Her group would like to see the $20 million back in the budget. If the programs get
oversubscribed this year, the utilities should be allowed to pull money from future
year's budgets, she said.

The DPUC is expected to make a final decision on the conservation and load management
funds next Wednesday