Eversource puts tab for memberships on ratepayers
Utility seeks reimbursement for fees paid to business groups
EVERSOURCE ENERGY is pushing for state approval of a $284 million rate hike, and tucked inside all the documentation is paperwork seeking reimbursement for annual membership fees and dues the company pays to 74 business organizations and trade groups.
In the grand scheme of things, the $814,000 being sought by Eversource is not a lot of money. But the request by Eversource nevertheless rankles some consumer advocates, who see little benefit to ratepayers.
David Pomerantz, the executive director of the Energy and Policy Institute in San Francisco, said the vast majority of the business groups to which utilities belong engage in activities that are political in nature. His organization is seeking to draw more attention to the issue and urging state officials across the country to scrutinize the expenditures more closely. “They don’t even have to justify these fees,” Pomerantz said of the utilities.
Michael Durand, a spokesman for Eversource, said the utility’s recovery of dues and membership fees is long established practice. He said the company is not allowed to recover money spent for lobbying, advertising, or charitable activities, but is permitted to recover funds spent on memberships in organizations that supply relevant information about the delivery of electricity service or provide direct contact with customers. If an organization engages in lobbying, Durand said, Eversource seeks reimbursement only for the portion of membership fees unrelated to lobbying.
Eversource is also seeking $53,314 for membership dues to the Greater Boston Chamber of Commerce ($31,000) and 14 other chambers around the state. The firm is even seeking reimbursement for the fees it pays to State House News Service for news from Beacon Hill.
The largest Eversource reimbursement is for $417,219 paid to the Edison Electric Institute, which represents the nation’s investor-owned utilities and focuses on “public policy leadership, strategic business intelligence, and essential conferences and forums,” according to its website.
In May, Pomerantz coauthored a report entitled “Paying for utility politics,” which focused primarily on ratepayer reimbursement of utility fees paid to the Edison Electric Institute. The report described the Edison Electric Institute as “an inherently political organization” and said “utilities have become adroit at using EEI and other organizations to effectively and quietly influence policy while sheltering their shareholders from the bulk of the associated costs. Almost no other political organizations have the luxury of subsidization enjoyed by EEI and other representatives of the regulated utility industry.”
Pomerantz said the lobbying definition most state regulatory agencies use to exclude membership fees from reimbursement is fairly narrow, and doesn’t capture policy work that is political in nature.
Eversource’s memberships in business groups may also influence the lobbying activities of those organizations. In October 2015, for example, six Massachusetts business groups sent a letter to legislative leaders raising concerns about the state’s solar energy subsidies – an issue which Eversource has been a leader on. The utility is a member of five of the organizations – Associated Industries of Massachusetts, Greater Boston Chamber of Commerce, Massachusetts Business Roundtable, Massachusetts Taxpayers Foundation, and the Springfield Regional Chamber of Commerce.Several organizations to which Eversource belongs, including the Massachusetts Taxpayers Foundation and the Plymouth Area Chamber of Commerce, have also filed public comments in the rate case docket at the Department of Public Utilities. The letters don’t take a stand on the Eversource rate request, but they praise the utility’s work using language that appears to be cribbed from a form letter.
Attorney General Maura Healey, who is representing ratepayers in the Eversource case and is seeking a cut, not an increase, in rates, declined comment.