AARP Connecticut Urges PURA to Reject The Connecticut Water Company Rate Increase Request

Public Hearings in November and December Offer Ratepayers Opportunity to Provide Testimony

AARP Connecticut urges the Public Utilities Regulatory Authority (PURA) to deny the proposal by The Connecticut Water Company (CWC) to implement a rate increase that will raise the cost of water for Connecticut ratepayers by $21.4 million (18.1%) or up to $232 per year, depending on how much water a customer uses. The complete testimony submitted to PURA by AARP Connecticut is below.

PURA will hold two public comment hearings to receive ratepayer feedback on CWC’s application to amend its rate schedule. AARP Connecticut encourages potentially impacted ratepayers to voice their position at the November or December public hearings:

• Monday, Nov. 27, at 5:30 p.m.: Jonathan Trumbull Library, 580 Exeter Road, Lebanon, CT 06249
• Thursday, Dec. 14, at noon: virtually via Zoom

Residents can also submit a written public comment to PURA by writing to PURA at 10 Franklin Square, New Britain, CT 06051 or sending an email to executivesecretary@ct.gov.

“Utility rates are an essential pocketbook issue for Connecticut residents 50-plus and their families, many of whom struggle to pay their utility bills and other household expenses like food and medicine,” said John Erlingheuser, AARP Connecticut Senior Advocacy Director. “The economic effects of inflation and other pressures continue to impact Connecticut residents’ finances, and more must be done to help families access the water they need.”

The testimony AARP Connecticut submitted to PURA follows:

Application of The Connecticut Water Company to Amend its Rate Schedules
(Docket No. 23-08-32)
Comments of AARP Connecticut – November 1, 2023

AARP hereby submits comments on the Connecticut Water Company (CWC) rate case on behalf of its members in Connecticut who are served by the Connecticut Water Company. AARP represents residential customers, particularly the over fifty population. Many of our members are on fixed incomes. Others are low income and struggle to make ends meet in this inflationary environment. A 17.7% residential water rate increase plus increasing most residential customer charges between approximately 5.4% and 52% from existing rates, based on individual operating division of CWC, will be burdensome. We urge residential customer impacts to be top of mind in evaluating the CWC request.

Our specific comments are as follows:

The 10.5% return requested appears excessive.
CWC’s requested return on equity of 10.5% is excessive given the existing Connecticut Public Utility Regulatory Authority’s ratemaking policies which partially mitigate financial risks for CWC. The Revenue Adjustment Mechanism reduces the Company’s revenue volatility, with a lag, and the Water Infrastructure and Conservation Adjustment which allows CWC to begin to recover certain capital investments, with PURA oversight, between rate proceedings. It also may be higher than what other utilities around the country are receiving.

The customer charges should not be increased.
CWC proposes to increase the residential customer charges for all its operating divisions, except one, by 5.4% to 52% from the present rates. AARP opposes any increase to these charges. Such high customer charges make controlling your water bill more difficult and discourage conservation. We also question if the change is needed to align them across various operating divisions unless such an alignment provides tangible savings to customers.

The rate increase is too high.
The PURA should determine the cost effectiveness and need for the $21.4 million spending request. The average residential customers (15,000 gallons) will experience quarterly bill increases ranging from $18.80 to $58.69 based on the specific operating division of CWC serves. Unnecessary or uneconomic spending should be rejected. Spending should be phased in wherever possible.

The proposed modifications to CWC’s block rate structure need further review.
The Company’s proposal for a $1 per one thousand gallons (“TG”) increase in its second residential block rate and the implementation of a new third block rate with a $6 incremental increase from the proposed second residential block could adversely affect customers with high usage profiles.

AARP supports CWC’s commitment to innovative customer assistance programs.
CWC has shown a commitment to supporting customers having difficulty paying their bill with innovative programs like the Water Rate Assistance program, Help-2-Our-Customers program, and CWC’s Partnership with Operation Fuel to provide additional help struggling customers. These programs could be expanded to ensure customers facing financial difficulty have options for assistance with their water bills.

We appreciate this opportunity to comment.

John Erlingheuser
Senior Advocacy Director, AARP Connecticut