Hearings on a proposed Central Maine Power rate hike request have been postponed, as discussions of a potential compromise request move forward. Press Herald file photo
Central Maine Power has moved a step closer to a compromise in its request for three years of rate hikes, after asking state utility regulators to postpone hearings scheduled this week pending the outcome of ongoing settlement talks.
A memo filed May 11 at the Public Utilities Commission shows that CMP asked for the pause following discussions with key parties in the case that resulted in “significant progress towards a settlement.” Company lawyers then asked the PUC to table so-called evidentiary hearings set to begin Tuesday. One of the staff attorneys overseeing the case, Eric Bryant, then agreed to put the hearings on hold indefinitely.
That paved the way for settlement talks to resume Tuesday and possibly continue into Wednesday and Thursday, according to the memo. As is customary, the talks are confidential.
If a settlement is worked out, it could head off a pending high-stakes decision by the commission in July.
It’s not unusual for utilities to pursue a settlement outside of formal rate requests, particularly in costly, time-consuming cases such as this one, which began 11 months ago. CMP and the Maine Office of the Public Advocate have been quietly pursuing an agreement at the PUC since early March, when an attorney for CMP sent a letter to the agency to set up an initial conference. They already have met at least three times.
Since the discussions aren’t made public, there will be little information released unless key parties in the case come to terms. Any deal outside the formal rate-setting process must be approved by the three PUC commissioners.
“We are continuing to make good progress towards a settlement,” Bill Harwood, Maine’s public advocate, said Monday.
CMP has an incentive to reach an outside deal, known as a stipulation.
The referendum campaign to take over the assets of CMP and Versant Power and form a public distribution utility called Pine Tree Power is heating up ahead of a vote in November. Moving past the rate case might spare CMP some negative publicity just as Mainers are weighing the merits of the takeover plan.
The company didn’t provide a comment following an inquiry on Monday, but earlier this month said it was open to discussions on compromise.
Takeover proponents, organized around the Our Power citizen group, wrangled over the wording of the ballot proposal, which was ultimately revised and sent on by the Legislature to the November ballot. Meanwhile, CMP’s domestic parent company, Avangrid, continues to fight the proposal, contributing more than $13 million to a ballot question committee called Maine Affordable Energy.
COMPLEX RATES
Electricity supply rates have soared over the past two years in Maine, largely because of spikes in prices for wholesale natural gas used to fuel many New England power plants. Those rates aren’t controlled by CMP or Versant, which distribute power but don’t generate it – a distinction sometimes lost on ratepayers. But regardless of the cause, consumers are likely to resent any further increase in electricity bills at a time when inflation continues to ripple through the economy.
Compounding the problem, electric rates also are set to rise in July as part of an annual adjustment of utility expenses. That increase, estimated at $9 per month by Harwood’s office, is largely to pay for long-term power purchase agreements approved by the PUC and the net energy billing costs associated with renewable energy contracts such as community solar farms. CMP is required by law to enter into those contracts.
Last May, CMP asked state regulators to approve a three-year spending plan the company said was focused on increasing reliability and upgrading the distribution system to withstand climate change. The plan would raise bills for a typical home customer by as much as $10 a month by 2026, beginning with a monthly hike of about $5 by September.
The request immediately drew opposition from Harwood, representatives of low-income and elderly groups, and the administration of Gov. Janet Mills.
Most recently, CMP’s rate request has been refined into three increases over three years, according to information released by the public advocate, starting with $44 million in the first year, then $28 million and $24 million. Harwood’s office has proposed a single, smaller hike of roughly $18 million. If that recommendation is accepted, it would add $1.80 a month to a typical residential bill.
A settlement would put an end to an exhaustive process that has been unspooling over the past 11 months in the formal rate case. A team of 17 agency staff has been gathering thousands of pages of evidence, testimony and documents from scores of intervenors. The agency’s three commissioners have hosted a trio of public hearings, where customers pleaded with the PUC to reject any rate increases.
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