The PUC Got it Right and Eversource, Naturally, Complains

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D. Maurice Kreis, NH Consumer Advocate

Power to the People is a column by D. Maurice Kreis, New Hampshire’s Consumer Advocate. Kreis and his staff of four represent the interests of residential utility customers before the NH Public Utilities Commission and elsewhere. It is co-published by Manchester Ink Link and InDepthNH.org.

By D. Maurice Kreis, Power to the People

It was a dark and stormy night.

So begins an otherwise forgettable novel written in England by Edward Bulwer-Lytton and published in 1830.  The subject was highway robbery.

Bulwer-Lytton’s paradigm example of purple prose sprang to mind on June 22 upon receipt of a not-so-forgettable pleading, submitted by Eversource Energy to the New Hampshire Public Utilities Commission (PUC).  In a roundabout way, it too was about highway robbery.

“[I]t is the utility that must operate the system in the dark of night,” bemoaned the Granite State’s biggest electric distribution utility, through its lawyer.

What inspired Eversource to remind its regulator that neither snow nor rain nor heat nor gloom of night (to quote the ancient Greek historian Herodotus) shall stay this company from the swift completion of its appointed role as a public utility?

Though Herodotus is quoted here out of context, this literary allusion, too, is appropriate.  The Eversource sentence in question ended with a reference to “major weather events when neither a stakeholder group nor independent engineer are behind the controls.”

The quip about a “stakeholder group” and an “independent engineer” give it all away.

It was not a dark and stormy night, but rather the pleasant Friday afternoon before the Memorial Day weekend when the PUC issued an order entitled “Guidance on Utility Distribution System Planning and Order Requiring Continued Investigation.”

Do not let this prolix title – or the length of the order (a hefty 83 pages) — fool you.  This is the most consequential and ratepayer-favorable order the PUC has issued in many a dark night.  So, it is hardly surprising that Eversource hates it.

Way back in 2015, at the express direction of the Legislature, the PUC opened a docket to investigate the question of grid modernization, commonly referred to (at least in utility circles) as “grid mod.”   Exactly 1,758 days later, the PUC finally decided what it wanted to do.

Spurning utility requests to use grid mod as an excuse for automatically putting expensive investments into rates with essentially no scrutiny, the PUC instead decided it’s time to open up to public inspection the process by which utilities decide which expensive toys to buy.

The PUC did that by announcing the advent of the “Grid Modernization Stakeholder Group.”  These days, people in public policy circles use “stakeholder” where once (in more countercultural times) the word “public” sufficed.

According to the PUC’s order, the Grid Modernization Stakeholder Group will not just advise the state’s electric utilities on how to modernize their distribution systems to account for emerging technologies and consumer demand for money-saving (and planet-saving) changes like time-varying rates, active demand response initiatives, backyard solar panels, and community power aggregation.  The PUC decided to insert this new stakeholder body into the whole process by which the PUC scrutinizes all major investment decisions by electric utilities.  By statute, this process is called “Least Cost Integrated Resource Planning.”

Quite sensibly, the PUC decided it can’t draw a meaningful distinction between grid mod investments and so-called “business as usual” investments.  Utilities have been required for the past century or so to invest prudently, and that includes the use of new technologies when appropriate.

It is this interjection of stakeholders into the whole planning process – a pretty big democratizing step – that really set off Eversource.   They especially hated the idea, originally proposed by witnesses for the Office of the Consumer Advocate (OCA), of having the PUC hire a so-called Independent Professional Engineer.

Eversource has an army of engineers on its payroll and its New Hampshire subsidiary is headed by an engineer.  But most stakeholders, including the OCA as the advocate for residential ratepayers, don’t have any engineers at the ready.  So, hiring one to help the stakeholders make sense of utility planning decisions is both logical and empowering.

So, of course, Eversource hates it.  Eversource’s June 22 pleading, asking the PUC to reconsider, reduces to a single, succinct message to both the regulators and the stakeholders:  We’re the utility; you’re not.  So, stay out of our business, just like you’ve been kept out for more than a century.

“[W]hile the utility’s discretion would be limited and its judgments discounted, it would still retain all of the risks associated with its obligation to provide service to all customers,” Eversource complained to the PUC.  “Such a system when applied to all manner of utility investments is ripe for abuse, delay, confusion, and discord.”

There are at least two things wrong with this argument.

First, Eversource is distorting what the PUC actually decided.  The stakeholder advisory group won’t actually oversee anything; that’s why it’s called “advisory.”  The PUC retains all of the ultimate authority, which by statute has for decades included “general supervision” of the state’s utilities.

Second, if the grid modernization order is so unworkable, so unreasonable, and so unfair to utilities, then why is at least one of the state’s electric distribution companies – Liberty, based in Londonderry – apparently willing to live with the grid mod order?  (New Hampshire’s third investor-owned electric company – Unitil – filed a one-sentence letter, well after the deadline for seeking reconsideration, saying it agreed with Eversource.)

Alas, the reconsideration motion filed by Eversource is, in legal terms, the required first step in an appeal to the New Hampshire Supreme Court.

As I suggested in our formal opposition to the Eversource motion, I hope the PUC sticks to its guns.  Chairwoman Dianne Martin, and Commissioners Kathryn Bailey and Michael Giaimo, deserve thanks and appreciation for their decision, supported by a bold statement that “[a] more granular and transparent approach to distribution system planning is necessary to ensure that investments are prioritized in a manner that accommodates an evolving electric system, while maximizing ratepayer value.”

Maybe it’s inevitable that anything that good will have to be defended at the New Hampshire Supreme Court.  If so, bring it on.

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