Utility Seeks

Rate Increase And More Profits

NEW BRITAIN (AP) — Business for Connecticut Light & Power Co. has been better than expected with the utility reporting it has made about $60 million more in profits in the past 14 months than allowed by law.

CL&P last week proposed to state regulators a rate increase plan to allow it to keep half of future windfall profits rather than returning the money to customers.

The utility contends a rate increase would attract new competitors and an increase could be structured so customers’ total bills do not go up.

“It would help create a robust market,” Michael G. Morris, chief executive officer of CL&P’s parent company Northeast Utilities, said Wednesday. “It is creative. It’s certainly different. We do feel it is in everyone’s best interest to go that way.”

In testimony before the Department of Utility Control, Mr Morris suggested leaving rates unchanged but allowing the company to keep half of any future over-earnings as an incentive to finding cost savings.

Mr Morris also suggested an alternative plan in which rates for electricity itself would be raised. The hike would be offset by cutting customers’ monthly competitive transmission charges.

The excess earnings were the subject of hearings Tuesday and Wednesday before the DPUC.

CL&P is negotiating with state officials over how much of the $60 million should be returned to customers and how it would be disbursed.

However, consumer advocates oppose raising the ceiling on CL&P’s profits.

“We are looking at measures we can take to recover the money and stop any excessive earnings,” Attorney General Richard Blumenthal said.

DPUC commissioners question whether they could legally raise the rate, which is capped by state law.