Gov. Dannel P. Malloy’s top energy official voiced strong support Tuesday for legislation overhauling Connecticut’s energy policy, a year after former Gov. M. Jodi Rell vetoed a similar bill, saying it would raise rates.
Daniel Esty, Malloy’s nominee to run the proposed Department of Energy and Environmental Protection, told members of the General Assembly’s energy committee that he believes this year’s version of the wide-ranging bill will help to encourage the clean energy industry to locate and grow in this state and subsequently create much-needed jobs.
“There’s an enormous opportunity with this bill to put Connecticut out in front of the country,” said Esty, who is expected to be confirmed by the House of Representatives on Wednesday.
The 190-page bill includes major changes to the state’s electricity system, which state lawmakers voted to deregulate in 1998. Proponents hope the legislation will lead to lowering electric rates by as much as 15 percent; encourage renewable, homegrown energy sources, including solar and wind power; help reduce energy waste and lead to a long-range state energy plan.
The bill includes Malloy’s proposal to merge the Department of Public Utility Control with the Department of Environmental Protection. The new Democratic governor said the move is needed to centralize state energy policy, focus on energy efficiency and reduce rates. Connecticut consumers and businesses now pay some of the highest electric rates in the country.
Not everyone is confident the latest version of the bill will do what advocates are promising.
The Connecticut Business and Industry Association claims it includes too many costs and studies that will ultimately be paid for by ratepayers. For example, Kevin Hennessy, CBIA’s assistant counsel for energy and technology matters, said ratepayers would be the ones to pick up the $5 million tab over two years for replacing inefficient oil burners and furnaces.
He said ratepayers, under the bill, would also have to pay for some proposed pilot programs, such as a plan to turn agricultural waste at Connecticut farms into electricity. He also questioned why the state is the one choosing which alternative energy industry should receive incentives and funding, saying “picking a handful of ‘winners’ that are subsidized by all other electric ratepayers is not good public policy.”
Esty appeared to agree. At Tuesday’s hearing, he said he hopes to work with lawmakers over the coming weeks to make some changes to the bill, including broadening the types of energy sources eligible for incentives. Also, Esty said Malloy wants to encourage more private investment in these industries.
“We cannot continue to finance the activities we want to see on the backs of ratepayers,” Esty said. “We’re going to have to be creative on financing.”
Some concerns were voiced Tuesday about Malloy’s plan to combine DEP with the DPUC and whether environmental issues might become overshadowed by energy concerns. Esty said he believes it makes sense to combine the agencies because their missions overlap.
“I think you can’t make the choices that need to be made in silos,” he said. “The truth is, anytime you have multiple goals … it makes sense to have an integrated decision process.”
Mary Healey, the state’s consumer counsel, said her office, which represents ratepayers’ interests, understands the need to merge the two agencies. But she questioned why Malloy wants to move her office into the Department of Consumer Protection. She said it would harm ratepayers’ rights to an independent advocate.
Healey instead wants the Office of Consumer Counsel to become an independent wing of the new DEEP agency or a new Division of Ratepayer Advocate within DEEP.
The energy reform bill awaits approval by the legislative committee, but will likely be changed before it reaches the full General Assembly.
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