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Connecticut Protests Power Auction That Will Drive Up Future Rates

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By refusing to investigate, Jepsen said the feds failed to determine that rates are just and reasonable, as required under the Federal Power Act.

Connecticut officials are once again demanding an investigation of an electricity auction earlier this year which they claim artificially drove up prices for the entire region. 

Connecticut Attorney General George Jepsen wrote to the Federal Energy Regulatory Commission expressing concern over its decision not to investigate the February power auction held by grid operator ISO New England, which set prices in New England for 2017 and 2018.

Jepsen first filed a motion to intervene in April, claiming that Energy Capital Partners artificially withheld capacity during that auction by excluding the output from its Brayton Point power plant in Fall River, Massachusetts. He said the exclusion meant demand appeared to outstrip supply, driving up prices for the future period. He was joined in that protest by officials from Maine and New Hampshire.

Consumer advocatessaid the company was betting that it will make more money by driving up prices than it loses by taking the plant offline. The auction resulted in a 140 percent increase in capacity costs over last year. Connecticut rate payers, who last year paid $277 million, will end up paying $617 million.

But FERC took no action on the complaint within the time limit set out by its own rules, meaning that the auction results went into effect last month.

By refusing to investigate, Jepsen said FERC failed to determine that rates are just and reasonable, as required under the Federal Power Act. He's now filed a request for rehearing, and is joined in this latest protest by the state’s Consumer Counsel, officials from the Department of Energy and Environmental Protection, and the Public Utility Regulatory Authority.

Contacted by WNPR, Energy Capital Partners' Hartford-based affiliate, EquiPower Resources Corporation, said it believed the complaint against Brayton Point was no longer part of the Attorney General's case, and that the issues around the power plant had been resolved.

The Attorney General's office said the primary purpose of the latest request is not to assert allegations against any party, but to question FERC's adherence to its own processes,  "that FERC not approve auction results unless and until it resolves complaints that those results are tainted – that was our point when we initially filed, and even more so now that the Commission has allowed rates to go into effect without reviewing them," said a spokeswoman for Jepsen.

FERC has not yet responded to a request for comment.

Harriet Jones is Managing Editor for Connecticut Public Radio, overseeing the coverage of daily stories from our busy newsroom.

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