Connecticut Poised To Collect Millions More Through “Hidden” Electricity Tax
For the past two years, lawmakers have directed more than $100 million earmarked for energy efficiency upgrades to instead, be swept into the state’s general fund.
Last week’s budget agreement got rid of those funding sweeps, but it was unable to reverse a more than $50 million diversion scheduled for July.
Right now, if you’re a typical electric customer, you pay a small fee every month on your bill.
That money is supposed to fund efficiency work, providing discounts to ratepayers for home energy audits or weatherization services that can lower power demand and, in turn, drive down utility costs in a state with one of the highest electrical rates in the nation.
But over two years, lawmakers authorized sweeping $117 million of those ratepayer dollars into the state’s general fund.
A total of $63.5 million was raided last year. An additional $53.5 million of ratepayer money is set to be diverted to the state’s general fund in the coming weeks.
“We could definitely do a lot to serve the low income and middle class households, by allowing them to use their own money to reduce their consumption,” said Leticia Colon de Mejias, who owns a business that does home energy audits. She’s also part of a federal lawsuit challenging the sweeps.
“There are lots of contractors that have gone out of business in Connecticut since these cuts,” said Colon de Mejias, who said she had to lay off seven staff members because of the sweeps.
Amanda Fargo-Johnson, acting chair of the board that manages this fund, wrote in its annual report that the cuts, “resulted in considerable losses to economic development, carbon reduction and the environmental health of Connecticut.”
“We were really hoping that the raid that the raid that is planned to happen here in June was going to be stopped. And that did not happen this session,” said Leah Schmalz, with the advocacy organization Connecticut Fund for the Environment/Save the Sound. “That was a big disappointment.”
Schmalz said she’s encouraged that the most recent budget agreement between lawmakers and Governor Ned Lamont gets rid of the funding sweeps. Right now, that means for the next two years at least, energy efficiency funding will be restored.
“The Governor and the legislators are to be applauded for not looking to take money away from those programs again,” Schmalz said.
Colon de Mejias agreed, the news that the money is coming back is good.
But she said it doesn’t change that lawmakers “stole” ratepayer money.
“We’ve had two years of suffering,” said Colon de Mejias. “We lost many jobs. We’ve lost lots of local businesses.”