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State PBF/USF History, Legislation, Implementation

Connecticut
Last Updated: June 2011
Summary

Connecticut's 1998 electric restructuring law (Public Act 98-28) permitted competition within the state’s electric energy supply. The law also continued Connecticut’s consumer protection measures considered among the strongest in the country, including a strict winter disconnect moratorium.

To support consumers and energy conservation and efficiency, the law imposed three separate charges; one, a system benefits charge, which provided a mechanism to cover some of the two largest electric utilities' expenses in operating low-income assistance programs and their compliance with the state's consumer protection statutes (Conn. Gen. Stat. § 16-245l). The other charges are a conservation surcharge (Conn. Gen. Stat. § 16-245m) and a renewable surcharge (Conn. Gen. Stat. § 16-245n), which fund conservation and load management activities and renewable energy programs.

The Systems Benefits Charge, the Conservation Charge and the Renewable Energy Charge were combined for billing purposes into the Combined Public Benefits (CPB) Charge in 2006. The CPB charge is imposed on all customer classes of the state's two investor-owned utilities – Connecticut Light & Power (CL&P) and United Illuminating (UI). This charge collects the money used to support an energy efficiency fund and a renewable fund: the Connecticut Energy Efficiency Fund (CEEF) and the Connecticut Clean Energy Fund (CCEF).

The CPB charge also includes the costs that the Connecticut Department of Public Utility Control (DPUC) assigned to the original Systems Benefit Charge, including low-income assistance. This assistance has largely been limited to allowing UI and CL&P to recover their costs in implementing programs they operate to assist low-income households, but has not been used to fund new initiatives.

Electric utilities are allowed to use CPB funds to forgive arrearages and uncollectibles incurred by hardship customers, including the arrearage forgiveness mandated by statute for utility heating customers who are eligible for energy assistance (income at or below 60 percent of the state median income) and voluntary arrearage forgiveness programs available to low-income households, regardless of whether they heat with electricity.

During 2010, mandated arrearage forgiveness for electric heating customers amounted to about $8.7 million, serving 27,786 customers. (Conn. Gen. Stat. § 16-262c(b)(4)-(5) defines the statutorily mandated program).

Apart from the CPB, a gas arrearage forgiveness program has been mandated by statute for a number of years for households that receive energy assistance for their gas heating bills (Conn. Gen. Stat. § 16-262c(b)(4)-(5)). During 2010, gas companies claimed about $5.8 million in expenses for this program, which served 11,191 households.

The CEEF supports a variety of energy efficiency programs that provide financial incentives to help home and business owners reduce their energy consumption. Efficiency programs are reviewed by the Energy Efficiency Board (EEB), formerly known as the Energy Conservation Management Board, and approved annually by the Connecticut DPUC.

The Board is an appointed group of 14 members representing public and private entities or interest groups. Its original purpose was to advise and assist the two major electric utilities in developing and implementing efficiency programs. In 2005, the Board’s oversight was expanded to include the energy programs of the Connecticut Municipal Electric Energy Cooperative and the natural gas utilities – Connecticut Natural Gas Corporation, Southern Connecticut Gas Company and Yankee Gas Services. (Conn. Gen. Stat. §§ 16-245m, 7-233y and 16-32f).

In 2010, CEEF programs served several customer sectors: limited-income (up to 60 percent of Connecticut median income), municipal, non-profit, residential, school, small business, state government, university, and large commercial and industrial customers.

Limited-income households, formerly served under separate utility programs called WRAP and UI HELPS, are now served under the Home Energy Solutions Income Eligible program (HES-IE). Its 2010 program budget totaled $12.3 million for electric energy customers and $2.8 million for natural gas customers. Over 15,000 households were served, mostly through the state’s low-income weatherization network.

The programs offer a full range of energy conservation measures to address inefficient lighting, water heating, inefficient heating equipment, refrigeration and insufficient insulation. In 2010, CEEF funds helped the limited-income sector save 17 million kilowatt hours of electric energy, 559 thousand ccfs of natural gas, and 727 thousand gallons of oil.

Other programs

The Department of Economic and Community Development operates the Energy Conservation Loan (ECL) program for low- and moderate-income households based on Department of Housing and Urban Development area median income standards. (Depending on the area of the state, the maximum for a family of four ranges from $62,350 to $40,350; the lower figure is roughly equivalent to about 185 percent of the 2010 federal poverty guideline.)

The program provides loans for energy efficiency improvements and replacement furnaces and boilers in residential structures. Participants pay below market interest on loans for natural gas furnaces or boilers that meet or exceed federal Energy Star standards and propane and oil furnaces and boilers that are at least 84 percent efficient. Other improvements that may be funded include: replacement doors and windows, siding, insulation, heat pumps and solar systems and passive solar additions.

In 2010, according to its annual report, the program provided 312 loans totaling $3 million under the ECL program.

Evaluations

The publication “Evaluation of the 2005 UI Helps and WRAP Low-Income Weatherization Programs: Final Report,” summarizes the key findings and recommendations of a process evaluation of the 2005 WRAP and UI Helps.

Completed in December 2006 by Nexus Market Research, the evaluation showed that the programs accomplished their goals of reducing customers' energy use and bills despite limited program resources and a great demand for services. Participants reported high levels of satisfaction with and appreciation for the programs.

The evaluation noted that some participants in both programs received comprehensive services (e.g., insulation, refrigerators, etc.) that had a large impact on their energy use and bills; however, most participants received measures with relatively minor impacts (e.g., compact fluorescent lights and portable fixtures, faucet aerators, and showerheads).

The evaluation made 28 recommendations for both programs aimed at improving program delivery, goal measurement and achievement, and customer satisfaction.

For more information:

See annual reports from the Connecticut Energy Efficiency Board about energy efficiency programs, including low-income.

DPUC decisions on utility programs

Utility restructuring legislation, HB 5005, PA 98-28 (4/98)

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Page last updated: October 21, 2011