AARP Vermont is not satisfied.
The group wants the state’s two largest utilities to pay ratepayers $21 million as a return for a bailout when the utilities entered into “imprudent” contracts with Hydro-Quebec in the 1990s.
The non-profit organization, which represents people over 50, is a party in a proceeding before the Vermont Public Service Board considering a merger between Central Vermont Public Service and Green Mountain Power.
AARP has pushed a campaign with a website and television ads that would require the utilities to pay back ratepayers based on their share of electricity usage.
The utilities initially proposed that $144 million in savings in the first 10 years would be sufficient to cover a requirement outlined in an earlier Public Service Board decision that required utilities in a profitable merger to refund money to ratepayers. In later testimony, the utilities proposed spending $21 million on an efficiency program in addition.
That doesn’t cut it, says Greg Marchildon, state director for AARP Vermont.
“It’s a convoluted corporate scheme,” Marchildon said. “It’s an attempt to make people believe they’re going to get something they’re not going to get. It’s an online bill loan program people pay back on their bill which is no payment at all. Where is a single penny being paid back to ratepayers?”
The utilities’ new proposal involves investing in an efficiency fund, similar to the one the board approved when Canadian utility Gaz Metro purchased Green Mountain Power. Part of the proposal would include on-bill financing where customers receive a loan for an efficiency retrofit on their homes and pay monthly installments on the electric bills, according to testimony submitted by the utilities.
The utilities assert the $21 million investment will result in greater net societal benefit, but Marchildon is unconvinced.
He said the AARP campaign has resulted in more than 13,000 petitions asking for money back.
Marchildon said the AARP will specifically target Gov. Peter Shumlin to get more involved and push for direct payback.
He said if utility executives don’t think the $76 that average households of CVPS ratepayers would receive under the AARP proposal is a lot of money, they should take a drive in rural Vermont to see the group’s constituents who are living on minimal income or meager savings.
Dorothy Schnure, a spokeswoman for Green Mountain Power, said the company absolutely disagrees that ratepayers will not benefit from the utilities’ proposal.
Schnure said the whole merger’s guaranteed savings of $144 million will go back to ratepayers in addition to a low-income trust that will produce $1 million a year.
She said the utilities came up with the new proposal after other parties in the proceeding filed testimony.
“We heard back from the department and others that we need to do more to enhance the benefits,” Schnure said. “This 21 million dollar investment will yield 40 million.”
She said the utilities will invest in efficiency and weatherization programs for CVPS customers. These programs, which will reduce overall electricity needs and reduce costs on the system as a whole through less peak demand, will better serve customers, she said.
A direct payback, Schnure said, would not truly reimburse CVPS customers who bailed out the utilities.
“It’s not the same people on the CVPS system as 10 years ago,” Schnure said. “That’s one of the reasons why just issuing a refund is not a direct one on one.”
The Department of Public Service agrees with the utilities that investing the money is a better means of creating value for ratepayers, according to Sarah Hofmann, deputy commissioner of the department.
“We believe a greater benefit can be returned to ratepayers by doing something with the money other than just giving everyone a check,” Hofmann said.
She said aggregating the money will create more value through investment opportunities.
While the AARP has focused on the Public Service Board, one lawmaker has proposed language in a Department of Public Service housekeeping bill that would require the utilities to pay ratepayers back on a per usage basis, as proposed by AARP.
Rep. Cynthia Browning, a Democrat from Arlington, said she thinks the $21 million should go directly back to customers.
Browning said she is skeptical of an insert in her CVPS bill stating that the utilities are proposing “an additional $21 million investment in energy efficiency for CVPS customers — on top of $144 million in guaranteed savings.”
Browning says the public relations is misleading in that it implies the company is offering extra money to ratepayers, when it is actually required to do so. She said the companies should also be clear that the money is not actually going back to ratepayers but going to another entity that will ultimately use it to make loans for efficiency projects.
“I think that the companies should be called to account for the misleading and incomplete information that they are putting out about the offer,” Browning said.
The Legislature has yet to discuss Browning’s proposal.
