Editor’s note: This commentary is by Chris Recchia, who is the commissioner of the Vermont Department of Public Service, appointed by Gov. Peter Shumlin in December 2012. Prior to that he was deputy secretary of the Agency of Natural Resources, and also served as commissioner of the Department of Environmental Conservation under Governor Howard Dean.
[T]his past week, we had the opportunity to engage in a constructive discussion about Vermont ratepayer advocacy with the Legislature. This grew out of a request for a self-evaluation by the Department of Public Service as to its structure and mission compared to others around the country, and how we perform our work on behalf of Vermonters. We issued a report in February with our findings.
Our report shows Vermont to be very successful in its mission of both protecting ratepayers and advancing the energy and telecommunications goals of the state. In my testimony before the Senate Finance Committee I was able to discuss the different structural models around the country and how Vermont compares. Our analysis looked at all 42 states with advocacy divisions, and finds Vermont outcomes on behalf of ratepayers to be among the most successful in the nation.
Nevertheless, there are some critics who believe we should restructure the department and establish an independent ratepayer advocate separate from our integrated public advocacy work. We disagree.
In Vermont, we have a public advocacy structure that strongly looks out for ratepayers in the performance of its work every single day. Almost all Vermonters are ratepayers for electric utility services: many also for gas, and telephone services. However, almost all Vermonters are also taxpayers, consume energy to heat their homes, and have other expenses that can’t and should not be considered in isolation. Vermonters also care about their environment and want us to lead by example. This is why we integrate a strong public advocacy focus into our review that considers all the impacts of a proposal, and not a single one in isolation. Our structure works to the benefit of all Vermonters to keep their energy bills stable and as low as possible while ensuring reliable and good quality service in the pursuit of statewide energy and telecommunications goals. In short, it is a balanced process that considers the overall impacts to Vermonters as consumers, taxpayers, and beneficiaries of an energy infrastructure that will meet the state’s future energy needs while emphasizing protection of ratepayers and preserving the Vermont environment we hold dear.
Our analysis shows the structure and reporting hierarchy are not determinative as to whether ratepayer interests are appropriately represented — it is the people working day to day, and their dedication to the mission, that matters most.
As commissioner of the Department of Public Service, I am appointed by the governor, and I in turn appoint the public advocate, who works with a staff of seven attorneys to advance this advocacy work. The current public advocate has over 25 years of utility rate-making experience and watches out for ratepayers in every single project or utility rate-making proceeding. Together, we do our best to assess what is in the public interest, what is consistent with the law and legislative policy, and what best serves and protects ratepayers from bearing undue cost. It is a balance. It often involves complicated financial analyses. But my staff is dedicated, and does extraordinary work every day to bring fair value to ratepayers and the public, and with that commitment, focus, and open communication with other stakeholders, we get it right most all of the time.
And this work yields results. For example, we’ve aggressively fought to lower Vermonters’ electricity costs. Three of the last four years have seen bill decreases for a majority of Vermonters, while electricity costs around the region have skyrocketed. We have saved ratepayers over $30 million on electricity during this period. This is a direct result of my department’s advocacy to provide efficient and effective utility regulation.
Opponents cite seven states they believe to have a better structure for advancing ratepayer interests than Vermont. I had the opportunity to present to the Legislature data which show this to not be the case. Results matter, and Vermont is showing it can achieve its environmental and energy goals while keeping bills low and stable. No other state — including the seven others proffered — can make this claim.
Any governmental structure has its pros and cons. Other states have various models, some appointed by the governor directly, some by the attorney general and some by the legislature. All report to officials elected by the people they serve. Our analysis shows the structure and reporting hierarchy are not determinative as to whether ratepayer interests are appropriately represented — it is the people working day to day, and their dedication to the mission, that matters most.
A well-respected national firm that does ratepayer assessments and which Vermont has used for decades in our utility rate cases offered the following unsolicited opinion: “Larkin [Larkin & Associates, PLLC] has represented many advocates in many jurisdictions, and Larkin is of the opinion that the Department in Vermont ranks as one of the top advocates for ratepayers.”
We look forward to continuing the dialog and gaining input from both the Legislature and the citizens of Vermont on ways to improve. There is always room for improvement, are open to that and welcome constructive steps to improve our advocacy on your behalf. That said, we should not restructure something that isn’t broken nor “throw the baby out with the bathwater.” I am confident that Vermonters as a whole feel pretty good about the path we are on, and that the Legislature will see the wisdom of our system as they continue this healthy analysis.
Regardless of the structure, my staff will continue to do an extraordinary job of representing ratepayers and all Vermonters we serve in the public interest, just as they have been over the last several years, and that is work for which I am, and all Vermonters should be, both appreciative and proud.
