Eversource, Avangrid Face Investigation Into Alleged Market Abuse - NECN
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Eversource, Avangrid Face Investigation Into Alleged Market Abuse

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    Clear the Air
    NBCConnecticut.com

    The state Office of Consumer Counsel announced Tuesday that it is working with the Public Utilities Regulatory Authority (PURA) into an investigation into alleged market abuse and price fixing by Eversource and Avangrid.

    The PURA investigation began when a recent report by university researchers working with the Environmental Defense Fund alleged that the local companies run by Eversource and AVANGRID, which include Yankee Gas, Connecticut Natural Gas and Southern Connecticut Gas, intentionally manipulated the market to create shortage conditions and raise gas prices.

    The report estimates this caused a 38 percent increase in the average gas price and a 20 percent increase in the average electricity price in New England over the three-year period studied.

    Eversource called the report a "complete fabrication" and defended their operations.

    "The underlying concept is not only false and misleading, but concerningly irresponsible as it lacks any understanding of how gas procurement actually works. Our gas distribution business is carefully regulated and the gas supply we purchase for our customers is a strict pass through cost – meaning we don’t benefit from higher prices derived from withholding. This is well understood in the industry and is further evidence that the report is not credible. We do not engage in any behavior to ‘artificially constrain capacity.’ Our focus and actions are driven by our responsibility to ensure our customers have enough gas – we can’t run the risk that they are left in the cold," wrote Eversource spokesperson Tricia Taskey Modifica in an email to NBC Connecticut.

    AVANGRID also responded, writing, in part.

    "Our gas distribution companies are obligated to provide reliable natural gas service to all residential customers and others who have contracted for guaranteed “firm” service. We reserve pipeline capacity to help protect customers from interruptions —including during unpredictable, extreme weather conditions. In Connecticut, we are required to serve as the “supplier of last resort” for retail, commercial and industrial natural gas customers interconnected to our gas distribution companies. We rigorously follow all applicable laws and regulations in fulfillment of our overriding obligation to provide reliable service to our customers."

    The Northeast Gas Association also responded to the report, calling it misleading and inaccurate. To read their full response, click here.

    The investigation is underway.

    "These are serious allegations that need to be thoroughly investigated, and I am appreciative that PURA responded promptly by opening this investigation. We actively track the natural gas market and work with fellow state agencies, our utility companies, and other stakeholders to ensure that energy markets work in a fair and transparent manner. While we are generally confident that our markets function as intended, claims of this magnitude must be thoroughly investigated to ensure consumer confidence in the bills they pay," wrote Consumer Counsel Elin Swanson Katz.