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Connecticut bans utilities from charging for lobbying costs

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(The Center Square) — Connecticut has joined a handful of states banning utilities from passing on the costs of lobbying the state government to energy consumers.

A new law, tucked into a package of bills signed by Gov. Ned Lamont last week, will prevent large investor-owned utilities from recovering the costs associated with lobbying, as well as legal fees, memberships, dues or contributions to a business or industry trade associations or groups, among other changes.

Supporters of the changes point to recent data showing that Connecticut utilities spend more on lobbying state officials, lawmakers and regulators than any other industry, often in opposition of climate change policies.

“Utility lobbyists frequently lobby against bills that are in the public interest, notably those pertaining to clean energy and climate change,” the Conservation Law Foundation said in testimony supporting the bill. “Companies should not be able to recover any of their lobbying costs from ratepayers.”

Connecticut has some of the nation’s highest energy costs, and regulators are pushing utilities to reduce charges for gas, electricity and water.

A 2021 report by the Institute at Brown for Environment and Society found that Connecticut’s largest utility, Eversource, poured more than $305,000 into lobbying efforts in the first quarter of 2023, the third-largest amount for that period, the report noted.

A majority of the lobbying expenditures by the state’s electric and gas companies were devoted to opposing state policies on climate change, according to the report.

By approving the law, Connecticut joins two other states — Maine and Colorado — that have taken steps to reduce energy consumers’ costs by blocking the recovery of money from lobbying and professional memberships.

Federal and state regulations already bar utilities from recovering money from energy consumers to fund political operations, but observers say those laws are riddled with loopholes that allow the companies to get around the restrictions.

Connecticut’s utility companies, which opposed many provisions of the bill, had argued that they don’t pass on the costs of lobbying in the form of higher rates for energy consumers and criticized a provision preventing them from recovering funds for memberships in business and trade associations.

In testimony opposing the bill, Kenna Hagan, vice president and general counsel for Avangrid’s UIL Holdings Corporation, said memberships provide “access to research and development information and best practices across the industry to improve reliability, contribute best practices in project management and operational efficiencies” among other benefits.

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