Eversource Energy, Avangrid Price Fixing Lawsuit Investigation
If you live in Connecticut, Rhode Island, Massachusetts, Vermont, or New Hampshire, you may be one of the millions who allegedly overpaid for electricity.
What is This Lawsuit Investigation About?
In a recent report by university researchers for the Environmental Defense Fund, utility data analyzed from years 2013-2016 has shown “severe, simultaneous price spikes” in the New England wholesale natural gas and electricity markets. The 74-page report, “Vertical Market Power in Interconnected Natural Gas and Electricity Markets,” states, “while frequently attributed to limited pipeline capacity serving the region, we demonstrate that such price spikes have been exacerbated by some gas distribution firms scheduling deliveries without actually flowing gas. This behavior blocks other firms from utilizing pipeline capacity, which artificially limits gas supply to the region and drives up gas and electricity prices. We estimate that capacity withholding increased average gas and electricity prices by 38% and 20%, respectively, over the three-year period. As a result, customers paid $3.6 billion more for electricity.”
The study details a practice called “down-scheduling” whereby local utility companies scheduled more gas than necessary on a certain day, then canceled orders too late for the pipeline space to be resold. The practice “essentially locks up some pipeline capacity,” said Matthew Zaragoza-Watkins, Vanderbilt University professor and co-author of the report. “When you relate that back to gas-fired generators, that’s about 28% of the gas that would be demanded,” he said.
The report alleges that local utility companies run by Eversource and Avangrid, two of the region’s largest energy providers, intentionally created such shortages to raise gas prices for consumers.
Some subsidiaries include:
Connecticut Light and Power Company
Central Maine Power Company
Western Massachusetts Electric Company
NSTAR Electric Company
Public Service Company of New Hampshire
State Regulators Launch Investigation into Unique Monopoly, Market Abuse
Connecticut’s Public Utility Regulatory Authority has announced an investigation into the allegations of market abuse by Eversource and Avangrid.
Senator Blumenthal (D-CT) has also written the Federal Energy Regulatory, urging them to investigate the matter:
“While the motive remains unclear, I urge FERC to immediately investigate allegations of over withholding of natural gas by these companies in Connecticut,” he wrote. “[I]f it is found that market manipulation has occurred, FERC should expeditiously order a ban or other appropriate restriction on this practice and ensure that affected consumers are swiftly and fully compensated.”
Blumenthal also urged FERC to “examine any specific pricing policies” that could incentivize the behavior and “recommend policy changes that can be enacted to prevent this occurrence from continuing in the future.”
We are standing by 24/7, waiting to assist.
Milberg Tadler Phillips Grossman LLP is working with the law firm Sanders Phillips Grossman in evaluating the rights of consumers who may have been overcharged by Eversource, Avangrid, Inc., or a subsidiary.
It has been alleged that the companies “engaged in an anti-competitive scheme” to “reduce regional national gas capacity, particularly during cold weather, to drive up the cost of electricity for consumers,” – masslive.com
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