Court rules against New England states in power grid suit

WASHINGTON, D.C. - An appeals court ruled that federal energy regulators have authority over key estimates used to determine electricity pricing in New England, rejecting the states' effort to gain more control of the region's power grid.

Judges on the U.S. Court of Appeals for the District of Columbia said the Federal Energy Regulatory Commission has the jurisdiction to approve and modify the yearly estimates of all six states' power needs for the ensuing three years.

The estimates, which are the basis for electricity pricing and affect how much consumers and utilities pay for power, are compiled by the operator of the region's power grid, ISO New England Inc.

They are then submitted to the federal commission for approval.

Energy regulators in the states have been disputing the projections, saying they are too high and have resulted in homeowners and businesses paying more than they should for their electricity.

"State officials acting in the public interest should determine the state's electricity needs, not unaccountable federal regulators controlled by Big Energy," Connecticut Attorney General Richard Blumenthal said.

ISO New England supports the court's ruling and considers it important for the efficient running of the power grid, company spokeswoman Ellen Foley said.

"If you were to allow the states to individually set and maintain their own requirements, it could create inconsistent results and lead to reliability problems," Foley said.

The states had gotten together and produced their own projections before ISO New England and the Federal Energy Regulatory Commission took the job over in 2005, following a ruling by the commission in 2003.

Connecticut regulators appealed the commission's decision and were joined by Massachusetts and Maine officials. Authorities in the three states said they were reviewing the court's ruling and deciding whether to take the case to the U.S. Supreme Court or Congress.

"We prefer the authority be local rather than in Washington," said Dennis Bergeron, a utility analyst for the Maine Public Utilities Commission.

Blumenthal said Connecticut has the highest electricity rates in the continental United States because of the current system. He says a state-controlled policy could save ratepayers in Connecticut $1 billion a year.