Connecticut’s largest water utility is challenging nearly $908,000 in state regulatory fees, arguing its customers shouldn’t have to pay for oversight it no longer receives.
Aquarion came under public ownership June 30, ending the Public Utilities Regulatory Authority’s oversight of its two Connecticut water companies. But the state has billed those companies for regulatory costs for the fiscal year that began July 1.
The dispute centers on how that annual fee works. State officials say the money is owed because the charge is based on revenue the companies earned while they were still regulated. Aquarion argues that past revenue determines only the size of the bill — and that it owes nothing for a year when it is no longer subject to PURA oversight.
The utility’s new owner, the Aquarion Water Authority (AWA), asked PURA on Sept. 15 to cancel roughly $701,000 in unpaid charges and refund $206,527 already paid.
AWA, a public entity created by the legislature, owns Aquarion Water Co. of Connecticut and Torrington Water Co. Its rates are now set by a Representative Policy Board of appointees from the municipalities it serves, and it shares a CEO, CFO and board of directors with the South Central Connecticut Regional Water Authority.
Both companies made their first quarterly payments in May, while the ownership change was pending.
The annual assessment helps fund PURA and other state utility oversight. It is calculated using utilities’ revenue from the previous year.
The bills come from the state Department of Energy and Environmental Protection, which handles billing for PURA because the regulator remains part of the department for administrative purposes. The decision to keep charging Aquarion came from PURA’s legal office, a department spokesperson said.
In an email submitted with the filing, a DEEP fiscal supervisor told Aquarion the charges remain due because the companies generated the revenue in 2025, when they were still subject to state regulation.
“The assessment is not an advance charge for the upcoming fiscal year, but a statutory fee based on revenue collected during the reporting year,” the Sept. 9 email said.
Aquarion’s lawyers argue that the companies’ regulatory status during the fiscal year being billed should determine whether they must pay.
“PURA will expend no resources overseeing these entities during Fiscal Year 2027 and AWA’s ratepayers will receive no meaningful benefit from PURA’s services,” attorney Daniel R. Canavan of Harris Beach Murtha Cullina wrote in the petition.
Aquarion said the charges would ultimately fall on customers who are already paying for the new authority’s governance structure.
“AWA customers should not be required to bear costs associated with a regulatory framework that no longer applies in the fiscal year 2027,” said Peter Fazekas, the authority’s director of corporate communications.
PURA has designated the request as a contested case, placing it in a formal proceeding to resolve the dispute. The regulator declined to comment, citing the pending case.
