The attorney generals of Massachusetts and Rhode Island on Thursday warned Connecticut against extending the tax on electricity generation, saying the measure unnecessarily burdens all New England ratepayers.
Massachusetts Attorney General Martha Coakley and Rhode Island Attorney General Peter Kilmartin wrote leaders of this state’s General Assembly, saying Connecticut’s power taxes cost New England ratepayers some $58 million extra annually for their electricity, with three-quarters of that extra burden borne outside Connecticut.
“Our offices work every day to oppose unnecessary and inappropriate electricity rate increases to protect the ratepayers of our states,” Coakley and Kilmartin wrote. “As our commercial and industrial ratepayers attempt to compete with other businesses across the country and the world, high electricity costs hurt their ability to keep jobs and bring new jobs to the region.”
Connecticut’s power-generation tax imposes a $2.50 surcharge on power plants for every megawatt produced. Since implemented in 2011, the tax has raised $70 million for state coffers.
The measure is due to expire in July, but Gov. Dannel P. Malloy proposed extending the tax for another two years in his $43.8 billion budget revealed on Wednesday.
“While we respect the opinions of our neighboring attorneys general, we have to take the appropriate action for our state,” Malloy spokesman Andrew Doba said. “The fact is that energy rates are down 12 percent across the board in Connecticut since the enactment of this revenue enhancement. And we look forward to further reductions in rates once the governor’s comprehensive energy strategy is fully implemented.”
Coakley opposed the tax when it was first proposed in 2011, going as far as investigating whether the measure wrongly imposed charges on Massachusetts ratepayers. Her efforts did not lead to a significant dispute because, in part, the tax was due to sunset this year.
“We urge you to not reauthorize this tax,” Coakley and Kilmartin wrote.
