In order to get Connecticut regulators to sign off on its proposed $3 billion merger to Spanish energy giant Iberdrola sometime this year, New Haven utility parent UIL Holdings offered $68 million in benefits to Connecticut, as well as increasing local hiring.
The highlight of the benefit package is a proposed $20 million rate credit to UIL’s electric and natural gas customers in Connecticut, which could be paid all at once or over several years. The company also proposed putting on a rate freeze until 2018 for its Southern Connecticut Gas and Connecticut Natural Gas customers.
The American division Iberdrola and UIL proposed the merger back in February, but the Connecticut Public Utilities Regulatory Authority in June said it planned on denying the application because regulators did not see what the direct benefit to consumers would be. Rather than receive the official denial, Iberdrola and UIL withdrew that application and started the process over from scratch to include specific benefits to consumers.
In addition to the $20 million rate credit, UIL plans on cleaning up the English Station power plant in New Haven that the company sold in 2000 but has yet to clean up contaminants at the site. The firm is negotiating with the Department of Energy & Environmental Protection and the Connecticut attorney general on what the clean-up would entail, but UIL estimates it will cost $30 million.
UIL also is offering $6 million to the Connecticut Clean Energy Fund, which offers subsidies for energy efficiency projects, and $1 million for a disaster relief fund. The company is proposing to accelerate the cast iron and bare steel replacement of its Southern Connectictu Gas distribution system, which would double the cost from $11 million to $22 million.
Lastly, the company proposed to appoint a president of Connecticut operations to ensure decisions were still made locally, as well as hiring 150 employees or contractors to do various projects, particularly electric transmission.
