You don’t have to take my word for it. From the New York Times, discussing the second pathetic response by CL&P here in Connecticut to a storm and the resultant power outage:
There’s even a near-perfect model of how Connecticut Light and Power could have done the job better. Norwich, Conn., a city of 40,000, has owned its own electric utility, as well as those for sewage, gas and water, for 107 years. Norwich Public Utilities’ customers pay, on average, a bit less than Connecticut Light and Power’s. Yet after this past weekend’s snow dump, power was out for only about 450 of its 22,000 customers — and for no more than an hour. As of Thursday morning, nearly half a million Connecticut Light and Power customers were still waiting for the lights to go on.
That’s not luck, either. After Irene hit, just 13 percent of the city’s customers lost their power for more than a day. Within three days, the whole of Norwich had been restored. It took more than a week for Connecticut Light and Power to fully restore power.
That makes it seem odd that Gov. Dannel P. Malloy has tended to appear alongside Connecticut Light and Power’s Mr. Butler and to support the utility, even though far more customers lost power than should have and restoration proceeded too slowly. There’s solid numerical evidence to justify Mr. Malloy’s berating Connecticut Light and Power and calling for Mr. Butler’s head on behalf of the citizens of his state.
In contrast to Connecticut Light and Power, Norwich’s electric unit last year increased operations and maintenance spending by 11 percent, to $2.9 million. Put another way, in 2010 Norwich allocated about $132 a customer to this line item in its accounts. Connecticut Light and Power reported maintenance, unadjusted for deferred expenses, of $96.5 million, or around $78 per client.
It helps that the Norwich utilities are not slaves to the profit motive — though they hand 10 percent of gross revenue to the city. Last year, before paying this slice to the city, the electricity division made just a 3.6 percent operating profit margin on its $52.3 million of revenue. The Connecticut Light and Power division of Northeast, meanwhile, booked $3 billion of revenue last year and reported an operating margin nearly five times the size of Norwich’s. But it surely also helps that Norwich Public Utilities’ general manager, 12 linemen and five commissioners live in the community, drive the local roads, see the overhanging branches and bump into their customers at the Norwichtown Mall. That’s a rare kind of accountability.
Absent more help from the governor, the example of Norwich and similar municipally owned utilities in Groton and Wallingford, Connecticut communities fed up with the lights going out might consider emulating Boulder. Citizens of the Colorado college town this week voted to study a plan to buy back their local utility assets from a Minnesota-based mega-utility, Xcel Energy.
Unfortunately, not all of us in Groton enjoy the blessings of a publicly owned utility. Only the City of Groton gets electricity from Groton Utilities. We Town residents must make do with CL&P, though we are able to buy into Groton Utilities’ cable service in lieu of Comcast. I won’t start in on a rant about the Town/City dichotomy; that’s another subject and a case study in parochialism overcoming common sense.
There are several things that are signs that indicate that a particular service is better delivered by the state. Is it something that appears to be best done by a single source (the natural monopoly). Is it a service or product that is essential to life. That changes, of course, with the times, but nowadays I’d certainly include water, power, health care and internet in that classification. Is it something that requires very little innovation, considering the current state of the art. I wouldn’t want to let the government develop the operating system I use on my computer. We’d still be using the C prompt if that were the case. But there’s not really a whole lot of creativity necessary to run a utility company or a health insurance company. In fact, in the case of insurance, the less creativity the better. Better to stick with the actuarial tables and leave the derivatives, etc. to the gamblers on Wall Street. It’s also a fact that the very companies that deliver the goods and services better handled by the state are the least responsive to their customers.
One thing I should add. The comparison of CL&P in the recent storm, as opposed to Irene, is a bit unfair. I work in Norwich, and it got very little snow and therefore very little destruction. It would have been better for the Times to look at Wallingford’s performance in the recent storm. But the contrast for Irene was spot on, both for Norwich and Groton (City, not Town, alas). Each had almost 100% of its customers back on within a day.
Post a Comment