NSTAR seeks to recover $38 million for storm response cost

The total consists of about $23.3 million in costs to restore service after the tropical storm and about $14.8 million in costs to restore service after the snowstorm

Apr 5th, 2013

Massachusetts state regulators will hold a public hearing April 18 regarding an NSTAR Electric Co. petition to recover about $38.1 million that the company spent in restoring electric service to customers following Tropical Storm Irene in 2011, as well as an October 2011 snowstorm.

That total consists of about $23.3 million in costs to restore service after the tropical storm and about $14.8 million in costs to restore service after the snowstorm, according to the state Department of Public Utilities (DPU) March 27 notice.

The company seeks to recover the costs over a five-year period starting on Jan. 1, 2014, through a storm cost recovery adjustment factor.

According to NSTAR Electric, its proposed cost recovery is consistent with a settlement approved by the DPU in the NSTAR Electric/Northeast Utilities merger proceeding, through which NSTAR Electric was authorized to, subject to DPU investigation, recover over a five-year period starting on Jan. 1, 2014, deferred costs associated with restoring electric service to customers following the storms with interest set at the prime rate.

The DPU also said that the state attorney general filed a notice to intervene in the matter.

According to the company's March 1 filing in the proceeding, there are four categories of costs requested for recovery: charges from external contractors and other outside vendors; incremental storm-related payroll costs and payroll taxes directly correlated with the storm-related payroll costs; materials costs; and logistical charges.

There were no actions taken by NSTAR Electric that would justify disallowance of storm costs as the DPU's investigation regarding NSTAR Electric's efforts did not identify any failure of the company to implement its emergency response plan, which would have caused the length of the service interruptions or outages to be materially longer than would have otherwise been but for that failure — nor did any such failure actually occur.

The company also noted that in a previous decision, the DPU found certain alleged deficiencies in NSTAR Electric's performance in the storms, including NSTAR Electric's response time and municipal communications on priority wires down, and the company has appealed those findings.

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