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Lawsuit claims Eversource manipulated energy prices

By MICHAEL COUSINEAU
New Hampshire Union Leader

November 18. 2017 11:30PM


Energy companies Eversource Energy and Avangrid Inc. caused New England electric customers to get overcharged by $3.6 billion using an “anti-competitive scheme” to manipulate energy prices, according to a lawsuit filed in federal court.

They “unlawfully abused their substantial market power to manipulate both natural gas and electricity prices in the six-station region over a period of time spanning at least from 2013 to 2016,” read the 61-page lawsuit filed last week in Boston.

Their conduct raised electricity prices by at least 20 percent during that period for those living in the six New England states, according to court papers.

New Hampshire residents use about 10 percent of New England’s power supply.

“We are aware of the lawsuit and are reviewing it,” Eversource spokesman Martin Murray said Friday. “However, the facts remain unchanged. The allegations underlying this lawsuit are untrue and baseless. The expenditure of resources to further these false claims is regrettable for all parties involved.”

Eversource served about 513,000 homes and businesses in New Hampshire as of June 30.

Avangrid, through a subsidiary, owns electricity generating facilities in multiple states, including New Hampshire, according to the lawsuit. The company says it operates New Hampshire wind farms in Groton and Lempster.

“The company is reviewing the allegations in the complaint and will vigorously defend against these claims,” said Michael West Jr., Avangrid’s vice president of corporate communication. “In providing service to customers, Avangrid seeks to comply with all state and federal regulatory requirements.”

The lawsuit alleges that the defendants regularly reserved more pipeline capacity than they knew they needed, planning to cancel their reservation at the last minute when it was too late for other market participants to use the newly created capacity to meet unfilled natural gas demand.

“Reduced natural gas supply, caused solely by the defendants’ last-minute downward order adjustments, regulated in spot market natural gas prices that were 38% higher than they would otherwise have been on average,” the lawsuit stated. “During the cold winter months, defendants’ conduct resulted in spot market natural gas prices that were nearly 70% higher than they otherwise would have been.”

Consumer advocate Donald Kreis, whose office works on behalf of New Hampshire utility ratepayers, said there should be an investigation into allegations contained in a report released last month by the Environmental Defense Fund that Kreis believes was used in the lawsuit to illustrate the alleged overcharging.

“It is quite a leap to allege that there was an Enron-style conspiracy here to manipulate the natural gas capacity in a way that was designed to have pernicious effects in the wholesale electricity market,” Kreis said.

Any “ill-gotten gains” derived from Eversource’s power-generating facilities in New Hampshire would have been returned to customers, reducing some of the alleged overcharging of Eversource’s Granite State customers, Kreis said.

The lawsuit, filed by Hagens Berman, a national class-action law firm, alleges the defendants broke federal and state laws. It names 11 plaintiffs, including Bradford Keith of Lyme, who purchased power from Eversource.

mcousineau@unionleader.com


Courts Energy Manchester


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