Connecticut Attorney General William Tong has escalated his opposition to the proposed sale of Aquarion Water Company, urging the state’s Public Utility Regulatory Authority (PURA) to reject the transaction that would convert the utility into a nonprofit entity. In a letter to PURA, Tong argued that the sale would lead to significant rate increases, reduce consumer protections, and eliminate public oversight over water rates, ultimately harming Aquarion’s customers.
The Aquarion Water Company serves approximately 722,000 people across 62 municipalities in Connecticut, including parts of Stonington. The proposed sale would transfer ownership from Eversource to a new nonprofit entity, the Aquarion Water Authority (AWA), which would share resources with the South Central Regional Water Authority (RWA). However, this shift would remove PURA’s regulatory oversight, replacing it with a board of town representatives who would have to accept or reject rate requests in their entirety.
Tong’s letter emphasized that the record in the case has not changed since PURA initially denied the transaction on November 19, 2023. Despite this, PURA reversed its decision last Friday, preliminarily approving the sale. “The record in this case has not changed since the matter was remanded back to PURA,” Tong stated. “Yet, for reasons that are unclear, PURA has retreated from its initial decision — now approving the very same application that it recently rejected for lack of managerial suitability in a manner consistent with the public interest — to the profound detriment of every Aquarion customer for years to come.”
The attorney general highlighted the significant financial burden the sale would place on ratepayers. The proposed transaction would require Aquarion ratepayers to pay $5.895 billion in acquisition costs financed over forty years. Tong asserted that these massive rate increases alone are sufficient grounds to reject the application. “If approved, the proposed transaction will require Aquarion ratepayers to pay $5.895 billion in acquisition costs financed out over forty years,” Tong said. “The PURA does not dispute the amount of these acquisition costs or that they will be borne by ratepayers.”
Additionally, Tong pointed out that Aquarion has failed to demonstrate necessary managerial suitability, particularly due to insufficiencies in the structure of the Office of Consumer Affairs. This office, lacking independence and resources, would be unable to effectively protect customers, providing another reason for PURA to reject the transaction.
The proposed sale has raised concerns about the future of water rate regulation in Connecticut. Nonprofit utilities like the RWA and AWA are governed by their own boards, which lack the ability to make line-item adjustments to rate requests. This shift could lead to higher rates and reduced consumer protections, as the board must accept or reject rate requests in their entirety.
Tong urged PURA to hold oral arguments on the matter and ultimately reject the transaction. The outcome of this case could set a precedent for how water utilities are regulated in Connecticut, potentially impacting the affordability and quality of water services for hundreds of thousands of residents.