Connecticut Mulls Tax On Electricity Generators

By Stephen Singer

Associated Press

HARTFORD (AP) — A committee of the Connecticut legislature narrowly approved Tuesday a proposed tax on generators of electricity to provide relief for ratepayers, finance alternative energy systems, and raise revenue.

The legislature’s Energy and Technology Committee voted 12-9 to approve the bill, which now heads to the Finance Committee. It would impose a tax on generators that use oil, coal, and nuclear power. The tax would raise $340 million in revenue, with $332 million from Connecticut’s Millstone nuclear plants.

Dominion Resources Inc, which operates the plants in southeastern Connecticut, said the tax will raise prices for consumers and that it is discriminatory.

Daniel Weekley, vice president of government affairs for the Richmond, Va.-based Dominion, told the committee last week its proposal is a “punitive energy tax” that would force it to raise prices. It also undermines business as Governor Dannel P. Malloy insists his administration is pro-business, he said.

“Dominion will be required to pay more than $300 million in additional taxes — not exactly what Gov Malloy intended when he called upon businesses to share in the pain,” Weekley said.

Weekley and other opponents say the legislation, which bars taxes on electricity generated in Connecticut exclusively through fuel cells or an alternative energy, discriminates against nuclear, oil, and coal.

Representative Vickie Nardello, co-chairwoman of the Energy and Technology Committee, said the Millstone plants have benefited from low costs and can bear the proposed tax more than other generators. “Where is the fairness here?” she asked.

Representative Laura Hoydick, R-Stratford, the ranking House Republican on the energy committee, said higher taxes on the generators will lead to higher rates.

Consumer and environmental advocates support the measure. Christopher Phelps, program director at Environment Connecticut, told lawmakers at a public hearing last week that the revenue will support spending for renewable energy and energy efficiency and would repeal a tax established last year.

However, the New England Power Generators Association said that because no other state in New England imposes a tax on generators of electricity, such a tax would make Connecticut less competitive in attracting business.