Several ratepayer funded pilot programs approved by the Public Utilities Regulatory Authority (PURA) have encountered delays “outside of their control,” and were approved for time extensions during PURA’s July 25 meeting to avoid an “unnecessary forfeiture of value to ratepayers,” according to motion decisions.
The pilot programs are part of PURA’s Innovative Energy Solutions program, a $20 million project embarked upon by PURA, purportedly authorized by legislation passed in 2007, that allows startup energy technology companies to test their projects in Connecticut in hopes of yielding greater efficiencies for ratepayers. The program is part of PURA’s equitable modern grid framework, which PURA launched in 2019.
PURA had previously approved 16 pilot programs offered by companies mostly based in other states and other countries. According to PURA’s meeting and docket submissions, however, three of the programs have encountered difficulties with municipalities, homeowners, the utility companies they are supposed to be working with, and subcontractors.
According to PURA documents, Tantalus, a Canadian-based energy technology company working with United Illuminating to reduce electricity demand and consumption through smart-grid flexibility, encountered “numerous obstacles from the City of Bridgeport, the electrical subcontractor hired to do the installations, United Illuminating (UI), and homeowners.”
In their correspondence, Tantalus indicated that the number of homeowners they initially canvassed who would allow their technology to be tested in their home was reduced due to local permitting issues, scheduling problems, tax liens, and the absence of necessary infrastructure in participants’ homes. This meant fewer participants and a projected cost reduction from nearly $1.3 million to $972,278.
GridEdge Networks, a U.K.-based company focused on using artificial intelligence to move commercial companies to “net zero” energy use, was delayed due to “customer concerns regarding changes to their solar tariffs and renewable energy credits,” and a V2G charger manufacturer exiting the market, according to the company.
The company indicated that if their extension was not approved, “We will lose significant learnings that can assist the state in addressing grid integration challenges of future electric school buses and EV fleets in general,” Nachum Sadan of GridEdge wrote.
Finally, Smarter Grid Solutions, a Scotland-based company, reported delays in accessing UI’s virtual environment, which was necessary to test their software, securing site participants, and working with a third party.
The program administrator determined the delays were not the fault of the companies, and that time extension approval by PURA will result in better data to determine if the new technology will be applicable at scale and offer energy efficiencies. The three PURA commissioners approved the extensions, although the motion’s decision indicated that Smarter Grid Solutions was far behind schedule and there was “cause for concern.”
“The Authority finds it reasonable and appropriate to approve the changes to the SFAs proposed by Tantalus, GridEdge, and SGS. Consequently, the Authority approves the modifications to the SFAs requested in the Motions,” the PURA interim decision said.
The IES program creates what is often called a “regulatory sandbox,” which allows companies to test technologies in “controlled environments” without having to navigate the red tape that usually comes with trying to navigate complex, bureaucratic systems.
Several of the technologies to be tested involve electric vehicle charging, smart-metering, and artificial intelligence in the hopes that these technologies can be developed at a large scale and implemented through Connecticut’s major electric utility companies to save ratepayers money. However, the cost of the program is borne by ratepayers through the Public Benefits Charge on their electric bill, which covers the cost for United Illuminating and Eversource to implement state mandates and has reached an overall cost of roughly $1 billion per year.
After vigorous political debate throughout the 2025 session, lawmakers eventually reached an agreement to move roughly $155 million in public benefits charges to state bonding, which will reduce the charges by roughly $4 for the average household. General Assembly Republicans were pushing to eliminate the Public Benefits charge completely.
Connecticut has some of the highest electricity rates in the country due to both the public benefits charges and the state’s limited ability to bring in fuel from other states, which continue to plague state politics and impact the state’s cost of living and cost of doing business. Sen. Richard Blumenthal, D-CT, also decried the escalating cost of electric transmission, noting that the cost of transmission projects is expected to rise from $1.2 billion to more than $6 billion.
PURA’s IES program hopes to be able to offer efficiencies through new technology in the future, but even if successful, implementation will likely be far off in the future.
“As this is the first cycle of the IES Program, some limited project refinement may be expected to improve the likelihood of project success,” the PURA commissioners wrote. “However, project innovators, such as Tantalus, GridEdge, and SGS, and their partner EDCs, are expected to conduct sufficient due diligence on the proposed pilot projects to reduce or eliminate potentially avoidable SFA modifications wherever possible.”
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Wow, that Public Benefits charge is turning into quite the slush fund. Quite frankly, I just want to pay a fair price for the electricity my household consumes. That’s it.
Marc,
These programs are noise compared to the grid cost of electrification (heat pumps HP and EVs). Why not write about the ISO EPCET study which concludes that it “involves significant cost and unresolved reliability concerns”? What could go wrong serving a weather dependent heating spiked load with a weather dependent wind and solar system? By 2050 the netzero heating will drive the winter peak from the present 20GW to 40 GW in warm winters and 60 GW in cold winters. Much generation will go bankrupt as it only runs a few hours every 3 years. All explained in the epcet report.
Also look at the slides that accompany it for the non electrification scenario for 2050 and the October 2023 slides for 2032. They show costs disproportionately doubling by 2032 for only adding 5.5% heating load and 10 % EV load. Reason: burning 435% more oil which also increases CO2 emissions 67%.
As a result of the bankruptcy issue the base scenario now includes 8000MW of nukes added after 2040. But there is a problem: the nukes only run 22% of the time. The intermittent offshore wind installed in the 2030s screws up the nuke economics like the solar interrupts the gas today.
Most of the above issues could be avoided by not electrifying with hp and evs. 90% of the offshore wind and 50% of the batteries would not be needed without HP/EV.
By 2032 non HP/EV load will pay $3B per year more to subsidize the electric costs for HP/EV customers.
Based on our two years direct experience with the CT IES program (two of our proposals were accepted in Phase 1), the findings that several of the companies are behind schedule comes as no surprise. We would also not be surprised if this is merely the tip of the iceberg as PURA’s administration of this program is a muddled mess.
Here are some concrete examples:
1) While the goals of the IES program were laudable in that they purport to help build a Connecticut ecosystem of innovation and new businesses along with energy savings and emissions reductions, the article points out that most of the companies participating in the IES program are from outside the state- and several are outside the US. The focus on out of state companies over Connecticut companies illustrates the inability of PURA to work with local communities. It also shows the complete disregard the administrators of the program had for following the legislation that established the program. One of the key points of the legislation to encourage Connecticut entrepreneurs to participate was through the proviso that established firms in the utility industry, would be excluded as these companies could sell their products without the program. Yet entrepreneurs found themselves competing against firms with hundreds of employees and market capitalizations in the billions.
2). PURA was incapable of administering the program or evaluating the applications. Instead, administration of the program was outsourced to Stratagen, a California based energy consulting firm. Evaluation of the proposals was by the CT Innovation Advisory Council, although in practice, the utilities had the final say. While UI was making an effort to be helpful to entrepreneurs, at the end of the day, putting the utilities in charge of the final decisions on the proposals defeated the whole purpose of the program, i.e. to drive innovation by going to entrepreneurs outside the utility industry. Consequently, it seems highly unlikely that any IES program will bring measurable cost savings to ratepayers.
3). The timelines of the program are far too short to address major change, and PURA has no infrastructure to scale any successes to positively impact rates.
4). There was a lack of technical/scientific expertise in the program. Obvious flaws in proposals that should have lead to their exclusion were not spotted, while questions to the administrators of the program were directed to lawyers- which of course made the entire process cumbersome and unhelpful. It seemed that most of the people we met with from state agencies were lawyers.
5). While PURA was interested in leveraging federal funds, they provided no assistance to do so.
In summary, there has been public outcry that the lack of accountability in the public benefits charge program leads to waste. Unfortunately, the CT IES program may be a very good example.
Samuel Brauer, Ph.D.
Charles Brumlik, Ph.D., J.D.