The Public Utilities Regulatory Authority (PURA) in 2023 prevented Wattifi, an energy company partly owned by Hartford State Senator John Fonfara, from relinquishing its license for more than a year after the company had already ceased operations, allowing penalties to rack up to over $1.1 million, according to a review of docket materials.

Wattifi had attempted to relinquish its license in the months leading up to a PURA decision in 2023 that required Wattifi to pay roughly $57,000 to Eversource and United Illuminating for billing technology upgrades. PURA then began to level penalties against Wattifi for nonpayment, even though the company had no customers and had filed for dissolution with the Secretary of State’s Office months earlier.

According to reports, Fonfara, who helmed the General Assembly’s Energy and Technology Committee for a number of years, is set to fill a vacant position in PURA following a backroom deal struck between legislative leaders and Gov. Ned Lamont to get embattled PURA Chairman Marissa Gillett through the nominations process, which included Fonfara’s vote. 

It was later revealed that Fonfara’s former company is on the hook for more than $1 million in PURA penalties through a complicated process riddled with motion rulings made with only the executive secretary’s signature and some delegations of authority – issues that have been raised by Connecticut’s major utilities in a court action against PURA, who allege that Gillett, alone, is ruling on motions under the guise of the full Authority.

In 2021, PURA opened a docket to determine the cost allocations of each third-party energy supplier to support the utilities’ billing technology upgrades but delegated that authority to the Office of Education, Outreach, and Enforcement (EOE) to develop the proposed decision under a motion signed only by the executive secretary.

The unusual move to saddle the EOE with crafting the proposed decision referenced state statute that says PURA may “require a portion of the staff of the authority to be made a party to any proceeding,” but says nothing about delegating PURA’s authority, and there is no recorded hearing or vote on the matter.

Nevertheless, EOE developed a proposed draft decision in August of 2022, which said, “All Suppliers who currently have a residential license have the statutorily-obliged opportunity to use the EDC billing system; therefore, it is reasonable to require all of these suppliers to pay a portion of the Final Project Costs.” The draft sat untouched for nearly a year until July 2023, when PURA issued its proposed final decision.

That decision made a key change to the language: “Any third-party electric supplier that is currently licensed to serve residential customers or served residential customers as of August 12, 2021, is responsible for the costs resulting from the Implementation Decision. Conversely, any third-party electric supplier that is not currently licensed to serve residential customers or did not serve residential customers as of August 12, 2021, is not responsible for the costs resulting from the Decision.” 

An appendix of the draft decision showed a list of all third-party suppliers and their license status, including Wattifi, which is listed as having a “active” license. Wattifi, however, had sought to relinquish its license months prior to the proposed decision. 

In a March 27, 2023, letter to PURA, Wattifi co-owner Erik J. Bartone wrote the company would exit the Connecticut market by April 30 and all customers had been notified. The EOE responded the following day that Wattifi had to fulfill certain “obligations,” whereupon “the Authority will then relinquish Wattifi’s electric supplier license.”

“The last two years have been extremely challenging for electricity providers in Connecticut and New England. Many of the reasons relate to the higher costs of natural gas and crude oil as a result of the Russia-Ukraine conflict. However, Connecticut and New England can expect to see continued upward pressure on electric generation prices for the foreseeable future as a result of the commitment to reduce the amount of carbon in the New England electricity generation fuel mix,” Wattifi wrote to customers in a February 2023 letter. “Given these changing market and regulatory conditions, we unfortunately do not see a clear path to more predictable electricity generation rates in the near to mid-term future.”

Wattifi confirmed they fulfilled their obligations by July of 2023, remitting a combined $32,516 to Eversource, United Illuminating, the CT Green Bank, and the Department of Energy and Environmental Protection.

In a July 13, 2023, letter to PURA, the EOE indicates that Wattifi has “taken all the necessary measures to relinquish its electric supplier license,” while also noting that Wattifi was one of the listed third-party suppliers who would owe money under the proposed final decision. PURA did not accept Wattifi’s relinquishment, however, and nearly two weeks later issued its final decision, putting Wattifi on the hook for the $57,000.

Between Wattifi’s request to relinquish its license in March and the proposed final decision in June, Senate Bill 7, a massive energy bill that would have allowed Chairman Gillett to appoint a single commissioner to oversee dockets and render decisions as opposed to a panel of commissioners, came before the Senate and Fonfara was critical of the language.

Fonfara argued it placed too much authority into a single person and questioned Sen. Norm Needleman, D-Essex, over whether the PURA chairman, under this bill, could presumably appoint themselves to decide all matters before PURA.

“I think this is, whether it’s not well written or otherwise, it’s a dangerous road to go down that again, no law should be written for a personality or for a person,” Fonfara said in his closing remarks on May 25, 2023. “But to allow these kinds of decisions to be taken by a single person I think is not in the best interest of Connecticut ratepayers, not in the interest of our state. And in that regard, I would hope that as this bill travels, that there’s recognition of the potential abuse of that language and how it could be harmful to our ratepayers, harmful to our state.”

Despite his criticism, Senate Bill 7 passed with Fonfara voting in favor of it, but the PURA language was stripped out in the budget implementer passed in June, leaving the state statute intact.

Although only 13 days elapsed between EOE’s confirmation that Wattifi had fulfilled its obligations and PURA’s final decision, other companies seeking to relinquish their license have had motions granted more quickly. 

Only one day elapsed between EOE confirming that HIKO Energy, LLC had fulfilled its obligations, and PURA granting the motion to relinquish its license; Perigree Energy, LLC had their motion approved the next day, MPower Energy, LLC, was granted its motion to relinquish its license within 13 days — all companies listed under PURA’s final decision.

PURA denied Wattifi’s motion to relinquish its license on the same day Wattifi filed for dissolution with the Secretary of State’s office on September 13, 2023. Three months later, PURA began to penalize Wattifi $5,000 per day for not paying Eversource and UI the $57,000.  

PURA, however, never granted Wattifi relinquishment. Instead, PURA revoked their license on May 29, the following year. Wattifi’s revocation was the only action taken against Wattifi that had been discussed in a public hearing and signed by any commissioners, and the decision makes no mention of Wattifi’s attempts to relinquish its license. 

By the time PURA revoked Wattifi’s license, penalties amounted to $1.1 million to be paid to Operation Fuel, which helps low-income residents pay for energy costs.

According to the Hartford Courant, the Lamont administration and legislative leaders reached a deal to get Gillett through the nominations process. PURA would reportedly be moved from the Department of Energy and Environmental Protections to become its own quasi-public entity and two more commissioners would be appointed to fill out the Authority.

PURA would have to become a quasi-public in order for Fonfara, who is a sitting state senator, to occupy a seat on the Authority, and questions are being raised regarding Fonfara’s potential conflicts of interest – not just for his ties to Wattifi and the $1 million in penalties, but also for other energy companies tied to the senator. A PURA commissioner job comes with a salary ranging from $150,000 to more than $200,000.

Gillett’s nomination was confirmed by the Nominations Committee, including Fonfara’s vote, on February 21, after a grueling seven-hour hearing. Gillett denied any knowledge of the deal during the hearing.

Republicans largely opposed the nomination vote, criticizing the deal to get Gillett across the finish line, even though that deal will give them PURA reforms they’ve pushed for: getting PURA out from under DEEP, getting a full five commissioners per state statute, and purportedly the potential placement of former state representative Holly Cheeseman to the Authority. 

“Frankly, in my 10 years in legislature, there’s few days where I’ve been angrier or more upset about the process and how we ultimately got here today, and how things were negotiated in dark rooms,” said Sen. Stephen Harding (R-Brookfield). “What was done in the dark of night, in the 11th hour, to get certain people to vote yesterday, presumably, is one of the worst things I’ve seen in politics in this building.”

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