I-Team: Eversource and UI executive salaries; utility watchdog weighs in
ROCKY HILL, CT (WFSB) - As Eversource and UI customers learn to penny pitch, many of you have asked us about executive salaries.
In 2021, the CEO of Eversource, Joseph Nolan, earned $4.7 million dollars. Earning a base salary of $1,000,424, he received an additional $1.4 million from stock awards and $2.25 in incentive earnings.
United Illuminating’s CEO (the parent company’s name is Avangrid), Dennis Arriola, earned $1.8 million in 2021. His salary was $465,385, with a bonus of $300,000, a non-equity incentive plan compensation of $278,894 and other compensation coming in at $735,050.
“This is not really par for the course,” says Itai Vardi, with the Energy and Policy Institute, a utility watchdog group.
He says Eversource is “at the top of their league” when it comes to executive salaries.
“It’s high. We did a study on utility exec compensation between 2017-2019 and we found that Eversource was in the top 3 exec earners, specifically the CEO,” says Vardi.
Now it’s important to understand, the salaries aren’t responsible for the rate hikes.
The main reason is, Connecticut is extremely reliant on fossil fuels, as generators of electricity.
The prices on fossil fuels, particularly natural gas, have increased dramatically over the past year.
“It was a bad bet to put a lot of the investment in this now we see very volatile fossil fuel,” says Vardi.
Vardi says lowering executive salaries wouldn’t lower your bill, but if that money was diverted instead to sharing fuel costs, that could eventually trickle down to the customer.
“Utility regulators and state lawmakers have to force the utilities to share much more of the cost,” says Vardi.
Mitchell Gross, a spokesperson for Eversource in our region, says, “Our compensation strategy is performance-driven and market-based, and we use an independent, third-party compensation firm to help shape our compensation packages to ensure that they are in line with the market. Executive packages are a combination of base salary, annual cash incentive awards and long-term, equity-based incentives. Because operational success is critical to ensuring that we keep the costs we can control as low as possible for our customers, those incentives are tied to performance. As a reminder, higher electric bills this winter will be due to the supply cost which is based on market conditions that we do not control. We purchase power on behalf of our customers and only charge them what we pay generators for producing the power – we do not earn a profit on the cost of electricity.”
A spokesperson for UI says, “UI does not profit from the cost of electricity and ‘executive salaries are not related.’”
The spokesperson goes on to say, United Illuminating wholeheartedly agrees on the need to come to the table to identify solutions for our customers and residents across Connecticut. UI also believes the energy generation companies, including Vitol, NextEra, and Constellation, which profit from these prices on the competitive market and generated revenue in excess of $342 billion in 2021, must come to the table and provide relief to customers across Connecticut.
The Standard Service price is the cost of energy used by ratepayers and purchased by UI on their behalf without any markup or profit. Energy prices across the globe have increased, especially natural gas – the primary fuel in New England – due to supply chain constraints, high inflation, and the ongoing conflict in Ukraine. UI serves as a pass-through mechanism for the recovery of these costs and does not profit from them in in any way.
UI understands that the unprecedented state of the global energy market, and the prices determined by energy generators on the competitive market, are having real, burdensome impacts on the everyday lives of families across Connecticut. UI is committed to making sure our customers are aware of, and prepared for, these rising supply costs and understand the programs we have to help.
To help customers manage increase supply costs, UI is reminding those having difficulty paying their bill of the following programs the company offers to provide assistance and relief:
- Matching Payment Program – Residential customers covered by the Winter Protection Program and who heat by electricity may qualify for UI’s Matching Payment Program. If you qualify, we will work with you to develop a monthly budget agreement. If you keep that agreement, we will match your payments to reduce your back balance.
- Bill Forgiveness Program – This program helps low-income customers maintain year-round service and pay down delinquent balances by company-matched dollars. A payment arrangement plan helps qualified hardship customers pay past-due electric bills. Under BFP, if payments are current, a past-due balance can be “forgiven” over time.
- Winter Protection Program – UI offers winter protection to all our customers that qualify. If you meet eligibility requirements, we will not turn off your electricity between November 1 and May 1. The Winter Protection Plan must be renewed annually, beginning in October. To prevent your service from being shut off after May 1, contact UI to set up a payment arrangement.
- Flexible Payment Arrangements – UI will work with customers if they are having trouble paying their electric bill. UI offers flexible payment arrangements for all customers needing assistance. These arrangements can be spread out up to 18 months for residential customers and 6 months for non-residential customers. Current payment arrangements may be renegotiated due to a change in financial circumstances Per Conn. Agencies Reg. § 16-3-100(b)(3)(A). These arrangements may be discussed confidentially by calling our Customer Care Center at 800.722.5584.
- Called to Active Duty? – Customers may qualify for temporary suspension of collections action and disconnection of their electric service if they are called into active duty in the U.S. military.
- Home Energy Solutions-Income Eligible (HES-IE) – Through the Connecticut Energy Efficiency Fund, United Illuminating administers the HES-IE program. This weatherization program is designed to help customers with limited income or financial needs reduce their energy bills.
For more information on financial assistance programs offered by UI, please visit the UI website or call (800) 722-5584. For more information on Home Energy Solutions visit the UI website or call (877) 947-3873.
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