Central Maine Power Co. ratepayers will get a tiny reprieve in a settlement between the utility and the state over the costs of restoring power after several storms in 2022.

CMP had sought to recover a total of $127 million it says it spent on storm recovery. The company pared $850,000 from the request, a fraction of the $53 million Maine’s Public Advocate William Harwood wanted regulators to claw back after saying CMP overspent, failed to prove some expenses were justified, did not have contracts for most work crews and was not entitled to reimbursement from ratepayers.

Ron Francoeur, a lineman with Central Maine Power, works on lines in Kennebunkport after a utility pole snapped in half on Dec. 23, 2022. Gregory Rec/Staff Photographer, file

The state’s largest utility also agreed to change how it hires work crews and improve its administrative processes for staffing to justify its expenses.

The May 30 agreement has been submitted to the state Public Utilities Commission, which is scheduled to vote on it Tuesday.

The reduced recovery costs CMP agreed to will be reflected in its Jan. 1, 2025, price change. Most customers will see their monthly bills go up by less than $2 at that point, and the pared-back recovery costs may shave off a few cents.

By agreeing to reduce its request for storm recovery costs, CMP does not admit to any “imprudence” related to its work.

Prudence is a standard of review used to judge a utility’s performance and its decisions. If regulators rule that a utility acted prudently, it will be allowed to recover costs from ratepayers. If a utility acted imprudently, according to regulators, it will not be permitted to charge ratepayers and instead may have to tap its earnings, a response that’s generally met with shareholder resistance.

CMP agreed to file a revised 2024 emergency response plan that reflects “clarifications and enhancements” in how it documents preparations before storms and recovery afterward.

The PUC had permitted CMP to recover storm costs of about $117 million over two years beginning July 1, 2023, costing ratepayers $1 to $1.50 a month for two years. Harwood asked regulators to reduce that amount by $53.6 million.

“I’ll be the first to concede that $850,000 is a fairly small disallowance that will not have a larger, meaningful impact on ratepayers,” he said. “But I think the number is, not in its magnitude, but in its principle, important and will remind CMP, and for that matter all the other utilities when they make spending decisions, to think twice and make sure they are not engaging in excessive or imprudent spending.”

In a statement late Monday, CMP said the public advocate has no basis to claim it overspends to restore power following storms.

“Despite the surprising, disappointing and misleading statements from the (Office of the Public Advocate) on this important agreement, CMP stands ready to uphold its commitments and to work collaboratively on the reduction of storm costs with that office,” the utility said.

The agreement will allow the utility to continue hardening the state’s grid, CMP said, adding that it’s working with the public advocate to look at how storm-hardening grid projects could benefit Maine.

CHAMBER SUPPORTS CMP

Patrick Woodcock, president and chief executive officer of the Maine State Chamber of Commerce, which is a party to the case before the PUC, said the public advocate’s effort to cut millions of dollars from CMP’s reimbursement was not “overly productive.”

The more important point, he said, is that the agreement will help utilities and others identify storm costs through stronger staffing and reporting procedures, and promote a collaborative effort in hiring crews, spending and other decisions.

“Getting ahead of this is absolutely the way to go,” Woodcock said.

CMP agreed to put in place improved procedures related to contractors’ rate sheets, time sheets and other forms; perform storm invoice review and processing; and make other administrative changes intended to more clearly demonstrate how it spent money for storm recovery and why ratepayers should be asked to foot the bill.

“When you’re talking about collecting over $100 million from ratepayers for these storms, those kinds of basic practices should definitely be implemented,” said Brian Marshall, senior counsel at the Office of the Public Advocate.

If the impact of a storm is different than CMP predicted, the utility will adjust its emergency response plan and reevaluate and adjust resources, according to the agreement. Beginning Jan. 1, the utility will outline the basis for a change in operations with supporting documents in post-storm assessments filed with the PUC.

CMP has defended its storm response, saying crews brought into restore power shortened the length of time customers were without power following a Christmas Eve storm in 2022 that knocked out power to more than 300,000 customers.

The utility agreed to consider the costs and benefits of hiring additional internal crews for storm response, right-of-first-refusal contracts with storm contractors, capital projects to protect against storms and “adjusting” its vegetation management program to reduce storm costs.