For Immediate Release - November 23, 2010

AG Coakley Appeals National Grid Gas Rate Increase

Urges Court To Reverse DPU's Decision To Allow Boston Gas' Rate Increase

BOSTON - Arguing that the Department of Public Utility's (DPU) decision to allow $41 million in rate increases for customers of Boston Gas, a subsidiary of National Grid, was unsubstantiated by facts or law, Attorney General Martha Coakley's Office today appealed the DPU's decision in the National Grid rate case.

The appeal stems from National Grid's rate case in which it had sought a $104 million rate hike for its three local gas distribution subsidiaries: Boston Gas Company, Essex Gas Company, and Colonial Gas Company. On November 2, the DPU issued a decision allowing $58 million of the proposed increase for those subsidiaries. The Attorney General's Office had urged the DPU to reject the rate hike in its entirety.

Today, AG Coakley specifically appealed the decision by DPU to allow the Boston Gas subsidiary to break a ten-year rate plan approved by DPU in 2003 and raise rates by $41 million. In today's appeal, the AG's office argues that DPU did not appropriately consider the arguments in connection with that decision and failed to show that the termination of the previous Boston Gas contract was just and reasonable.

"We are appealing the $41 million rate increase on behalf of Boston Gas customers because we do not believe that the DPU demonstrated that it met its obligations to carefully consider all arguments," Attorney General Coakley said. "We do not believe on this record that the rate increase was warranted."

Coakley had sought to reject the full $104 million National Grid rate hike request which would have been the largest gas rate increase in Massachusetts history. During its investigation, the AG's Office had uncovered hundreds of thousands of dollars in inappropriate expenses filed by National Grid, including a special shipment of an executive's wine collection from Great Britain to the United States, attendance by executives to the presidential inauguration and other political activities, and tuition to send children of a National Grid executive to an exclusive British private school.

Coakley also sought a full independent audit of National Grid's expenses which was granted by the DPU. That audit could result in further savings from the approved rate hike.

The Attorney General's Office of Ratepayer Advocacy serves as the utility ratepayer advocate and is authorized to intervene in administrative and judicial proceedings on behalf of consumers in connection with any matter involving the rates, charges, prices or tariffs of any electric company doing business in the Commonwealth.