Hydro hearings

It’s not surprising that Bangor-Hydro got roasted at public hearings in Bangor and Machias this week — 15.58 percent rate increases tend to inflame.

Nor is it surprising, given the public’s increasing savvy regarding utilities and the rate-case process, that the 250 who turned out didn’t just rant. They offered suggestions and solutions, some heretofore unthinkable.

Like bankruptcy, a management overhaul, a forced sale to a larger utility, forcing shareholders to eat the loss. Harsh measures to be sure, but to many residents and businesses in Eastern Maine, not as harsh as a $20.6 million rate hike.

Quite surprising, however, was the extent to which to Public Utilities Commission was slapped around, especially at the Bangor hearing, with several speakers saying the watchdog has become the lapdog. Given the PUC’s record of subjecting rate cases to thorough scrutiny, its record of trimming increses substantially and the fact that PUC staff already has recommended the nearly 16-percent request be cut to 6 percent, such criticism seems unfair and counterproductive.

Between now and February, when a final decision is due, the PUC must sort out which components of the rate case spring from management decisions that went wrong, such as years of deferred maintenance and repairs at Maine Yankee, and which are the result of forces beyond Bangor-Hydro’s control, like the 1987 state law requiring utilities to enter into ruinously expensive contracts with small non-utility generators to head off an oil crisis that never came. To the shareholders go the former; to the ratepayers the latter. Let the shareholders deal with management issues at its annual meeting; let the ratepayers deal with unwise legislation at the polls.

Of all the suggestions offered, the idea that the PUC should force, or at least direct, Bangor-Hydro toward bankruptcy is one that should not be considered. Maine’s economic climate is harsh enough; the state should not chill it further by encouraging businesses to dodge legimate fiscal obligations.

The third major component of the case stems from the new state law restructuring the utility industry. While intending to foster competition, this could cost Bangor Hydro a major chunk of its customer base, actually decreasing competition, especially in rural areas. Since the law does not take effect for two years, there still is time for the Legislature to look more closely at what other states are doing and to fix what they did for Maine. Now that the public has found its voice, there’s something else to speak up about.