AG Neronha files motion to appeal sale of Narragansett Electric to PPL

The proposed transaction, according to the attorney general’s office, would have “enormous consequences for all Rhode Islanders.”

A National Grid crewman removes a snapped electrical pole from Caswell, St. in Narragansett, R.I.Stew Milne/Associated Press

PROVIDENCE — Just a day after state regulators approved the transfer of the Narragansett Electric Company – National Grid’s electric and gas business for customers in Rhode Island – to PPL Corporation, state Attorney General Peter F. Neronha filed a motion to appeal the decision.

The proposed transaction, according to the attorney general’s office, would have “enormous consequences for all Rhode Islanders.” Neronha’s office filed a motion in Rhode Island Superior Court to appeal and stay Wednesday’s decision by the Division of Public Utilities and Carriers

In the court filings, Neronha’s office said it appealed the decision on the grounds that it does not sufficiently provide assurances that the sale is in the best interests of Rhode Islanders, including whether or not the sale would result in degradation of services or significant rate increases.

Neronha also questioned if Philadelphia-based PPL would be capable of creating an effective storm response and provide necessary IT services without increasing costs to ratepayers. He said in his court filings that he would like to see if PPL can effectively work with the state to meet emissions and other goals required by the Act on Climate.

Neronha said the state’s decision did not consider whether PPL had a viable post-transaction financial plan as one was not submitted.

“I am not alone in raising these issues —the DPUC’s own attorneys and experts expressed serious unresolved concerns about this transaction during the hearing before the DPUC,” said Neronha in a statement Thursday.

The attorney general’s move to file a motion should not come as a surprise: Experts in his office raised questions about the sale in December. But the Division of Public Utilities and Carriers said “after a thorough examination of the record,” including many public comments, the evidence shows “that the facilities for furnishing service to the public will not thereby be diminished” by approving the transaction.

In March, the companies announced that the Narragansett Electric Company would be sold to PPL for an equity value of $3.8 billion. But the purchase required regulatory approval. Neronha’s office intervened when the petition came before the DPUC.

Narragansett Electric is the largest electricity transmission and distribution service provider in Rhode Island, and it is a natural gas distributor in the state, serving some 780,000 customers. PPL has about 2.7 million customers.

DPUC’s decision had noted the experts’ comments in the past, and said PPL had indicated that it would abide by all the laws and regulations in Rhode Island, including those pertaining to state’s goals for reducing greenhouse gas emissions.

“PPL has committed to step into National Grid’s shoes with respect to all existing programs and initiatives, including its energy efficiency programs and renewable energy procurement processes,” the division concluded Wednesday in its decision. “PPL has also made several long-term commitments in support of its efforts to comply with the Act on Climate and to demonstrate its pursuit of a robust renewable energy agenda.”

But Neronha said he was concerned about the “legal standard” that was used by the hearing officer in reaching the decision.

“A legal standard that creates a low threshold for approval of these significant transactions that would potentially leave Rhode Islanders at future risk,” Neronha said.

PPL spokesman Ryan Hill issued a statement saying, “On Wednesday, the Rhode Island Division of Public Utilities and Carriers issued a thoughtful, transparent, and comprehensive decision approving National Grid’s sale of The Narragansett Electric Company to PPL. The Division found that PPL met all the criteria for approval and explained those findings in compelling fashion.”

Hill said PPL believes the division made the proper decision and that PPL clearly met Rhode Island’s standard for approval.

“We look forward to a quick and successful resolution of the attorney general’s stay request, which was filed earlier today, and do not intend to comment further on the appeal at this time,” the PPL statement said.

– Staff writer Edward Fitzpatrick contributed to this report