Conn. AG slams grid operator's salary proposal

NEW HAVEN, Conn. - Connecticut Attorney General Richard Blumenthal on Thursday challenged a request by New England's electricity grid operator for nearly $100 million in salaries, executive compensation, lobbying and other costs.

Blumenthal called the amount excessive and unjustified. He filed a motion with the Federal Energy Regulatory Commission, which regulates ISO-New England and approves its budget, asking for hearings to contest its 2009 budget request.

"This is especially troubling at a time when the nation is engulfed in an extraordinary financial crisis and is likely entering the deepest most painful economic contraction since the Great Depression," Blumenthal said.

ISO-New England is a nonprofit based in Holyoke, Mass., that oversees the region's wholesale electricity market.

Blumenthal said ISO-New England leaders are already among the highest compensated grid operator executives in the nation and accused them of imposing anticompetitive market rules that leave Connecticut with the second costliest power in the continental United States.

ISO-New England's top five executives made about $5 million last year, Blumenthal said. Between 2004 and 2007, individual executive compensation increased as much as 200 percent, while Connecticut Light & Power customers' bills jumped 59 percent, he said.

"These irresponsible, reprehensible pay packages are richly rewarding executives for egregious failures," Blumenthal said. "Their compensation has skyrocketed and so have electricity prices, which they are supposed to restrain."

A telephone message was left with ISO-New England.

Blumenthal said ISO-New England failed to detail how much its executives will potentially earn next year in salaries and other compensation. He said regulators should slash executive compensation.

"Like leaders of Wall Street and Detroit, ISO executives arrogantly expect to profit from their own fantastic failures," Blumenthal said. "Instead of showing shame for their failure, ISO's leadership exchanges high fives and demands ever more bloated salaries, bonuses and deferred compensation."

ISO-New England's 2009 budget requests $68.4 million for salaries, benefits and bonuses, a 9 percent increase over this year's budget; 4.5 percent salary increases; hiring 25 new employees and $28.8 million for depreciation and amortization costs, according to Blumenthal.

Blumenthal says ISO uses a faster and more costly depreciation schedule than the one recommended by the Internal Revenue Service. He also objected to a $500,000 request for "external affairs activities," saying most of the money will pay lobbyists, an expense that ratepayers should not be asked to pay.

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