Are Activist Utility Regulators Putting Personal Agendas Over Doing Their Job?

Traditionally, the job of a public service commissioner — someone who regulates utilities like gas, water, and electricity — has been conducted by people who have a calling for public service. Out of the spotlight and not overtly partisan, they quietly go about their work, determining what a utility can charge customers and what investments a company can make, often in terms of upgrading services and infrastructure. But across the country a trend is developing where public service commissioners are transforming normally routine bureaucratic posts into positions in which they can become advocates.

These new firebrand commissioners are happy to raise their public profile even as they often push a political agenda. The activist regulator does not hesitate to embrace an adversarial approach with the utilities they oversee. What may be most dangerous about this new combative posture taken by regulators intent on “standing up” to utilities to curry favor with the public and to win political points is that it is taking place at a time when aging infrastructure must be upgraded to embrace electric vehicles, wind, and solar power. Rather than allowing regulated utilities to spend capital on improving infrastructure to usher in clean-energy requirements, activist regulators are determined to punish the utilities for when the infrastructure fails. 

Consider Marissa Gillett, chairperson of Connecticut’s Public Utilities Regulatory Authority (PURA). Appointed by Governor Ned Lamont, Gillett portrays herself in the media, from which she does not shy away, as a “true believer.” Others have a different view. “Very adversarial. Contemptuous. Hostile,” Hartford Business Journal observed. “Those are some of the concerns laid bare by investors about the regulatory environment in Connecticut, in light of [Gillett’s] Public Utilities Regulatory Authority’s recent cut to Aquarion Water Company’s rates, and the upcoming launch of performance-based ratemaking, a controversial new approach the state will use to evaluate rate increases proposed by electric utilities Eversource and United Illuminating.” Gillett does not evade such hostile descriptions, announcing defiantly, “The governor…brought me in to be a disruptor. If there is discomfort with the fact that I’ve kind of thrown the doors wide open here…I would embrace that critique because that was intentional.” 

An attorney who studied bioengineering, Gillett is just what Lamond wanted. Still, according to the Connecticut Mirror, “[a] more adversarial approach to utility oversight by Gillett has put her at odds with…colleagues…and created tensions in the small regulatory agency.” One publication believes this “self-described ‘adversarial’ approach [has] rattled Wall Street,” noting that not only did PURA deny a $35 million increase sought by the Aquarion Water Company, it also ordered a $2 million reduction that left the Eversource subsidiary apoplectic. The cut…all but announced there’s a new sheriff in town.” The hostility may have unintended consequences as some observers believe Gillett’s antagonism may discourage utilities from seeking funding to modernize facilities and infrastructure.

Another in the mold of Gillett is Doug Scott, the Illinois Commerce Commission chairman, appointed by the governor in June 2023, who held the same position from 2011 to 2015. Scott left the ICC to help pass the Climate and Equitable Job Act (2021), which, to quote one publication, “set a goal of decarbonizing the state’s electric grid by 2045.” He returned to the ICC to implement the new legislation, and his adversarial posture became clear soon enough. In November, he spearheaded, according to Capital News, “a series of bombshell decisions…that cut increases for Illinois’s four largest gas utilities” even as ICC “paused” $265 million worth of gas pipeline replacement to be carried out by Peoples Gas, prompting a local union to describe the decision as “a troubling example of political overreach [at the hands of] unconfirmed appointees [who are] playing games with people’s jobs, heat, and safety.” Then, in December, the ICC cut rate increases for two electric utilities because, Scott said, the proposals had “significant shortcomings” — and Scott had made his point. The relationship between the utilities and the ICC was no longer congenial. It was now adversarial, a posture presumed to be appealing to the public.

It's not clear if Doug Scott has political aspirations beyond being a public commissioner. Such is not the case with one of his counterparts in Louisiana where, in 2022, Davante Lewis became the first openly gay person to assume state office when he was elected to the Public Service Commission, a milestone that warranted a major profile of Lewis in The Nation. With his election, he intended, it was reported, “to take on utility giants such as Entergy and move the state toward more renewable energy in his first six-year term.” Indeed, Lewis, who accepted campaign donations only from individuals, not utilities, did not consider his role as one of oversight, describing utilities to The Nation as “human rights services” and declaring, “I was elected as a consumer protector, right?” What’s more, Lewis, like Gillett and Scott, is also reluctant to allow Louisiana’s regulated electric companies to invest in maintaining the state’s electrical grid, which is deeply problematic in a state prone to being struck by massive hurricanes. It has become clear, though, that Davante Lewis’s portrayal of activist commissioner may have been merely a calculated move to place himself in the limelight when, in December 2023, it was reported he is exploring a run for chairman of the Louisiana Democratic Party.

These activist regulators may be successful at ensuring utilities are held more accountable for blackouts and other failures, but they also block investment into America’s critical infrastructure like the electrical grid. As resentment grows against utilities across the nation, mainly because of higher bills due to inflation, there is the likelihood that more offices will be held by activist regulators, who regard the utility as the enemy, not a working partner. At a time when aging infrastructure must be upgraded to guarantee continued service to customers and the grid must be updated to embrace green-energy standards, it is vital for public utilities — electricity, gas, and water — and the regulatory agencies that oversee them not to descend into acrimony because of adversarial disputes but to work together with a common goal of continuing to provide the reliable service they have given the public for decades.