Eversource and United Illuminating sued a group of Connecticut officials in federal court this week, accusing them of trying to impede the federal government’s regulation of the interstate transmission of electricity. Specifically, the lawsuit challenges an obscure section of an omnibus energy savings bill state lawmakers passed in 2025 that required both utilities to join the regional transmission organization ISO-New England. The law — which passed with bipartisan support and was signed by Gov. Ned Lamont — had no practical impact on the utilities’ participation with the grid operator: Both Eversource and UI have been voluntary members of ISO-NE since its inception in 1997. But earlier this year, regulators in Connecticut cited the law in a complaint to the Federal Energy Regulatory Commission asking the agency to withdraw financial incentives approved by Congress to encourage the two utilities’ participation with the grid operator, ISO-NE. Because their participation is no longer voluntary, the officials argued, the incentives are no longer needed. FERC has yet to rule on the complaint. The utilities responded by filing their lawsuit in federal district court in Connecticut on Monday, arguing state officials had overstepped their roles. The lawsuit named each of the officials and agencies who brought the complaint before FERC: Attorney General William Tong and Consumer Counsel Claire Coleman, along with the Department of Energy and Environmental Protection and members of the Public Utilities Regulatory Authority. “From the beginning, the provision in Connecticut statute that mandates utility membership in ISO-NE was an overreach led by the executive branch, usurping the authority of federal regulators who have jurisdiction over transmission systems,” Eversource spokesperson Jamie Ratliff said in a statement Thursday. A spokesperson for UI did not immediately respond to a request for comment Thursday. The attorney general has yet to formally respond to the complaint in federal court. In a statement Thursday, Tong criticized the companies’ motivations for filing the lawsuit. “The utilities want ratepayers to keep footing the bill for bonuses tied to actions the companies are required to do by law,” Tong said. “We sued to stop these brainless bonuses, and so now the utilities are trying to strike down the law. The bottom line is Connecticut families are paying way too much for their energy bills, and we’re going to keep fighting against every padded profit and unjustified cost.” Together, the two companies received about $17 million in incentives for participating in ISO-NE during 2024, according to the FERC complaint. The share of that amount paid for by Connecticut ratepayers was about $4.5 million. Those charges amount to about $1 per year for the typical utility customer, Ratliff said. “The investments we have made on behalf of customers have been critical to reduce the high cost of congestion pricing, providing customers with billions of dollars in savings over the past several years,” she said. “In short, this overreach by Connecticut will do little — if anything — to benefit customers in the short term while causing them significant long-term harm, and we will continue to bring a customer-first focus to everything we do.” The primary author of the law in question, state Sen. Norm Needleman, D-Essex, said he expected the utilities to challenge the section dealing with ISO-NE when the bill was drafted. Needleman, who serves as co-chair of the legislature’s Energy and Technology Committee, said the section was a relatively small piece of a broader effort to bring down the cost of electricity. Needleman said the bill was drafted in consultation with DEEP and OCC. “We did a bunch of stuff that we thought we could do, and I think we thought that this one would meet the legal standard,” Needleman said. Since passage of the Connecticut legislation, Senate Bill 4, lawmakers in Maine, Rhode Island and Maryland have passed similar laws requiring participation in their regional transmission organizations. “These efforts are not isolated, but reflect a broader state-driven strategy to reshape the federal framework governing interstate transmission,” attorneys for Eversource and UI wrote in their complaint. The lawsuit goes on to argue that FERC and Congress have exclusive jurisdiction over regulation of the interstate delivery of electricity, including setting transmission rates. State regulators, such as Connecticut’s PURA, have oversight of the distribution grid that operates along local utility poles. The lawsuit also claims that S.B. 4 violates the companies’ property and contract rights under the U.S. Constitution. Coleman, who heads the state’s Office of Consumer Counsel, said in a statement Thursday that the section of S.B. 4 addressing utility participation in ISO-NE was modeled off similar laws that were already in place in California and Ohio. Both of those laws prompted similar lawsuits, she added, and were upheld by two federal circuit courts. (In November, the U.S. Supreme Court declined to hear an appeal of the Ohio case.) “Courts have already upheld FERC’s authority to remove this profit bonus for transmission under similar circumstances,” Coleman said. “We will work to uphold the legislation being challenged and ensure it can appropriately protect Connecticut ratepayers.”  Bill Flood, a spokesman for DEEP, said in a statement, “While we will not comment on specific aspects of this case, as it is active litigation, it seems clear that Connecticut will prevail in defending this approach, which other states and federal courts have blessed.” A spokesperson for PURA did not immediately respond to requests for comment Thursday. Earlier this year, FERC ordered utilities across New England, including Eversource and UI, to refund customers $1.5 billion in excess transmission costs dating back to 2011. Transmission owners have appealed the ruling. ...read more read less