The proposed sale of Aquarion Water Company, owned by Eversource, to the South Central Connecticut Regional Water Authority (RWA) continues to spark debate and concern, particularly in communities like New Canaan. The deal, if approved, would transfer control from Aquarion, a private investor-owned utility regulated by the Public Utilities Regulatory Authority (PURA), to a quasi-governmental agency. The sudden proposal drew criticism for its lack of public debate and transparency, with State Senator Ryan Fazio describing it as “a proposal that was totally out of nowhere from legislative leadership” without any consultation, hearings, or substantial input from affected communities.
Eversource acquired Aquarion in 2017 for over $1.6 billion. Following losses exceeding $440 million in 2023, the company shifted focus back to its core electric and natural gas operations, moving away from water distribution. A significant concern about the potential sale of Aquarion is the absence of regulatory oversight, as RWA is not under the Public Utilities Regulatory Authority (PURA), which regulates most investor-owned utilities in the state. The RWA instead receives input from a 60-member council with representatives from the municipalities in the New Haven area served by the RWA. Those member towns elect five members of the 11-person board of governors.
Concerns center on potential rate hikes, financial implications for municipalities, and a loss of local influence. Currently, Aquarion has maintained a relatively stable rate increase history, with only an 8.5% rise over the past decade. In contrast, RWA’s rates have increased by more than 40% during the same period. New Canaan First Selectman Dionna Carlson voiced skepticism over RWA’s assurances that rates would not surge if the acquisition proceeds. “RWA’s claim that it would hold rates steady after the acquisition is difficult to believe given their track record,” Carlson stated. She warned that without PURA oversight, RWA would have “free rein to impose rate hikes without the same level of accountability.”
The situation began in March 2024, when Eversource announced plans to sell Aquarion, a utility it acquired in 2017 for $1.675 billion. The decision reportedly came in response to financial pressures, including $440 million in losses for 2023. In June, the path to RWA’s potential acquisition accelerated. On June 26, the Connecticut Senate approved Senate Bill 501, an omnibus measure that included provisions allowing RWA to bid on Aquarion. The bill passed without prior public hearings or detailed discussions on the RWA provision. State Senator Ryan Fazio objected, stating, “We’ve had two days to analyze 50 pages of policy changes with billions of dollars at stake, without substantial input from experts or regulators.
The following day, June 27, the state House of Representatives passed the bill, despite similar concerns about the lack of public input. House Minority Leader Vincent J. Candelora, who supported the bill, noted that RWA would still undergo a review process involving public hearings and oversight from the Public Utilities Regulatory Authority (PURA) if the bid succeeded. “Yes, the charter change did not get a public hearing,” Candelora said, “but if RWA decides to bid, they’re going to have to have a public hearing.”
New Canaan officials have been particularly vocal about the potential impacts of the sale. First Selectman Dionna Carlson highlighted the risks associated with removing Aquarion from PURA’s regulatory purview. She questioned whether RWA’s financial structure could keep costs under control.
The financial implications for municipalities are another significant concern. Carlson pointed out that Aquarion currently contributes more than $300,000 annually in property taxes to New Canaan. As a quasi-governmental agency, RWA would be exempt from property taxes, offering instead Payments In Lieu of Taxes (PILOT). “PILOT payments are not a reliable replacement. They’re static and won’t adjust for inflation or infrastructure improvements,” Carlson explained, emphasizing the potential loss of a critical revenue stream for essential services in the town.
Senator Fazio also expressed reservations about the legislative process that enabled RWA’s bid, citing the absence of thorough vetting. “This was a major change that appeared out of nowhere,” he said, pointing to the lack of substantial public hearings before the Senate and House votes. “The residents of New Canaan and other towns deserve transparency in decisions affecting their water service”.
The sale has also raised questions about governance and decision-making power within RWA’s expanded territory. The proposed governance model would allocate representation on RWA’s board based on the number of water customers and land area covered, which could leave smaller towns like New Canaan with limited influence. “Our town would essentially be sidelined when it comes to decision-making,” Carlson stated, arguing that the board structure could marginalize smaller municipalities. Fazio echoed this concern, explaining that “the governance structure is set up to favor larger cities, leaving smaller towns with a diminished voice on water rates and infrastructure investments”.
RWA is now preparing its formal bid for Aquarion, with an evaluation of the water company’s assets underway. If the bid is successful, PURA will still play a role in reviewing the transaction, despite the RWA not being directly subject to its regulations in the same manner as Aquarion. The review process will include public hearings, providing an opportunity for stakeholders to express concerns and offer input.
Both Carlson and Fazio are encouraging local residents to stay informed and participate in the upcoming hearings. “This sale could have long-lasting effects on our town’s finances and water service,” Carlson said, stressing the importance of community engagement. “We need to ensure that residents are fully informed about what’s at stake”.
For more information, residents can reach out to the RWA by emailing jslubowski@rwater.com or calling 203-401-2515.
By Anne White
