Consumer advocates mourn departure of Kentucky’s top utility regulator

Republished from Kentucky Lantern

The chair of Kentucky’s utility regulator is leaving the post after almost three years to the disappointment of some consumer advocates. 

Kentucky Public Service Commission Chair Kent Chandler’s term on the three-person commission expired on June 30. Crystal Staley, a spokesperson for Kentucky Gov. Andy Beshear, said Chandler had resigned and that the governor appreciated Chandler’s service. She said his replacement would be appointed soon. 

Chandler in a statement to the Lantern said he had no indication or confidence he would be reappointed to another four-year term, based on a lack of communication from the Beshear administration regarding his reappointment. 

“I decided it was best for me and my family to walk away at the end of my term,” Chandler said, noting he appreciated serving the commission in a number of roles including leading it the last three years. 

Attorneys who represent ratepayers — both households and manufacturers — praised Chandler’s leadership and expertise as chair.

“I’ve been practicing at the Kentucky commission for 38 years. Kent Chandler is by far the hardest working and smartest commissioner that has been on the bench in my memory,” said Michael Kurtz, general counsel for Kentucky Industrial Utility Customers, a coalition of manufacturers.

Long-time environmental advocate Tom FitzGerald called Chandler’s departure a “significant loss” for the state, particularly for residential and small business ratepayers. FitzGerald, the former executive director of the nonprofit legal firm Kentucky Resources Council, in an email said while some utility representatives might have issues with a particular PSC decision, nobody “can credibly state that he was not among the most diligent, thoughtful, involved, and fair commissioners that we have had at the PSC.” 

“I am very disappointed that Gov. Beshear failed to reappoint chair Chandler,” FitzGerald said. “Those of us who represent ratepayers with low- and fixed-incomes who are among the most vulnerable to high utility costs, are especially appreciative of his service and the sacrifice of his family in allowing him to put in long hours at short pay in service to the ratepayers of the Commonwealth.”

FitzGerald said Chandler’s departure comes at a time of unprecedented change in how electricity is generated and used, ranging from the “integration of renewables and storage to the grid” to the “retirement of uneconomic coal-fired units.” He said while he believed the two remaining commissioners at the regulator are “able and thoughtful people,” neither have the “breadth of experience” that Chandler has. 

PSC faces increasing demands

The Kentucky Public Service Commissioner (PSC) regulates the rates and services of more than 1,100 utilities, ranging from massive investor-owned electricity providers such as Louisville Gas and Electric and Kentucky Utilities to small water districts that provide drinking water to rural communities. The regulator also fields complaints from Kentuckians about service and rates and hears requests from utilities to retire or build new power generation.

The PSC is facing increasing demands to vet a surge of renewable energy developers seeking to build solar installations, navigate new laws passed by the GOP-dominated legislature placing barriers on retiring fossil fuel-fired power plants, and oversee water utilities grappling with aging and dilapidated pipes, water tanks and treatment plants. 

In his statement to the Lantern, Chandler said: “Most people don’t know what the public service commission is, and maybe they shouldn’t have to know. The irony is that if a PSC is well-resourced and doing a good job at regulating rates and service, over time their work should be seamless and unnoticeable, and the efforts should result in affordable and consistent utility service by those they regulate. Of course, it’s not obvious year to year the impact the PSC has on the public, so taking the PSC’s efforts for granted can lead to a lack of resources made available to the agency.” 

Chandler said he had the “utmost confidence” the remaining commissioners and the regulator’s “incredible staff” would continue the PSC’s mission “without missing a beat.” 

Chandler last year called for more funding for the commission, saying “something has to change” because the regulator was dealing with an increasing number of cases, with expanding complexity, coinciding with having fewer and less experienced staff than in the past. 

The GOP-dominated legislature in the two-year state budget enacted this year did increase funding for the regulator by a little over a million dollars from fiscal year 2023-2024 to fiscal year 2024-2025 for a total yearly budget of nearly $18 million. 

But the legislature also put new burdens on the regulator in the form of mandated eight-month deadlines the commission has to issue decisions by in certain types of cases, including the building of new power plants. Those deadlines were passed as a part of Senate Bill 349. Beshear in an April letter to the legislature said the regulator would take on a little over $1 million in unfunded costs because of SB 349, among other passed laws that the governor said would have funding omissions

Under Chandler’s leadership, the commission had strongly scrutinized future power generation plans utilities are required to create and present, had opened investigations into electricity cost discounts given by utilities to cryptocurrency mining operations, honed in on power outages and costs faced by utilities during Winter Storm Elliott in December 2022 and slashed a much-criticized rate hike sought by utility Kentucky Power. 

Chandler had previously served as an attorney in the Attorney General’s Office of Rate Intervention when Beshear was attorney general. Before his appointment, Chandler served as an advisor to the commission on federal wholesale gas and electricity markets and also served as the commission’s executive director. He was appointed as a commissioner and designated as the commission’s vice chair in July 2020 and was designated as chair of the commission in August 2021. 

Whoever the Democratic governor does appoint to the commission would have to be confirmed by the GOP-dominated Kentucky Senate, which isn’t a guarantee. Amy Cubbage, an attorney who formerly served as Beshear’s general counsel among other roles in his administration, wasn’t confirmed by the Senate to the commission in 2022.

The Kentucky Public Service Commission, from left, Angie C. Hatton, former chairman Kent Chandler and Mary Pat Regan. (Kentucky Lantern photo by Liam Niemeyer)

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