History
Formation: Legislative actions by Connecticut’s General Assembly, dating back to the early 1900s, defined the franchise areas of municipal electric utilities (MEUs) in the state, and limited the provision of electric service primarily to areas within the municipality. In 1975, the MEUs obtained passage of legislation to form their own power supply company, pursuant to which CMEEC was established in 1976 as a publicly directed, not-for-profit, joint action agency owned and controlled by its member MEUs. Our mission and operating principles are founded on state statutes, CMEEC bylaws and a long-standing commitment to serve our community utilities.
State statutes “permit municipal electric utilities in Connecticut to join together and form cooperative public corporations for the financing of the construction and acquisition of facilities for the purpose of furnishing efficient, low cost and reliable electric power in their areas of operation.” For additional information, please refer to Chapters 101 and 101a of the Connecticut General Statutes. Pursuant to the agreements creating CMEEC, in 1980 the MEUs began to act in concert through CMEEC, combining their loads and power supply portfolios to achieve savings and scale needed to efficiently and beneficially participate in local and regional projects.
Today CMEEC manages power supply contracts, financing, acquisition, construction and operation of generating resources. CMEEC supplies power to its members and wholesale customers through various specific contracted generation resources (including hydropower, solar and fuel cell) as well as purchased in the regional wholesale energy markets operated by ISO-NE.
All-requirements: CMEEC’s all-requirements model requires our MEUs to purchase essentially all electric power requirements from CMEEC. This commitment results in a joint action agency with cooperative strengths vital to CMEEC’s dealings with other utilities, the investment community and other energy industry stakeholders.
Tax-exempt: A basic statutory authority provided to CMEEC is the ability to issue long-term tax-exempt electric power supply revenue bonds. This allows CMEEC to borrow investment funds at relatively low interest rates to pay for obtaining electric generating and transmission facilities and associated infrastructure. Repayment of interest received by bond-holders – the lender of money to CMEEC – is tax-exempt because the money borrowed is used for not for profit essential municipal utility purposes. CMEEC bonds are secured by power sales contracts between CMEEC and its MEUs.
Customer-driven: Neither CMEEC nor the MEUs conduct their electric operations for shareholder profit. The customers and citizens of the municipality are the only “shareholders” for municipal utilities. This is a principal distinction between “public power” entities and investor-owned utilities that are subject to increased levels of state and federal regulation. Our local control and governance comes from the local MEU utility commissions and legislative bodies through which the communities appoint members to our Board of Directors.
Cost-based: Under the contracts, money paid by the MEUs to CMEEC for community electricity covers the actual costs of obtaining the power, such as direct power production costs, staffing and overhead costs, power plant financing costs, and costs of entering into more beneficial power supply contracts with regional suppliers. CMEEC bills its MEUs “at cost” for these goods and services that are provided.
Projects: CMEEC has constructed its own peaking power plants, enabled the development of some 15MW of solar farms in MEU territories and helped coordinate MEU demand response programs. To better accommodate MEU customers’ power quality needs, CMEEC enables the development of electric generation and related power projects at MEU customer sites. In 2009, CMEEC also established the Connecticut Transmission Municipal Electric Energy Cooperative, d/b/a Transco, to bring benefits of collective transmission asset ownership to its Members.