By Elizabeth Barhydt
Connecticut utility regulators halted the proposed sale of Aquarion Water Company on Wednesday, issuing a unanimous ruling that cited fundamental flaws in the deal’s structure and its impact on residents and towns. The decision followed months of coordinated opposition from communities across western Connecticut, including New Canaan, which argued that the plan would raise rates, weaken oversight, and reduce local control.
PURA’s ruling laid out a clear concern: the proposed governance model would have created overlapping fiduciary duties that board members could not realistically meet, leaving ratepayers exposed. Regulators concluded that the structure was “unworkable” and did not meet the state’s public-interest standard.
Local officials had been preparing for that outcome. New Canaan First Selectman Dionna Carlson, who joined leaders from Fairfield, Ridgefield, and Westport to oppose the transaction, said the ruling validated what town leaders had been warning for months. According to the town’s release, Carlson and her counterparts argued that the sale would saddle residents with rising costs while eroding municipal revenue.
Attorney David Ball, representing the four towns, stated that PURA “recognized the concerns raised by the Towns in opposition, including the potential for higher water rates because of the debt service AWA would have been saddled with, and the fact that rates have been consistently higher in the RWA region compared to the Aquarion region.” He emphasized that the Authority also flagged the long-term decline in municipal revenue caused by PILOT payments, the governance conflicts embedded in the structure, and the replacement of the state’s independent consumer advocate with an entity lacking independence and staffing.
State Senator Ryan Fazio, who had been vocal in his opposition since the legislation enabling the sale was introduced, called the decision a critical protection for Connecticut families. In earlier public comments on the proposal, he said, “The cost of living in Connecticut is already proving too much for residents, and this acquisition could have raised utility bills by hundreds of dollars. At a time when families are struggling to keep up, this decision provides much-needed relief.” He also described the original legislative process as rushed, saying, “This deal stinks. It never received public discussion or proper debate and was rushed through the legislative process.”
The PURA decision reflects many of those concerns. Regulators found that the Representative Policy Board serving Aquarion communities would leave half its towns without any real voting power, a condition they said “substantially impairs meaningful local representation.” The Authority also noted that the proposed Office of Consumer Affairs lacked independence and resources compared to the state’s existing Office of Consumer Counsel, which currently participates in all rate proceedings.
Rate projections also weighed heavily in the review. PURA highlighted annual increases between 6.5% and 8.35% starting in 2027—numbers driven by anticipated capital requirements and the structure of the acquisition. The Authority found that the applicants’ model relied on assumptions too uncertain to guarantee savings for ratepayers.
For New Canaan and the region, the ruling marks the end of a process that drew together dozens of local leaders, bipartisan elected officials, and town attorneys. It also keeps Aquarion under its current ownership unless future actions by the legislature or regulators shift the landscape again.
Carlson, reflecting on months of testimony, cross-examination, and legal coordination, said the decision affirms a basic expectation from local government: that major utility decisions affecting residents’ wallets and communities’ budgets must be transparent, accountable, and rooted in the public interest.
