CompanyGraph
Eversource Energy
ES · NYSE Arca · United States
Holds exclusive electric distribution franchises across three states whose physical grid interdependence forces regulatory compliance in each jurisdiction at the same time.
Eversource holds three state-granted franchises whose underlying grid physics are inseparable, so a reliability event in any one territory propagates load obligations into the others through ISO New England dispatch, binding all three to a single physical obligation regardless of which commission controls each border. That physical unity collides with regulatory fragmentation: Massachusetts DPU, Connecticut PURA, and New Hampshire PUC each run independent rate case calendars with different cost-allocation methodologies, so capital that grid reliability requires in one state may sit unrecovered for a full regulatory cycle in another, capping the pace at which cross-border infrastructure can be financed. Because the franchises are individually granted but physically inseparable, an adverse cost-recovery decision by any single commission impairs system economics across all three territories, and the ISO New England dispatch obligation leaves no mechanism to exit the penalizing jurisdiction. Replacement friction reinforces this structure: exclusive service territories prevent customer switching, and multi-decade depreciation schedules already embedded in rate bases mean any alternative provider would need to absorb regulatory asset write-offs before it could begin operating.
How does this company make money?
The company recovers costs through a regulated rate-of-return on distribution and transmission assets, approved separately by Massachusetts DPU, Connecticut PURA, and New Hampshire PUC through periodic rate cases. Additional charges flow in through volumetric distribution charges — amounts tied to the quantity of electricity delivered — and ISO New England wholesale power costs that are passed through directly to customers.
What makes this company hard to replace?
State public utility commission territorial franchise grants create exclusive service obligations that prevent customers from switching to an alternative provider. Multi-decade depreciation schedules for distribution assets are already embedded in customer rate bases, meaning any replacement provider would first need to absorb regulatory asset write-offs — the accounting recognition that those assets have not yet been fully recovered from customers — before it could begin operating.
What limits this company?
Massachusetts DPU, Connecticut PURA, and New Hampshire PUC each run independent rate case calendars with different cost-allocation methodologies, so capital deployed across the interconnected network recovers at asynchronous rates. Investment that grid reliability requires in one state may sit unrecovered for a full regulatory cycle in another, capping the pace at which multi-state infrastructure can be financed.
What does this company depend on?
The company depends on ISO New England's wholesale electricity market for power procurement, Massachusetts DPU rate case approvals to recover capital costs, Connecticut PURA approvals for distribution system planning, New Hampshire PUC maintenance of its franchise standing, and cross-border transmission infrastructure owned by other New England utilities.
Who depends on this company?
Massachusetts municipalities rely on the network for hospital and police station backup power systems that emergency services depend on. Connecticut manufacturing facilities are exposed to voltage fluctuations that would disrupt precision equipment. New Hampshire ski resorts face loss of snowmaking and lift operations during winter seasons if power is interrupted. Regional data centers serving Northeast financial services require continuous power without interruption.
How does this company scale?
Distribution infrastructure deployment replicates across similar suburban density areas within the tri-state territory through standardized substation and feeder designs. Regulatory relationship management across three state commissions with different procedural requirements and political cycles cannot be standardized or delegated, and that remains the bottleneck as the company grows.
What external forces can significantly affect this company?
Federal FERC (the Federal Energy Regulatory Commission, which oversees interstate electricity) transmission planning mandates require regional grid coordination that extends beyond what any single state commission controls. Massachusetts, Connecticut, and New Hampshire each carry renewable portfolio standards — requirements that a set share of power come from renewable sources — with different compliance timelines. Atlantic hurricane intensification raises reliability requirements for coastal transmission infrastructure across the region.
Where is this company structurally vulnerable?
Because the three franchises are individually granted but physically inseparable, an adverse rate decision by any single commission — denying cost recovery on cross-border infrastructure — impairs system economics across all three territories. The physical grid obligation and ISO New England dispatch requirement remain in force regardless, and there is no mechanism to exit the penalizing jurisdiction.
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