Friday, December 18, 2009

3, 992 Pennsylvania Households Using Potentially Unsafe Heating (Space Heaters and Kitchen Ovens) . . . Heating Assistance LIHEAP?

The PUC said that 3,992 households statewide are using potentially unsafe heating sources such as space heaters and kitchen ovens, compared with 3,373 last year.

That is, on the heels of the season's first cold snap, the Pennslvania Public Utility Commission (PUC) has released a report predicting that the number of local households without utility service for heating their homes this winter would be nearly 19 percent higher than at the beginning of last winter.

According to the National Fire Protection Association, potentially unsafe sources of heat include kerosene heaters, kitchen stoves or ovens, electric space heaters, fireplaces and connecting extension cords to neighbors’ homes.

The PUC's Cold Weather Survey said that 17,037 households lack utility heat, compared with 14,372 this time last year. That includes 948 households served by Dominion Peoples, 931 served by Equitable Gas and 829 served by Columbia Gas. The survey also included households with electric heat, and found that 906 households served by Duquesne Light and 265 served by Allegheny Power lacked power.

PUC Reports Show Increases in Terminations and Indicate Concerns for Low-Income Customers

Three documents recently released by the Public Utility Commission point to significant areas of concern for low-income utility consumers. The documents include:

The Second Biennial Report to the General Assembly and the Governor Pursuant to Section 1415;

4-year Average, 2007 & 2008 Cold Weather Survey Results – Electric & Gas; and

Terminations and Reconnections – Year-to-Date: 2007 vs. 2008 Through December.

Second Biennial Report:

Act 201 of 2004, known as Chapter 14, went into effect on December 14, 2004, amending the Public Utility Code. The PUC is required to monitor and evaluate the implementation of Chapter 14 and report its findings to the General Assembly and the Governor every two years.

The Second Biennial Report was released December 14, 2008 and includes much that does not bode well for low-income utility customers:

That is, there appears to be a serious concern that failure of utilities to fully implement Chapter 14 leads to unlawful or erroneous terminations, which present serious issues of health and safety for both the individuals directly involved and the surrounding community.

For the electric industry, the percentage of customers in debt has increased.

The Report states: It does not appear that the electric industry’s strategy of terminating a record high number of customers since the passage of Chapter 14 has been successful.

Looking ahead, the concern remains about the collections performance of the electric industry as rate caps are lifted for PPL on Dec. 31, 2009, and for Met-Ed, Penelec and Allegheny on Dec. 31, 2010.

The early projections for rate increases are cause for concern when combined with diminishing purchasing power for customers in our current economic climate. These factors may make it more challenging and difficult for the electric industry to manage its collections performance and costs.

Chapter 14 prohibits the Commission from establishing a payment agreement for customers who have defaulted on CAP (Customer Assistance Program) payments.

Through October 10, 2008, the PUC has turned away 24,144 CAP customers who wanted to have their payment arrangements reviewed.

The Second Biennial Report specifically states that: For CAP customers who fail to meet their obligations under CAP, there is no recourse other than to pay their arrearages and current balances in order to maintain utility service. This is arguably a losing proposition for them.

These customers are at the greatest risk because they are out of options.

There are low-income households who are payment-troubled and have not yet been placed into a CAP program. This represents a still significant number of such households since the passage of Chapter 14. Consequently, there is still room for CAP programs to grow.

For non-CAP customers, Chapter 14 prohibits the Commission from establishing a second payment agreement if the customer has defaulted on the first.

Since the passage of Chapter 14, the Commission has turned away over 47,000 non-CAP customers requesting a payment arrangement.

In total, as a result of Chapter 14, the Commission has been unable to assist 71,516 customers (non-CAP and CAP customers) who were seeking payment arrangements.

Since 2004, termination numbers for the electric industry have reached record levels, increasing 60.1 % during the period from 2004 to 2007.

Terminations for the gas industry increased 21% from 2004 to 2007.

Termination rates (calculated by dividing the number of terminations by the number of customers) for the electric industry have risen to record high levels since the passage of Chapter 14, increasing from 2.06 to 3.25 from 2004 to 2007.

Overall, the termination rate has increased by 86% from 2002 to 2007.

The declining economy is creating a “new poor” as diminishing purchasing power for consumers combines with higher utility costs.

The Second Biennial Report concludes that: It is likely that additional thousands of utility customers will face unaffordable utility bills in the years ahead.

Given the continuing trend of higher levels of service terminations under Chapter 14, the economy and the prospect of higher utility prices, greater numbers of Pennsylvania households may be faced with the risk of losing essential utility services in the coming years.

Additional funding and support for safety net program is critical to ensure that all Pennsylvania households receive essential utility services.

Cold Weather Survey:

The Cold Weather Survey, mandated by PUC regulations, is undertaken each fall; it involves a survey by all PUC-regulated natural gas and electric utilities of residences where service has been terminated throughout the year and not reconnected. Utilities attempt to contact these terminated households via certified letters, phone calls, and personal visits.

A total of 14,372 households normally using electric or gas heat were without service after completion of the survey (excluding vacant residences and households using potentially unsafe heating source or other central heating sources) – an increase of 4% from 2007 to 2008.

20,037 residences that were terminated now appear to be vacant, a 16% increase from 2007 to 2008.

3,373 households are using potentially unsafe heating sources, a 9% increase from 2007 to 2008.

Terminations and Reconnections – Monthly Report:

The regulated utilities are also mandated by Chapter 56 of Title 52 of the Pennsylvania Code to report terminations and reconnections on a monthly basis.

The latest report shows that the number of terminations by electric utilities in 2008 increased 26% compared to 2007.

The number of service terminations by gas utilities increased by 10% over the same time period.

A total of 331,220 utility customers had their electric, gas or water service terminated in 2008.

Summary and Necessary Actions:

Since the passage of Chapter 14 in late 2004 (immediately following Joe Preston's re-election in November 2004), both the rate and number of utility terminations have increased, jeopardizing the health and safety of those households without utility service, particularly in the cold winter months; and thousands of consumers have been denied payment arrangements because of restrictions placed on the PUC.

Spending for CAP and other low-income utility programs, including LIURP (Low-Income Usage Reduction Program), CARES (Customer Assistance and Referral Evaluation Services) and Hardship Funds must be increased and outreach to low-income consumers must be improved in order to enroll all those who are eligible, especially as the economy worsens and rate caps on electric generation prices are lifted.

Todd Elliott Koger advocates the following essential protections for low-income consumers:


Chapter 14 and Joe Preston must go!

The poor and low-income residents of Pennsylvania State Assembly District 24 should be horrified by the hypocrisy of Joe Preston who parlayed his leadership position within a committee into an opportunity for lucrative campaign contributions from the utility companies in exchange for passage of Chapter 14.

Since its passage, Joe Preston wants you to believe that Chapter 14 protects paying customers from higher bills.

With few, if any, humanistic considerations, he mistakenly believes the only problem associated with the poor and low-income freezing to death isn't a human problem but rather a problem of energy industry profits.

He has been dehumanizing the poor and low-income as "deadbeats" leaching off "good customers."

However, poverty isn't about people being bad or making bad choices. It is about having corrupt and decadent social systems that make people unfathomably rich at the expense of the rest of us.

To illustrate and humanize this issue, one must look at who is really hurt by Chapter 14.

Chapter 14 and Joe Preston must go!


The PUC should make it its policy and the policy of utilities to avoid service terminations wherever possible.

CAP payments should be required to be affordable.

Because low-income consumers have certain protections from service terminations during the winter months, the Commission should obligate the utilities to ask about household income at every opportunity so that incorrect terminations do not occur.

Utilities should be required to report to the Commission anytime they become aware of a death or serious injury at a residence without utility service.

In short, thousands of our neighbors are regularly waging a battle without the use of their central-heating system because their electric or natural gas service has been terminated.

Todd Elliott Koger urges consumers without utility service to know their rights and obtain information about programs available to help them restore and maintain utility service.

For example, consumers with a seriously ill resident in the household or a protection from abuse order may have additional options for service restoration.

Winter Shut-off Protection Began December 1:

Low-income utility customers who are unable to pay their bills are protected from service terminations from December 1 through March 31. Household income must be at or below 250% of the Federal Poverty Income Guidelines.

Customers who receive termination notices after February 1 and meet income guidelines may be eligible for a LIHEAP Crisis grant to stop the termination.

Electric Utility Education Plans To Mitigate Rate Increases:

The PUC provided final approval of the rate mitigation education plans of PPL, PECO, UGI Electric, Citizens’ Electric, Wellsboro, West Penn Power, Pike County Light & Power, Duquesne Light Co., and the FirstEnergy Companies of Met-Ed, Penelec and Penn Power.

These plans are in response to the May 17, 2007 Commission Order, at Docket No. M-00061957, which directed all electric distribution companies (EDCs) to prepare and file a consumer education plan to mitigate potential electricity price increases that could follow the expiration of generation rate caps.

The intention is to prepare Pennsylvanians for removal of electric rate caps and to enable consumers to make informed decisions regarding their levels of electric use.

The plans are required to include specific education elements which inform consumers that:

Rate caps of their electric providers have or will expire on a certain date;

When rates change there may be significant increases;

Customers may be able to take steps to control the size of their electric bills;

Customers may benefit from utilizing energy efficiency, conservation and demand side response measures;

Information about these measures is readily available;

Customers may reduce the size of their electric bills, or receive service options more suited to their needs, by purchasing generation service from an alternative electric generation supplier;

Current information that will allow customers to make informed choices about competitive generation alternatives is readily available; and

Programs exist to help low income customers maintain their utility service, and information about them is readily available.

Consumers should call their utility. If they are unable to reach an agreement with the utility, the PUC may be able to provide assistance.

In conclusion, a Dec. 11, 2007, letter sent to electric and natural gas utilities under its jurisdiction, the PUC asked the utilities to join the PUC in reaching out and educating consumers.

The Commission’s “Prepare Now” outreach campaign appeals to consumers on limited or fixed incomes to call their utility about special programs such as Customer Assistance Programs (CAPs) and Low Income Usage Reduction Programs (LIURP) to help heat their homes and pay their energy bills.

The letter also stressed the importance of the Low Income Home Energy Assistance Program (LIHEAP) and the impact the program has on helping low-income consumers restore and maintain service.

Consumers on limited or fixed incomes should call their utility about special programs such as CAPs and LIURP to help heat their homes and pay their energy bills.

Every major utility offers a CAP, under which qualifying low-income customers pay discounted bills. Qualification in the CAP program is based on household size and gross household income. LIURP helps consumers lower the amount of electricity or natural gas used each month. The company may install energy saving features in your home to help reduce bills.

Consumers should call their utility to inquire about such programs.

The Low Income Home Energy Assistance Program (LIHEAP) may have funds available to help eligible customers have service restored.