News and Recent Developments

News & Recent Developments

A summary of program updates and changes for the 2011-2012 LIHEAP Program Year is found below. A detailed discussion of LIHEAP is found in PULP’s LIHEAP Advocates Manual, updated each year in November.

SUMMARY OF UPDATES AND CHANGES FOR THE 2011-2012 LIHEAP PROGRAM YEAR

Program Dates: 

  • Cash opens Nov. 1, 2011 and closes March 30, 2012.
  • Crisis Exception Payments open Nov. 1, 2011 and close Jan. 2, 2012.
  • Crisis opens Jan. 3, 2012 and closes March 30, 2012.
  • Crisis Interface/Weatherization Assistance Program opens Nov. 1, 2011 and closes March 30, 2012.

Eligibility:  Eligibility is set at 150% of the  Federal Poverty Income Guidelines:

Household Size    

Household Income

1

$16,335

2

$22,065

3

$27,795

4

$33,525

Each additional person

$5,730

Grant Amounts:

    • Minimum Cash grant will be $100.
    • Maximum Cash grant will be $1,000.
    • Minimum Crisis grant will be $25.
    • Maximum Crisis grant will be $300.

Crisis Definition for Deliverable Fuels – Final Plan, § 601.62:

For purposes of determining eligibility for a Crisis grant, DPW interprets the definition of a crisis to include situations where a deliverable fuel customer will run out of its fuel source in less than 15 calendar days.

The Crisis must require more than $25 to be resolved:

Any household requiring less than $25 to resolve a home heating emergency will not be eligible to receive a Crisis grant.

The utility must apply the LIHEAP Cash grant payment to the CAP customer’s “Asked to Pay” amount – Final Plan §601.45:

Public utilities that operate CAPs (Customer Assistance Programs) are required to apply the LIHEAP Cash component benefits only to the customer’s monthly “Asked to Pay” amount. No LIHEAP funds may be pooled or applied to a CAP customer’s pre-program arrearages or actual usage amounts.

Heat and Eat Initiative:

DPW will issue a $1.00 heating assistance benefit to SNAP (Supplemental Nutrition Assistance Program) households that are responsible for heating costs and have not already been approved for LIHEAP during the current program year. This will enable SNAP recipients to maximize the SNAP Standard Utility Allowance (SUA).

 Overpayments Less than $25.00

DPW will not seek repayment of any overpayment of less than $25.00 that was caused by fraud, error or misrepresentation, by either the client or vendor.

Licensed Businesses Out of the Home

A household where an individual is operating a licensed business and deducting the home’s utilities on their business’ tax return will not be eligible for LIHEAP.

Fleeing Felon

An individual who is currently incarcerated or fleeing to avoid prosecution, custody, or confinement after a felony conviction (or high misdemeanor in New Jersey) is ineligible to receive LIHEAP benefits.

Heating Appliances

A household will not be eligible for any LIHEAP assistance if the heating appliance isn’t installed and operating based on the manufacturer’s specifications or current code requirements, whichever is more stringent, and isn’t following all applicagble building and fire codes.

Connecting at a New Address

For a customer whose service has been disconnected at their previous address and who needs service to be connected at their new address, DPW will now allow a regulated utility to request 50% of the customer’s back balance from the previous address and a reconnection fee in order to restore service. If the customer receives a LIHEAP Cash grant that is more than this 50% of back balance plus reconnection fee, the remainder of the Cash grant must be applied to the household’s future bills by the utility, which msut also agree to keep service on through the winter moratorium and enroll the customer in a Customer Assistance Program or budget program, if eligible.

Statewide Toll Free LIHEAP Hotline – 1-866-857-7095:

DPW has a statewide toll free Hotline number specifically dedicated to enabling individuals to call regarding LIHEAP issues.

 

PULP News

Patrick Cicero, Esq. joined PULP’s staff on January 3, 2011.
Prior to beginning work for PULP, Patrick was a staff attorney for five years at MidPenn Legal Services where he led their consumer unit and focused on consumer and housing issues. Patrick also worked for three and one half years as the judicial law clerk to the Hon. Sylvia H. Rambo, United States District Court for the Middle District of Pennsylvania. He has served as a lecturer at Pennsylvania State University, Dickinson School Of Law and the Pennsylvania Bar Institute and has been an Adjunct Instructor at Messiah College. As a staff attorney with PULP, Patrick will provide advocacy, training, consultation and support services in energy and utility matters affecting low-income residents of Pennsylvania.

“Prepare Now” Letter Sent by Five PUC Commissioners to Utility CEOs

Each fall, the Public Utility Commission asks the public and utilities to “prepare now” for the cold winter months.  Through its annual “Prepare Now” Campaign, the Commisssion urges low-income consumers to call their electric and gas utilities about programs to help heat their homes or pay their energy bills such as Customer Assistance Programs (CAPs) and Low Income Usage Reduction Programs (LIURP). The PUC also sends a letter, signed by all five PUC Commissioners, to the CEO of each electric and natural gas utility under the PUC’s jurisdiction, with specific suggestions as to how the utilities can reach out, educate and help consumers, especially those on limited and fixed incomes. The Commissioners ask that the CEOs consider:

  • Redoubling efforts to link consumers to programs that are available to help them restore and maintain service such as CAP, LIHEAP and utility or local hardship funds.
  • Referring low‐income customers to CAP when they call to make payment arrangements; and doing everything possible to get customers into CAP, especially if it is a termination‐related problem.
  • Significantly increasing corporate donations to Hardship Funds and other local programs that assist consumers needing help paying their bills.
  • Restoring service to low‐income customers upon enrollment into the company’s Customer Assistance Program (CAP) for the first time.
  • Limiting the number of terminations of confirmed low‐income customers by scaling back the company’s termination program as the cold weather approaches, and reviewing their termination and reconnection procedures to allow customers, who appear to be making a good faith effort to pay their bills, to keep utility service whenever possible.
  •  Waiving or reducing security deposits, reconnection fees and late payment charges if they are a barrier to restoration of service or establishing a payment arrangement.
  • Accepting any combination of LIHEAP Cash grant, Crisis grant, and Hardship Fund grant as sufficient funds to turn on or reconnect service for low‐income customers.
  • Exercising more leniency in establishing payment arrangement plans for all customers.
  • Providing information about home heating safety and working to help obtain repairs to furnaces or heating systems. Low-income customers may be referred to the LIHEAP Crisis program for emergency repairs.
  • Continuing to promote the use of budget billing programs and third-party notification.
  • Providing information on reducing heating costs through conservation including weatherization programs available.

Winter Shut-off Protection Begins 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. Alternate rules apply to customers of PGW (Philadelphia Gas Works). PGW customers may not be terminated during the winter months if the household income level is below 150% of the Federal Poverty Income Guidelines. Those households whose incomes are between 150% and 250% of the guidelines may not be terminated if the household includes anyone 65 years of age or older, or 12 years of age or younger; if a medical certification has been obtained; or if PGW has been paid an amount equal to at least 15% of monthly household income for each of the last two months. To view Federal Poverty Income Guidelines, click
here
. Customers should alert their utility company if they fall within the protected income levels and should notify their company immediately if they receive a termination notice.

Customers who receive termination notices after February 1 and meet income guidelines may be eligible for a LIHEAP Crisis grant to stop the termination. If permission is given by the customer, the utility will notify DPW of the potential termination and will receive the grant on behalf of the customer.

PUC and Widener Law School Pilot Program for Low-Income Consumers with Utility Complaints has been Expanded into Four Central PA Counties

Widener University School of Law in Harrisburg will be helping low-income residents of Cumberland, York, Lebanon and Lancaster counties, in addition to Dauphin County, with utility-related complaints before the Public Utility Commission. To apply for assistance, contact MidPenn Legal Services, 213-A North Front Street, Harrisburg, PA 17101-2240, (717)232-0581 or (800)932-0356. You can read or hear more about the pilot program, which was first announced by the PUC at a press conference on October 19, 2009.

PUC Reports Show
Increases in Terminations: Concerns for Low-Income
Customers Continue

Third Biennial Report
Act 201 of 2004, known as Chapter 14, went into effect on December 14, 2004, amending the Public Utility Code. The Public Utility Commission 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 Third Biennial Report was released January 14, 2011. While concluding that the “utilities have successfully implemented Chapter 14 since its passage in Dec. 14, 2004,” (p. i) the following issues, documented by the Commission, are cause for concern in regard to low income customers:

Access to Service:

  • “[M]ore customers now enter the winter without a central heating source and the Commission is concerned about the health and safety of the occupants in these dwellings.” (p. i)
  • From 2004-2009, terminations increased 78.6% for the electric industry and 45.5% for the gas industry. While a corresponding increase in the reconnection rate has helped maintain reasonable access to utility service, “overall these results show that more Pennsylvanians are without electric and gas service since the passage of Chapter 14.” (p. 48)

Economic Conditions:

  • The purchasing power of all consumers is affected by the current poor economic climate, utility base-rate increases, and the lifting of all rate caps.   And because of the economic downturn, more and more consumers have less income to pay their bills. The Commission has noted that, statewide, the percentage of Pennsylvania households at or below 150 percent of the Federal Poverty Level has increased from 19 percent in 2000 to 25 percent in 2008. (pp. 32-33)

Collections:

  • The collection process for customers begins when they do not pay their bills in full and on time.  Overall, the collections performance for the electric industry continues to deteriorate. “Of particular concern, a larger portion of the customer debt is not covered under a payment agreement and, as such, poses a great collections risk.” (p. iii) 
  • While the percentage of electric residential customers in debt declined by 4.4% prior to Chapter 14 (2002-2004), that percentage increased 7.2% from 2004-2009.  “Looking ahead, the Commission is concerned about the collections performance of the electric industry as rate caps are lifted for Met-Ed, PECO, Penelec and Allegheny on Dec. 31, 2010. While less than originally predicted, the increases in post-rate cap generation rates combined with additional base-rate increases are cause for concern – especially when combined with diminishing purchasing power for customers in the current economic climate.” (p. 32)

Access to the Commission:

  • Chapter 14 prohibits the Commission from establishing a payment agreement for customers who participate in a utility’s CAP (Customer Assistance Program). From 2005 through October 8, 2010 the PUC turned away 50,624 CAP customers requesting a payment agreement.  For non-CAP customers, Chapter 14 prohibits the Commission from establishing a second payment agreement if the customer has defaulted on the first, unless there has been a change in income. Since the passage of Chapter 14, the Commission has turned away over 67,195 non-CAP customers requesting a payment arrangement. (p. 51)

Utility Company Compliance with Chapter 14:

  • “For the most part, it appears that the utilities have brought their operations into compliance with the requirements of the Chapter, and the Commission is generally satisfied with the level of compliance demonstrated by the utilities. However, there are instances of non-compliance, as evidenced by the number of informally verified infractions found by the Commission relative to the electric, gas and water industries and alleged infractions shown in the list of formal settlements resulting from informal investigations of the Commission’s Prosecutory Staff. ” (p. 10)
  • The Commission’s Law Bureau Prosecutory Staff may decide to continue to conduct investigations into an alleged infraction; this investigation may result in a formal settlement between the responsible utility company and the Prosecutory Staff.  Since the issuance of the First and Second Biennial Reports, when six settlements related to alleged chapter 14 violations were acted upon, the Commission has acted on seven more settlements involving possible violations of Chapter 14. In 5 of the 7 settlement cases, improper terminations may have been the cause of subsequent fires and deaths or injuries. (pp. 6-10) While compliance issues related to improper service terminations existed before Chapter 14, the “Commission continues to be concerned with unlawful or erroneous terminations, which present serious issues of health and safety for both the individuals directly involved and the surrounding community.” (p. 10)

PUC Releases Annual Cold Weather Survey for 2010
The Cold Weather Survey, mandated by Public Utility Commission regulations, is undertaken each fall; all PUC-regulated natural gas and electric utilities are required to survey residences where service has been terminated throughout the year and not reconnected. Utilities must make four attempts to contact these terminated households, via certified letters, phone calls, and personal visits.

  • On December 15, 2010, a total of 17, 294 households normally using electric or gas heat were without service after completion of the survey (excluding vacant residences and households using potentially unsafe heating sources or other central heating sources) – an increase of almost 2% from 2009 to 2010. Households heating with electric fared much worse than those heating with gas. From 2009 to 2010, the number of electric-heated households without service increased 19% while the number of gas-heated households without service declined 3%.
  • 13,055 residences where electric service was terminated now appear to be vacant, while 6,268 residences where gas service was terminated now appear to be vacant.
  • The number of households using potentially unsafe heating sources increased 83% from 2009 to 2010 for households using electric, while declining 43% for those using gas.
  • By February 1, 2011, 51% of those households without electric service in December continued to be without electric service and 76% of those households without natural gas service in December continued to be without gas service.

The PUC provides a breakdown by utility company for those interested in more specific results of the Survey.

See:

http://www.puc.state.pa.us/general/publications_reports/pdf/Cold_Weather_Results_2010.pdf for December Survey results.

See:

http://www.puc.state.pa.us/general/publications_reports/pdf/Cold_Weather_Results_2010-2.pdf for results from the Cold Weather Re-Survey dated February 1, 2011.

In order to improve access to central heating systems, the Public Utility Commissioners urge consumers without heat to learn about what protections might be available to them to help restore service; to contact their utility company to make a payment arrangement and to learn about weatherization programs to help reduce bills; and to contact the PUC for possible assistance if an arrangement cannot be made with their utility.

Summary and Necessary Actions for the Future

  • Since the passage
    of Chapter 14 in late 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 Customer Assistance Programs (CAPs) and other low-income
    utility programs, including LIURP (Low-Income Usage Reduction
    Program), CARES (Customer Assistance and Referral Evaluation
    Services) and Hardship Funds must continue to increase and outreach
    to low-income consumers must be improved in order to enroll
    all those who are eligible, especially as the economy worsens. As the Commission states, “Low-income households that are placed into CAP and successfully manage to pay their CAP bills represent the success of the program.” (p. iv)

PULP is advocating for the following essential protections for
low-income consumers:

  • The Commission should adopt as its policy
    and the policy of utilities the avoidance of service terminations
    wherever possible.
  • CAP payments should be required to be affordable, based upon affordable energy burden level. (Energy burden is defined as energy costs as a percent of household income.)
  • 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.

Energy Conservation/Weatherization Legislation and ACT 129

On October 15, 2008, when former Governor Edward Rendell signed House Bill 2200 into law as Act 129, Pennsylvania leaped to the forefront of energy conservation and demand reduction activities in the country. The Act mandates significant reductions in retail electricity consumption through the installation and use of energy efficiency and demand reduction measures by ratepayers with the assistance of electric distribution companies and at the direction of the Pennsylvania Public Utility Commission. The resulting reductions in energy usage should yield monetary and environmental benefits for all the state’s citizens.

EE & C Plans

Act 129 directed that by July 1, 2009 all electric distribution companies with at least 100,000 customers were to develop and file an Energy Efficiency and Conservation and Demand Side Reduction Plan (“EE & C Plan”). PULP has been an active participant in the Plan development process for each of the 5 utilities required to file a Plan – Allegheny Power, Duquesne Light Co., First Energy Companies (Metropolitan Edison, Pennsylvania Electric, Pennsylvania Power), PECO, and PPL.  Because Act 129 requires that the EE&C Plans provide specific energy efficiency measures for low-income households, PULP has advocated strongly on their behalf, participating in stakeholder meetings with the utilities and filing comments, testimony, and briefs with the Pennsylvania Public Utility Commission.

Smart Meter Plans

Act 129 also directed that the same electric distribution companies must file a Smart Meter Technology Procurement and Installation Plan (“Smart Meter Plan”). There will be new costs to consumers associated with the implementation of smart meter technology, and many of the new services associated with the meters, including remote reconnection/disconnection, service limitation, and prepayment options, have the potential to place low-income families at risk of losing service. PULP has therefore submitted comments and testimony, as sought by the Commission, reviewing each utility’s Plan and how low-income households might be affected.

Rate Cap Expirations

More Pennsylvania consumers may soon be experiencing electric rate shock; and low-income utility customers will be among those hardest hit.  The Commonwealth restructured its regulated electric distribution companies (“EDCs”) in 1996 with the passage and enactment of the Electricity Generation Customer Choice and Competition Act (“the Act”).  66 Pa.C.S. § 2801 et seq.  Safeguards were built into the Act in the form of generation rate caps to allow the market to mature and to protect consumers if prices did not decrease as expected.  Over the ensuing years, the cost of generating electricity has increased substantially due to a variety of factors, primary among which is the increase in the cost of fuel.  However, the impact on customers has been muted because generation rate caps prevented EDCs from passing on this cost to the customer.  This reprieve has ended.

Generation rate caps for all Pennsylvania EDCs expired on December 31, 2010, and the overall cost of electricity for retail customers increased in most service territories. 

The Alternative Energy Investment
Act

Former Governor Rendell signed into law the Alternative Energy Investment
Act (AEIA), Pa. H. Bill No. 1, Printer’s No. 86 on July
9, 2008. The law provides a $650 million package of loans,
grants, and tax credits to spur residential and business investment
in alternative energy, energy efficiency, and energy conservation.
It also includes $40 million for an Emergency Energy Assistance
Fund.

The AEIA creates a series of different funds targeted to different
constituencies and to different types of alternative energy
approaches including:

  • The Alternative Energy Development Program
    will make available $500 million in loans and grants to residential
    and business customers to spur investment in, development of,
    and use of alternative energy sources.
  • The Consumer Energy Program will make available $100
    million for conservation and fuel efficiency projects.
  • The
    Alternative Energy Production Tax Credit Program will make
    available $50 million in tax credits for qualifying projects
    related to energy efficiency.
  • The Emergency Energy Assistance
    Fund will receive $10 million annually for fiscal years 2008
    through 2012 for emergency energy assistance to be administered
    by the Department of Public Welfare in the event that the
    Governor declares an energy emergency due to weather conditions
    or energy costs or a combination of both.

Several agencies and authorities have been charged with promulgating
regulations and implementing programs as a result of the AEIA,
including the Commonwealth Financing Authority, Department
of Public Welfare, Department of Environmental Protection,
and Pennsylvania Housing Finance Authority.

Changes at the PUC

The Pennsylvania Public Utility Commission (PUC) is comprised of five Commissioners, one of whom serves as Chairman and one as Vice Chairman. On February 24, 2011, Governor Tom Corbett appointed Robert F. Powelson of Chester County as Chairman, replacing James H. Cawley, who had been appointed Chairman by former Governor Rendell in August of 2008. Powelson has been a PUC Commissioner since June, 2008. He previously served as the president of the Chester County Chamber of Business & Industry and was recently appointed as co-vice chair of the National Association of regulatory Utility Commissioners (NARUC), Committee on Water.

Tyrone J. Christy is Vice Chairman of the Commission, having been elected by his colleagues to that position in August, 2008. His term expires at the end of March, 2011. Christy also serves on the Board of Directors of the Organization of PJM States Inc. (PJM is a regional transmission organization coordinating the movement of wholesale electricity in all or part of 13 states and Washington, D.C.)

The most recent member of the Commission, John F. Coleman, Jr., was nominated by former Governor Rendell and approved by the PA Senate in June, 2010. He replaced former Commissioner Kim Pizzingrilli. Coleman was formerly the President/CEO of the Chamber of Business and Industry of Centre County.

Cawley, the immediate past Chairman, is serving a second 5-year term ending March 31, 2015.  He is an Adjunct Professor of Administrative Law at Widener University School of Law and teaches courses on appellate advocacy, public utility law and ethics for the Pennsylvania Bar Institute.

Wayne E. Gardner was nominated by former Governor Rendell in June 2008 to a 5-year-term scheduled to expire April 2013. Commissioner Gardner serves on the board of directors for the Environmental Quality Board, the Mid-Atlantic Conference of Regulatory Utilities Commissioners (MACRUC), and the Electricity Committee of the National Association of Regulatory Utilities Commissioners (NARUC).

All correspondence and filings before the Commission are addressed to its Secretary, Rosemary Chiavetta, who began serving in that role April 26, 2010, replacing James J. McNulty, who retired. As prothonotary of the Commission, Secretary Chiavetta is responsible for the acceptance of filings and the docketing, retention, and retrieval of all documents. All official actions and decisions are issued over the Secretary’s signature.

For more information about the Commissioners, visit the PUC’s website at http://www.puc.state.pa.us/general/MeetCommissioners.aspx.