Tuesday, September 05, 2006

Candle Fires: A Symptom of "Rolling Blackouts" Affecting Low-Income Households

The essential nature of electricity service in our society is often taken for granted. When a geographic area blackout occurs, due to grid failures or storms, it is major news when large numbers of people are simultaneously without power for a few hours. A "rolling blackout" occurs when electric grid operators deliberately shut power off to geographic areas on a rotational basis while a system-wide energy deficiency is being corrected. These outages are deliberately rotated in order to shorten the time customers are without power.

A less publicized, less visible, but more serious "blackout" affects many thousands of low income people every day throughout the nation, when utility trucks and crews roll through low income neighborhoods to disconnect service for non payment.

These less noticeable deliberate “blackouts” of selected customers last days rather than hours, and are resolved only when the customer makes payment arrangements or receives assistance from to pay what the utility demands. Some customer "blackouts" due to non payment may continue for weeks or months. This has to be deleterious to family life, and it is difficult to imagine how anyone, particularly children, can thrive in a situation without heat or light in the home.

The scope of these "blackouts" may affect even more customers as energy prices rise beyond the ability of low income customers to pay them, due to increased fuel costs and rising environmental costs. If utilities are allowed to continue existing collection policies, and if regulators continue to ease or "streamline" their rules to allow utilities to use service denial or interruption as a bill collection tactic, the situation will worsen.

Fires Common When Electricity is Off
The tragic 2006 death of six Chicago children in an apartment without electricity, where candles apparently had been used for months, illustrates a rather common situation. For example,
  • An August, 2006 fire in a candle-lit Rochester, New York home without electricity:
    Candles left burning caused an overnight fire. It was not an act of carelessness on the part of the homeowner, but one of necessity. [The homeowner] was laid off, and unable to keep up with bills. She spent the summer without electricity.
  • The 2005 death of a New York City child in a fire started by a candle while power was shut off. It was reported that the customer had made payment arrangements sufficient to be reconnected, the reconnection was scheduled for the next day, but the fire occurred during the intervening night:
    "[A] Con Ed spokesman ... confirmed electricity to the apartment had been cut off at 1:45 p.m. Monday. Two hours later, [the customer] appeared at a local Con Ed branch to pay $700 - almost half the outstanding bill. [A]n order to restore electricity within 24 hours was issued two hours later. Tragically, it was not in time - firefighters responded to the scene of the fatal fire at 10:45 p.m."
  • In a 2003 Syracuse, N.Y. incident,
    "A Syracuse mother and her three children, who have been using candles to light their home since the power was shut off earlier this month, escaped unharmed when a candle ignited a blaze in a second-floor bedroom Friday morning.... [A] NiMo spokesman said the company disconnects the power when a customer is unresponsive to letters, calls and offers of payment agreements. He said company officials had a phone conversation with the customer Thursday to discuss the bill.
  • In 2005, after state laws were changed to make utility terminations easier, four Pennsylvania residents without electricity died in a candle fire
    • "[The]director of the [Pennsylvania] PUC's Bureau of Consumer Services, said what was missing in the new law was the old requirement that Penelec go to the house 48 hours before shut-off. That requirement meant that a utility employee had to personally notify the customer and to leave notice tacked to the door if no one was home. As things turned out, that change probably was critical. That, and the failure of [the customer]to demand a medical deferral from shut-off because of ... chronic-health problems. They said they didn't know they could get such a deferral.... Penelec programs a computer to determine nightly which customers' service should be terminated.... The idea is to reduce human error, and no manager signs off, he said. "
  • In all these cases, service was shut off or denied to low income households due to non payment of past bills, illustrating how a lack of safe utility service can lead to life-threatening emergency situations.

    Use of candles, of course, is not limited to the poor, and neither are household fires. The widespread use of candles as the sole source of lighting for significant periods of time, however, is quite common in low income households during periods when electricity has been shut off as a collection measure. This increases risks, particularly to children, when less safe alternatives are used to meet basic human needs for energy.

    In addition to the tragic loss of life, injuries, and property damage, fires threaten the lives and property of neighbors, increase risks for firefighters and emergency service workers, lower community property values, and increase costs for public safety and insurance. The amount of arrears for which the utility service was terminated is far outweighed by the total cost to society of a fire.

    New York's Home Energy Fair Practices Act (HEFPA)

    The "blackout" or "outage" of a low-income customer for non payment of bills typically involves a component of customer default, but the decision to terminate service is a discretionary choice made by the utility. There is wide variation among utilities, and over time within the same utility in the degree to which service denial or termination is used to collect overdue bills.

    New York led the nation in 1981 with its enactment of a bill of rights for electricity and natural gas utility consumers, the Home Energy Fair Practices Act (HEFPA), which declares it to be the policy of New York state that continuous provision of electricity and natural gas service to residential customers
    "without unreasonable qualifications or lengthy delays is necessary for the preservation of the health and general welfare and is in the public interest."
    HEFPA included many reforms, including stringent requirements designed to minimize terminations for non payment and to keep service on without threatening financial stability of the utilities. Enforcement of HEFPA has been responsible for limiting the number of utility terminations in New York state and is relied upon every day by utility customers to obtain and keep service.

    New York's HEFPA law and regulations

    The New York Emergency Utility Assistance Program and HEAP

    In addition to enacting HEFPA in 1981, New York also enacted a unique public assistance program for households whose utility service may be terminated or denied due to nonpayment of prior bills for service, and who have exhausted their rights under HEFPA, for example, by breaking a minimum deferred payment agreement. This provides a necessary complement to the federally funded Emergency Low Income Home Energy Assistance Program (LIHEAP), known as “HEAP” in New York, which is seasonal and limited to heat-related emergencies. Significantly, the state assistance program is available as a loan to a customer who does not qualify financially for other public assistance programs. It is implemented by county departments of social services, and the cost is shared between the state and the counties.

    Will Utility Service Terminations Increase?
    Energy prices have soared in recent years. Households living on Social Security, public assistance, pensions, disability assistance or other fixed incomes have not seen their monthly incomes rise sufficiently to cover their increased energy costs.

    Encouraged by the New York Public Service Commission, some utilities adopted volatile commodity pricing methods that flow through rate spikes, which result in unexpected bill increases. Recent research shows that energy cost unpredictability creates very serious difficulties for customers trying to manage their household budgets, particularly the substantial number of households who lack savings or credit.

    Compounding the economic stress on households, some New York utilities have attempted to interpret HEFPA rules narrowly. For example, in 2003, with tacit approval from PSC staff, National Grid unilaterally changed its deposit policies and denied service to more than 1,000 applicants for service in the months before the practice was halted. In recent years, The New York Public Service Commission "streamlined" its HEFPA regulations "[i]n the interest of reducing regulatory requirements on utilities as utility service becomes more competitive" in ways that may increase the denial or discontinuation of utility service. In 2007, National Grid adopted harsh requirements for providing service to applicants with prior arrears, demanding up front payments of far more than applicants could afford.

    New York utilities with PSC approved multi-year rate plans do not have any service quality target to reduce the incidence of service termination as a collection tactic. Under these plans, utilities have the incentive to reduce services, maintenance, and costs and keep the savings for investment in their new holding company subsidiaries. Utilities may seek to reduce costs by cutting personnel who negotiate payment plans or assist vulnerable customers in accessing public assistance or LIHEAP benefits, and then rely more on field crews to shut service off as a collection measure. Also, as a cost cutting measure, utilities may seek to close community offices where payment plans and reconnections were previously arranged on a walk-in basis, and may rely more on telephone contact with customers, not all of whom have access to phone service (which may also be disconnected) or the ability to communicate and advocate with distant call centers to preserve their service.

    Meanwhile, the federal home energy emergency program, LIHEAP, remains limited, seasonal, and subject to major fluctuation in annual appropriations. When needy utility customers who have exhausted their remedies with the utility and the PSC (for example, by breaching a valid written deferred payment agreement and having no other claim for continued service), apply to local county departments of social services for energy assistance benefits to which they are entitled, there are instances of arbitrary or erroneous denials, possibly due to an effort to avoid county expenses for the portion of the assistance grant that is not borne by the state.

    As a result of changes in utility, regulatory, and financial assistance policies, in the coming years we may see more shutoffs of utility service to households that cannot afford it unless concerted efforts are made to improve the situation.

    PULP's Efforts to Achieve for Continuous, Affordable Utility Service
    PULP originally championed HEFPA and the New York state utility assistance program when the laws were passed in 1981. At the time, the death of children due to candle fires in the homes of low income customers and deaths of elderly persons in unheated premises where utility service had been shut off raised public awareness of the need to address harsh and unreasonable utility practices. See New State Legislation Urged on Gas, Electricity Shutoffs, Albany Times Union, Jan. 14, 1981. See also, Senate in Albany Votes Rights Bill for Utility Consumers, New York Times, July 3, 1981, recognizing PULP's role in framing the legislation.

    PULP continues to advocate for their enforcement and for improvements that will foster universal, affordable utility service. These utility and public aid systems are complex. Questions often arise concerning interpretation of regulations, tariffs, and practices concerning eligibility for deferred payment plans, service continuation for medical reasons, deposit requirements, billing disputes, shared meter responsibility, eligibility for federally funded HEAP or state funded financial assistance programs, and loans.

    The PULP Help Center offers general information about specific topics that affect the availability of continuous service. PULP has a telephone hotline (1-800-255-PULP) for consultation with advocatesfor customers in difficult cases, and PULP provides information to individuals when local advocates are not available and PULP resources permit. PULP also provides training programs for advocates on how to prevent utility terminations and how to access the public assistance and HEAP programs for utility customers unable to afford service.


January 16, 2008: See Streamlined Utility Shut-offs Have Turned Deadly for the Poor.

January 26, 2008. See Man Freezes to Death After City Limits Electricity.

October 10, 2008. See No Electricity: Middletown Residents in Critical Condition from Lantern Fire,

October 29, 2008: See Testimony in National Grid Natural Gas Rate Case Urges Low Income Rates and Reform of Utility Termination Practices

Jan. 5, 2009 3 die in fire at Detroit home where power was cut, Jeff Karoub, AP, Jan. 5, 2009.

Jan. 6, 2009: Importance of Continued, Affordable Energy Underscored by Detroit Fire Deaths After Electricity Shutoff, PULP Network, January 06, 2010.

Dec. 31, 2010: Will Kane, John King,Matthai Kuruvila, San Francisco Chronicle Staff Writers, Oakland fire tragedy: 'My mama's burning', "Oakland -- Fire on a frigid night tore through an East Oakland apartment, killing a mother, her daughter and a man who lived in an upstairs unit that had its power shut off earlier this month. Desperate for electricity, the mother and her two children had dangled a heavy-duty outdoor extension cord over their second-story balcony and plugged it into their downstairs neighbor's outlet. That jury-rigged electrical system - used to power lamps, appliances and strings of Christmas lights - sparked just before 2 a.m. Thursday and ignited a blaze in the apartment at 82nd Avenue and Birch Street that shot flames out of the second-story windows."

No comments: