Thursday, April 09, 2009

PSC Reports on Devastating Termination Statistics

At the New York State Public Service Commission (“PSC”) monthly agenda meeting on April 7th, the Director of the Office of Consumer Services provided an update on the winter heating season’s termination statistics by the electric and natural gas utilities. The PSC Chairman thanked the energy utilities for going “above and beyond” what is required by law with regards to their cold weather disconnection policies. These policies prevented terminations on days where the air temperature drops below 32 degrees.

Nonetheless, service to more than 330,000 New York customers and their families was interrupted by the utilities in 2008 as a collection effort, probably affecting the lives of more than one million persons, and increasing the risk of harm from lack of safe service. See Candle Fires: A Symptom of "Rolling Blackouts" Affecting Low-Income Households.

The Commission heard some sobering statistics:

(1) For the just concluded winter heating season (November 1st through February 28th), the number of customers with arrears over 60 days rose eight percent from the same period last year.

(2) The amount of money owed by the customers with arrears over 60 days jumped 19 percent from last year, to over $587 million.

(3) Final termination notices were up 16 percent from last year.

(4) The number of active deferred payment agreements grew by nine percent.

(5) Total terminations were up 19 percent for all of calendar year 2008 over 2007, even with a nine percent reduction in terminations during the winter heating season due to the cold weather disconnect policies.

(6) March 2009 represented the eighth consecutive month of double digit increases in calls to the Commission’s call center.

Although the economic downturn is a major factor in the growing number of customers who cannot meet their payment obligations, there are many measures still to be taken by the PSC to address the problem. For example,
  • reform of its policies which currently favor volatile pricing and unpredictable bills;
  • ratemaking reforms such as inclining block rates and low income rates; and
  • more vigorous enforcement of HEFPA.
Also, as we recently pointed out, if New York did even half as well as California in enrolling eligible low-income telephone customers in the Lifeline discount rate program, they would have $100 million in cost savings that could help ends meet in their constricted family budgets.

Lou Manuta

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