2. Background
On June 19, 2009, The Utility Reform Network (TURN) filed a Petition to initiate a rulemaking (Petition) to address arrearage management and shutoff prevention for residential customers. (Petition (P.) 09-06-022.) In response to TURN's Petition, a proposed decision issued on September 25, 2009, which examined the existing low-income programs that are available to low-income customers, evaluated whether the utilities are performing outreach and education on the availability of the low-income programs, and considered whether any additional programs are necessary at this time. Upon initial examination, the proposed decision determined that existing programs and outreach were sufficient and that a rulemaking was not needed at this time.
On November 19, 2009, the Division of Ratepayer Advocates (DRA), who strongly supported TURN's Petition, released a report, "Status Report on Energy Utility Service Disconnections," that discussed data regarding service disconnections and reconnections from January 2006 through August 2009. Based on the data contained in DRA's Report, President Peevey announced that the Commission would hold an en banc on December 17, 2009.
Commissioners Peevey, Grueneich, Bohn and Simon participated in the en banc and listened to presentations from DRA, TURN, Greenling Institute and the four major utilities. From the en banc discussion, the Commission learned that the disconnection rate was rapidly rising for low-income households. In addition, the utilities reported that a very high percentage of customers who are disconnected are reconnected within 48 hours.
Following the en banc, all four utilities agreed to a moratorium on service disconnections beginning December 21 and extending through January 5.2 The reasoning behind the moratorium was to enable customers and the utilities to have time to contact one another about arrearage repayment without fear of a disconnection during the holiday/winter period.
The Commission then held a workshop on January 5, 2010 to afford the utilities and other stakeholders an opportunity to discuss "best-practices" for customer outreach and education so that customers can address repayment of arrearages before they are disconnected. The emphasis by the Commission was on having the utilities work within their communities to get the word out that customers having difficulty paying their utility bill should immediately contact their electric or gas company to discuss how to best repay the arrearage, prevent disconnection, and see whether there are ways to decrease the monthly bill through assistance programs or energy efficiency efforts.
The Commission had envisioned that through the en banc and workshop efforts that the utilities could individually, or jointly, develop innovations to their current bill collection practices that would assure the Commission that bill arrearages and disconnections were being thoroughly addressed by the utilities resulting in fewer residential disconnections. However, the Commission now believes it is appropriate to open a rulemaking to gather input from the utilities and consumer groups on ways to decrease the number of household disconnections while at the same time not shifting the burden of non-paying customers to other ratepayers.
2 SCE voluntarily extended their moratorium through January 21, 2010.
