XVII. Reduced Rates for Low Income Customers
ORA recommended that AVR establish a reduced rate program for low-income customers on the basis that Section 739.8 of the Public Utilities Code requires the Commission to consider rate relief programs for low-income ratepayers. ORA's proposed program would provide a 50% service charge discount for residential customers who meet federal poverty guidelines. This means that one or two-person households with a household income level of $22,000 or less would qualify for the discount. Larger household sizes with threshold incomes at unspecified higher income levels would also qualify. ORA also recommended that AVR establish a memorandum account to track revenues and expenses associated with this program so that AVR may recover program costs and lost revenues from its other customers in the future.
ORA's proposal is premature because it did not conduct any study to determine the feasibility of its proposal, let alone know what percentage of AVR customers would qualify for the proposed program. However, it conceded that if a disproportionate percentage of customers qualify for this program, the program would be impractical and should not be implemented.47
Based on the evidence in this proceeding it is impossible to evaluate whether ORA's reduced rate program for low-income customers is practical or would create an undue economic burden on AVR's remaining customers. At the very least, customer demographic information is needed to assess the viability of such a program. Absent such information we must reject ORA's proposal. However, we are interested in programs that provide reduced rates for low-income customers. Therefore, AVR should gather demographic information about its customers and study the feasibility of offering reduced rate programs for its low-income customers and include those results in its next GRC filing.
