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PA PUC Votes to Launch “Home Energy Burden” Study

March 24, 2017 – Pennsylvania Public Utility Commissioners have voted to explore the sensitive issue of how much low-income customers should be required to pay for monthly energy costs. State policy established in 1992 sets the limit at 17 percent of the household’s income.

PUC Vice-Chairman Andrew G. Place and Commissioner David W. Sweet say that the steady volume of complaints from low-income customers who are unable to keep current on their discounted payment plans suggest that the state’s limit for its customer-assistance programs “may be too high.”

"The Commission routinely considers complaints involving residents enrolled in CAP [customer assistance programs] programs failing to keep up with payments, accumulating arrearages, facing service disconnection and loss of program eligibility," noted Place in the joint motion proposing the study. "This payment, assistance and arrearage cycle is a recurrent issue for many low-income customers."

"The average Pennsylvanian spends 5 percent of their income on energy bills, while some low-income families experience an energy burden that is up to 30 percent of their income - even when factoring historically low energy prices," adds Commissioner Sweet. "This is why we need to revisit the equity and efficiency of Universal Service and Energy Conservation Programs, and a study examining the energy burdens of low-income Pennsylvanians is the best place to start." Chairman Place suggested a national average of 6 to 11 percent of household income “may be more appropriate.”

Commissioners John F. Coleman Jr. and Robert F. Powelson expressed concern that looking only at the energy burden for low-income customers ignored the broader implications of increasing subsidies to low-income households. The costs of those programs are typically paid for by other residential customers. According to Coleman, the cost of low-income subsidies increased from $63 million to $253 million between 2000 and 2015.

Coleman suggested that a more “comprehensive review” of the costs of customer-assistance programs was in order, “rather than the more narrowly focused study of energy burden.” The commissioners’ disagreement over the scope of the study was reflected in a 3-2 vote in favor of the one-year study focusing on the energy burden of low-income households.

Sweet noted a broader inquiry into assistance programs could be built on the more narrowly-focused study of energy burdens on low-income customers. He noted there was a plan to introduce a measure in April that would seek to launch a comprehensive review.