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MA DPU Dismisses Low-Income Prepayment Pilot

The Massachusetts Department of Public Utilities (DPU) last week dismissed a proposal by Western Massachusetts Electric Company that would have piloted the use of prepayment meters among the company’s low-income customers.

The proposal was opposed by the Massachusetts Attorney General, state energy officials, and low-income energy advocates who said it would threaten electrical service for hundreds of low-income families and allow the utility to bypass the state’s existing consumer protection rules.

With prepayment meters, customers purchase electricity in advance and once it runs out their utility service may be disconnected. Participants may also use an in-home display unit that provides them real-time information such as consumption, cost, and available balance of electricity.

The DPU agreed with advocates that the program would circumvent Massachusetts’ consumer protection laws and said that it unfairly targeted low-income consumers. It ordered the utility to come up with a revised pilot program that includes all income classes within 90 days.

The pilot program would have enrolled 600 to 800 low-income households in the Springfield area. Some would have used prepayment meters; others would have been enrolled in an inclining block rate program, where they would pay a discounted rate for their first 300-kWh block of power and a higher rate for additional consumption.

The proposal was prompted by the state’s Green Communities Act of 2008, which requires utilities to conduct pilot programs to test how so-called “smart grid technologies,” which include prepayment meters, can help consumers cut energy use.  The utility said the pilot was designed to reduce energy consumption.

Source: DPU, Boston Globe