Assisting Income-Eligible Customers Remains Priority for Natural Gas Utilities
In the wake of energy bill passage, significant relief from price volatility still in the future
Tracey Lynn Shifflett (202) 824-7211 August 2005
Daphne Magnuson (202) 824-7205 FYI-LIHEAP 2005
Washington, D.C. – Natural gas utilities are preparing for the possibility of a winter of high natural gas prices by making aggressive efforts to reach out to income-eligible customers and help them manage their energy bills, according to the American Gas Association (AGA). In recent years, natural gas prices increased as a result of a decade of policies that encouraged the use of natural gas, yet discouraged exploration and production of the fuel. This year marked the enactment of a new national energy policy that will eventually help bring natural gas prices down by allowing supply and demand to correspond, however experts say it will take time for the new policies to provide significant relief from rising natural gas prices for millions of natural gas customers across the nation.
“Natural gas utilities recognize the hardship higher home-heating bills place on all their customers, and are especially sensitive to the predicament volatility places on residential customers who are already struggling to make ends meet on all of their expenses,” said David N. Parker, AGA president and CEO. “Utilities work closely with community groups, charities and social service agencies to give income-eligible customers more options. With programs that arrange budgeted payments, put customers in touch with social service agencies and educate them on improved energy conservation efforts that will help lower their energy bills, natural gas utilities help customers manage mounting energy costs.” Parker said.
AGA says natural gas utilities provide extra assistance to their low-income customers by:
- Partnering with charities, churches and community organizations to raise funds to help pay their energy bills;
- Offering a variety of payment assistance programs; and
- Offering programs to educate customers and help them weatherize their homes and manage their energy use.
Examples of some of the ways natural gas utilities reach out to their income-eligible customers follow.
Fuel Funds and Programs
According to figures from the National Fuel Funds Network and the LIHEAP Clearinghouse, approximately $87 million was raised by fuel funds to help low-income households meet their home energy costs in 2004. Traditionally about 25 percent of those funds comes from energy utilities. In addition, energy utilities contribute many millions of dollars toward paying the bills of income-eligible customers through regulator-approved forgiveness and waiver programs. (More information is available at: www.nationalfuelfunds.org and www.liheap.ncat.org/). Following are just a few examples of the more innovative natural gas utility programs to raise money for fuel funds:
- Alagasco (AL) offers some of its low-income customers a “No Customer Charge.” Customers who receive Supplemental Security Income (SSI) or Family Assistance can take advantage of the program and avoid a regular monthly customer charge. To apply for the program, customers simply take their award letter or verification to their local utility office or community action agency. The Alabama Department of Economic and Community Affairs Office, which administers LIHEAP dollars uses this amount each year toward a Leveraging Grant Award which brings more LIHEAP dollars to the state. For more information on the program, click here.
- Atmos Energy (TX) developed an energy assistance agency page on their website that enables LIHEAP, Commissions and private energy assistance agencies to make pledges to income-eligible customers in real-time, 24 hours a day. The website gives these entities access to specific account details for customers who are applying for LIHEAP or private funds. The account details include billing history, payment history, consumption history and account status, etc. The secure webpage enables pledges to be made to a customer’s account immediately, removing the customer from the delinquency process based on amount pledged and provides many other agency specific services. Atmos has found the results from this proactive website page has resulted in a substantial decrease in call-center costs, as well as an increase in their fuel funds. To find out more information on Atmos’ energy assistance website, visit: www.atmosenergy.com.
- DTE Energy, Consumers Energy, Aquila, Inc. and SEMCO Energy have teamed up for the past two winters to raise funds for Michigan’s “The Heat and Warmth Fund (THAW).” The utilities participate in a “Winter Survival Radiothon” in January each year to raise awareness of the need for energy assistance, and accept donations from listeners. This year’s 30-hour radiothon raised more than $210,000, and will be matched by the utilities, as partners in THAW. In February 2005, THAW also threw a dinner gala and silent auction — The Night of Warm Hearts Gala — to raise nearly $230,000, which will also be matched by the utility partners. To learn more about the gala, click here. To learn more about THAW, click here.
- Nicor Gas (Naperville, Ill.) offers the “Sharing Program,” which provides one-time annual grants of $150 to low-income residential customers. Administered by the Salvation Army, the program is funded through direct contributions from Nicor Gas customers and employees. Customers have the option to make a donation through their monthly gas bill, and Nicor will match these contributions dollar-for-dollar, up to $200,000. For more information on this, click here.
- Vectren Energy Corp. and Citizens Gas and Coke (IN) have teamed up to create a new Universal Service (USP) program in Indiana. This two-year pilot program began on January 1, 2005. It automatically enrolls customers who qualify for LIHEAP and assists them with a 15, 26 or 32-percent discount on their monthly bill, depending upon household income. The program was developed in conjunction with the Indiana Office of Utility Consumer Counselor and approved by the Indiana Utility Regulatory Commission. To learn more about the program, click here.
Peoples Energy (Chicago, IL) launched their "Team H.E.A.T (Home Energy Assistance Together)" program in October 2004 to better educate the public about the benefits of weatherization. More than 160 employee volunteers weatherized 100 low-income customers' homes over a weekend, installing plastic sheeting, weather stripping and caulking around windows and doorframes. The event heightened awareness about ways consumers can control their heating bills and garnered extensive media coverage. In the past, the company couldn’t give away weatherization kits, but this year, the company was overwhelmed with requests for kits. The company plans to do an enhanced Team H.E.A.T. event in October 2005, when it will weatherize 150 homes. To learn about Team H.E.A.T, click here.
KeySpan Energy/New England (MA, NH) developed an online home energy analyzer for their customers as part of its $15 million per year “energy management” campaign. In 2004, the company determined that 84 percent of incoming customer service calls from non-English speakers came from Spanish-speaking customers. To better reach their tremendous Hispanic customer base, KeySpan New England launched their convenient online energy analyzer in Spanish as well. This internet-based tool offers customers a free analysis of their home energy use and energy and money-saving tips in English and Spanish. For more on the home energy analyzer, click here. To view the “Spanish Analyzer,” click here.
WE Energies (WI) offers an “online energy report” that gives its customers a 24-month analysis of their average electricity and natural gas usage. The report gives customers their energy profile by breaking down usage and cost per day by month and by year for the previous two years. The convenient one-page personalized energy report also gives cost-per-day comparisons between energy and other energy products and services, such as phone and cable, and energy efficiency tips and programs offered by the utility. To view a sample of the personalized energy report, click here.
Public Service of New Mexico (NM) provides online weatherization tutorials via video clips on their website for customers who may not be familiar with how to weatherize their home. There are video demonstrations in both English and Spanish of caulking, installing weather stripping, programming a thermostat, replacing furnace filters, placing temporary plastic on storm windows, installing permanent storm windows and applying water heater blankets. In the past, the company has also given customers the option of receiving these tutorials on DVD. To view the videos, click here.
Other Energy Assistance Programs
In addition to fuel funds, energy audits and weatherization assistance, natural gas utilities also offer an array of energy assistance programs to needy customers. These vary from utility to utility, but typically include arrearage forgiveness programs, flexible payment plans, discounts based on income and ability to pay and moratoria on disconnection during winter months.
Specific examples include:
- Alliant Energy (WI) offers its customers a convenient way of purchasing the gift of energy for friends, family, clients, employees or customers with an online gift certificate. The gift certificate can be purchased for any amount online with a credit or a debit card, and the recipient of the gift receives a “CertifiCheck” in the mail. The buyer can also personalize the gift check. The recipient can submit the gift check with an accompanying bill to apply towards their account. The service is also offered via telephone purchase. For more information on this gift program, click here.
- Metropolitan Utilities District (NE) partners with the United Wayto offer income-eligible customers a financial counseling servicebetween January and March. Those customers who have received shut-off notices are able to meet with a United Way representative in MUD headquarters to get assistance with payment plans and other available programs. The utility has offered this program formore than 20 years; and since 2001 has assisted over 3,000 households. For more information on this program, visit: www.mudomaha.com.
- New Jersey Natural Gas (NJ) partners with Princeton eCom, for their “Collectpay Direct” program. This program offers customers the option of paying their natural gas bill online or via phone with a credit or debit card. The secure and convenient service requires a small fee be paid. NJNG also offers helpful notification services for customers who may have difficulty in paying their bills. This service sends a customer-designated third party (friend, relative or social service agency) a duplicate copy of any discontinuance or nonpayment notice. The third party is not held responsible for the bill, but the notification may give income-eligible customers another option. For more information, click here.
- PECO, An Exelon Company (PA), offers many low and fixed-income programs through its Universal Services department including the CAP Rate and the Low Income Usage Reduction Program (LIURP). CAP is a discounted residential tariff rate for low-income PECO customers. There are five discounted electric rates and two discounted natural gas rates available. The percentage of discount is based on total gross household income. LIURP helps low income consumers use natural gas and electricity more efficiently, thus reducing their energy use and monthly bills. Through LIURP, weatherization measures are installed in customers' homes and conservation education is given. The program is free of charge. For more information on CAP and LIURP, click here.
- Yankee Gas (CT) offers a “Matching Payment Plan Program,” which allows low-income customers who have past-due balances to work out a monthly payment arrangement so their gas heating service will be provided all year round. Qualifying customers may also have the possibility of forgiveness of back balances owed. Yankee Gas deducts an amount equal to the money paid by the customer and the amount received from energy assistance applied to their account, up to a zero balance. The company meets annually with the local electric utility and social service providers to develop the most effective ways to make low-income and hardship consumers aware of this and other energy assistance programs available to them through a variety of utility-sponsored, public and private sources. For more information on the Winter Protection Plans, click here.
The American Gas Association represents 195 local energy utility companies that deliver natural gas to more than 56 million homes, businesses and industries throughout the United States. Natural gas meets one-fourth of the United States’ energy needs.
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