Rising prices may dim the lights

PHOTOGRAPHER: Sara Foss

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At the Schenectady Community Action Program, they’ve started to call and trickle in, disconnection notices in hand.

Since the federal Home Energy Assistance Program closed down in May, an average of 10 people a week are seeking help with unpaid utility bills from SCAP’s Community Crisis Network. If they don’t receive help, they are likely to have their utilities disconnected.

Utility shut-offs occur every year, usually after winter is over. But this year, officials are expecting a higher number than in the past, the result of a dismal economy and high utility and fuel prices, and SCAP is carefully tracking how many people contact the organization for aid. Though so far the numbers aren’t much different than the year before, officials are expecting the worst.

“We do think, anecdotally, that it’s going to become a bigger issue,” said Deb Schimpf, executive director of the Schenectady Community Action Program.

Negative trends

Data from the New York State Public Service Commission suggest that it could be a bad year.

From January to March of this year, 936,607 residential accounts throughout the state were in arrears more than 60 days, compared to 872,759 in 2007, a 7.3 percent increase. In dollar terms, residents in arrears more than 60 days owed $499 million during that three-month period, compared to $425 million in 2007, a 17 percent jump.

According to the Public Service Commission, the amount owed in arrears is the highest ever.

In an e-mail, PSC spokesman James Denn noted that utility rates and sales are also the highest ever.

“There are several factors which we believe affect utility arrears,” he wrote. “In the past several months, consumers have experienced a mortgage crisis problem, record high gasoline costs, increasing food costs, increasing energy costs and a rise in the consumer price index. All these factors affect the family cash flow and have played a part in contributing to the increase in utility arrears.”

These are tough times for low-income consumers, said Gerald Norlander, executive director of the Public Utility Law Project.

“You get to the end of the line, where people don’t have any money and their utility is properly terminated,” he said. “There’s no medical emergency. There’s no one else in the house. They’re at the end of the road, and they’re not going to have service.”

Pressing for action

During the past several years, more National Grid customers have received disconnection notices.

“Over the last 12 months, we’ve seen an upward trend in residential uncollected bills,” said Patrick Stella, a spokesman for the company. “Those numbers have gone up throughout our service territory.”

Last month, National Grid applied to the state Public Service Commission for a rate increase for the cost of distributing natural gas, the first such rate hike since 1996.

Included in the proposal is an expansion of National Grid’s assistance to low-income customers, Stella said. It would establish a delivery rate discount of $5 per month for customers whose income falls below certain government-specified poverty thresholds; expand the arrears credits available under its affordability program, which combines energy efficiency efforts, education, weatherization, payment agreements and arrears forgiveness for certain low-income customers; and offer an incentive payment to income-qualified elderly, blind, disabled and life-support customers who have not received HEAP assistance to do so in the future. National Grid is also proposing the establishment of permanent energy efficiency programs for low-income customers.

There’s no law prohibiting utilities from disconnecting customers who are in arrears during winter, but they tend to wait until winter is over to do so.

“Utilities use termination of service as a collection tool,” Norlander said.

Bleak outlook

Once HEAP, which assists low-income residents with heating costs, closes down for the season, people can apply for county assistance. Through the state’s emergency utility assistance program, counties provide welfare recipients with grants to pay off their utility bills; low-income people who are not on welfare receive loans that must be repaid in full. If a previous loan has not been repaid, a person is ineligible for assistance, no matter how needy they are.

Norlander said this rule puts people at risk.

“More people are going without service for a greater period of time,” he said.

Since March 30, 22 shutoff notices have been issued for residents of Schenectady County, according to Dennis Packard, Schenectady County commissioner of social services.

“I’m very concerned,” he said. In the current economic climate, “demand for emergency assistance can only go in one direction.”

Ann Black, deputy executive director of the Fulmont Community Action Agency, a nonprofit organization that aids low-income residents in Fulton and Montgomery counties, said that so far, the number of people seeking help with disconnection notices is on par with last year. But she expects that to change.

“Do I expect more people to get behind? Yes, I do, because of what is going on with the economy and the price of gas,” she said.

Paul Brady, Schoharie County commissioner of social services, said his agency hasn’t yet seen an influx of residents needing assistance with their National Grid bills.

“We’ve had no calls, no people coming in to apply for assistance,” he said.

This year, the state offered two emergency HEAP benefits to help households that exhausted their HEAP benefits earlier in the winter. The second benefit allowed the program to remain open until May 15. Last year, there was only one emergency extension of HEAP, which meant that last year at this time, Schenectady County was already using its public assistance funds to help low-income utility customers, Packard said. This year, there are more resources for helping needy customers.

Help from PSC

Denn outlined the steps the Public Service Commission is taking to help customers. These steps include:

u Each fall, PSC staff meets with the utilities and asks them to work closely with customers who are in arrears and offer flexible repayment terms to the elderly and disabled.

u The PSC encourages utilities to promote their budget billing programs; these programs allow customers to spread the entire cost of their utility bills throughout the year so that they are not stuck paying large winter bills when they are issued.

u Consumers who are having difficulty making a payment to their utility may seek assistance from the Public Service Commission’s Consumer Services Staff; staff will work with the consumer and the utility to negotiate a reasonable repayment plan.

“It’s always better, if you’re having trouble, to contact us as early as possible so we can set something up as early as possible,” Stella said.