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Regulators bar electric companies from cutting off power June 1 to Oct. 15

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State utility regulators voted June 20 to block electric companies under their purview from shutting off power to residential customers who do not pay their bills from June 1 through Oct. 15.

Under the plan, Arizona Corporation Commission will require utilities to give those who fall behind up to four months after Oct. 15 to repay their outstanding balance. And it bars the utilities from charging interest or late fees.

The emergency rules also say that any customer whose power has been shut off since June 1 must be immediately reconnected, also without any additional fees.

But the whole question of waiving additional charges bothered Commissioner Justin Olson.

‘‘We may be actually creating an enticement to not pay one’s bill,’’ he said. ‘‘If one has other bills that will accrue interest and late fees, as most bills do, then there’s an enticement to delay paying this bill.’’

He said that could actually make matters worse in the long run for some customers who might have been able to pay at least part of their summer electric bills but choose, in essence, to take the interest-free loan. And that, said Olson, creates a risk that some people will get in so deep that they will end up struggling to bring their account into balance by the following Feb. 15, resulting in them losing power at that time.

Sandra Kennedy

Commissioner Sandra Kennedy

But Sandra Kennedy defended adding the no-fees language to the emergency order.

‘‘I think what we have seen recently is a utility that has learned to beat the system,’’ she said. ‘‘So, I’m offering this amendment so that this one utility is not allowed to charge late fees or interest on the dollars that are already delinquent.’’

Kennedy never made a specific reference to Arizona Public Service, the state’s largest electric company.

It was that utility’s action last summer to disconnect the power of 72-year-old Stephanie Pullman after she had paid just $125 of her $176 bill that led to Thursday’s emergency rules. Pullman was found dead in her Sun City West home, with the death certificate saying she had pre-existing conditions that were exacerbated by the temperature in her house.

Kennedy argued that eliminating extra fees actually gives customers a chance to catch up on what they owe.

But Kennedy, the lone Democrat on the commission, said there’s a larger issue at work in why customers – 110,000 last year in APS territory alone – are being cut off in the first place.

‘‘It’s a hardship because people can’t pay their bills,’’ she said.

‘‘It’s a hardship because the rates are too high,’’ Kennedy continued. ‘‘What do we do about that? We’ve been very silent on that.’’

Olson is skeptical about exempting past-due amounts for bills in the summer from interest and late fees. He pointed out there is no similar exemption for those who don’t pay their bills on time the rest of the year.

Kennedy, however, said the focus now should be on the immediate issue of utility customers whose health or lives could be in jeopardy if their power is shut off during the hottest months of the year.

‘‘If we sit idle, and we sit silent, then we are just going along to get along,’’ she said.

Electricity MeterThe emergency rules also contain a provision that says if customers have a deposit on hand, then utilities must first look to the deposit to make up anything owed. Then customers will get four months to bring the deposit back to where it was before.

The rules, adopted on an emergency basis and approved on a 4-0 vote, are good for up to 180 days, with the opportunity of regulators to renew them for another 180 days on top of that.

Elijah Abinah, the commission’s utility director, said he hopes to have a final proposal for the panel to enact before next June.

A number of issues are still left on the table, and they likely to come up as regulators debate a permanent plan.

One is the desire by Kennedy to have the no-disconnect period start on May 1, instead of June 1.

There also is some discussion about using weather forecasts and temperatures as a trigger rather than specific dates.

‘‘That’s going to be an interesting discussion,’’ said Commissioner Boyd Dunn.

At least part of that question relates to concerns expressed in a letter to the commission from attorneys for the Navopache Electric Cooperative, seeking an exemption.

‘‘Temperatures rarely, if ever, reach 100 degrees Fahrenheit within its service area,’’ the letter reads. ‘‘The justification for implementing the four-month moratorium on termination of residential services has no application to NEC.’’

A similar complaint came from Mohave Electric Cooperative.

‘‘Persons in the Bullhead area are used to and know how to handle temperatures that regularly are above 100 degrees,’’ the utility wrote to the commission. And it noted that

Justin Olson

Justin Olson

during periods of high temperature, the city opens a cooling shelter for people to go, ‘‘whether or not they have utility service.’’

And that company’s attorney argued that, if Mohave Electric doesn’t get paid during the summer, it cannot pay its own bills.

Lea Marquez Peterson, who was just appointed to the commission, was not present for Thursday’s discussion and vote. Instead, she provided a prerecorded video of her views for her colleagues, listing some of the other things she believes need to be addressed as the regulators decide on a permanent rule.

One of those, she said, is requiring that there be ‘‘personal contact’’ with certain customers before actually cutting off power, including the ill, the elderly and the handicapped.

Pullman’s experience with APS was never far from the discussion.

‘‘I could not imagine what the Pullman family have gone through, a tragedy that we need to address,’’ said Dunn.

‘‘This is a tragic event that no family should have to endure,’’ said Olson.

 

One comment

  1. Lea Marquez Peterson has exactly the right idea. Personal contact will help determine the needs of a usually under served part of the community. Communicating ways to beat the heat (get local church help, for instance).
    How much revenue is represented by the late payments and what percentage of revenue is that? I note that power companies tend to generalize.

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