An emergency request to help low-income Mainers struggling with high electric bills was rejected Tuesday by the Public Utilities Commission, which said it didn’t have the legal authority to grant the request and expressed concerns that other customers would have to pick up the tab.
At issue was a request by William Harwood, the state’s public advocate, for a one-time, $75 bill credit for each of the roughly 25,000 Central Maine Power and Versant Power customers enrolled in the state’s Low-Income Assistance Program. The program helps pay electricity costs for homeowners and renters who meet a variety of criteria, such as income capped at $30,860 for a one-person household.
“Maine customers need immediate relief,” Harwood said in his petition. “Providing a $75 bill credit will help low-income customers to purchase needed electricity and thereby avoid late fees, reduce the utilities’ bad debt write off, and reduce the number of customers facing disconnection.”
But the PUC unanimously rejected the request.
During deliberations, Philip Bartlett, the PUC’s chair, reviewed several statutes regarding the agency’s authority. He said none would allow the request made by Harwood. He also expressed concern that the proposed credit could shift costs to other struggling Mainers who don’t qualify for low-income programs.
“This ad hoc approach to rate relief would result in cost shifting and is not practical or sustainable,” Bartlett said.
Harwood said the denial caught him off guard.
“I’m disappointed, but actually, I’m also a little stunned,” he said in a statement. “The PUC is interpreting the law to indicate it doesn’t have the authority to do this, but it’s no different from the emergency payments that were approved last year. The need is immediate, the legal issue is the same as last year, yet this time the PUC kicked the issue to the curb.”
A national group representing 200,000 older Mainers that has been opposing recent utility rate hikes also expressed frustration. It said a pending increase in electric supply rates requires emergency action.
“AARP is disappointed by the commission’s action today to deny the OPA’s emergency petition without even a nod to gathering public input,” said Noël Bonam, AARP’s Maine state director.
Rate hikes for CMP and Versant customers who get their power supply via the state’s standard offer program are set to take effect in January. Power in 2023 will be supplied largely by subsidiaries of New Brunswick Power and NextEra Energy, which won competitive bids at the PUC. CMP and Versant deliver power, but don’t generate it.
Beginning on Jan. 1, supply rates for home and small-business customers in CMP’s service area will rise from 11.8 cents per kilowatt-hour to 17.6 cents, a 49% hike. Electricity supply makes up roughly 60% of a total monthly bill. When delivery charges are added, the total bill for a typical customer using 550 kWh will go up $31.99 a month, from $122.59 to $154.58.
The PUC also last fall approved a new supply rate for Versant customers. The new rate will increase the bill for a typical household using 550 kWh of electricity a month by nearly $24, from $114.78 to $138.55.
In his petition, Harwood estimated that the program would cost about $1.9 million and that the utilities could recover the cost in higher distribution rates “at some future time when supply prices are not so exorbitant.” Harwood noted that at current rates, the $1.9 million would represent less than 0.5% of CMP and Versant’s combined revenue of approximately $425 million.
But during deliberations, Bartlett said that Harwood may be underestimating the cost by misjudging the number of eligible customers. The result, he said, would be similar to running up credit card debt, with no plan to pay it off.
CMP serves 636,000 customers in the southern and central parts of the state. Versant serves about 159,000 customers in northern and eastern Maine.
LOOMING CRISIS
Tuesday’s action is the latest attempt by state government to ease the energy cost burden for Mainers, who have been facing record prices over the past year to warm and light their homes.
Last March, nearly 90,000 low-income families got a $90 credit on their CMP and Versant electric bills, following a similar proceeding at the PUC. Money came from the Low Income Heating and Energy Assistance Program to cover the $8 million cost of the credit, administered by the Maine State Housing Authority. During deliberation Tuesday, Bartlett noted that this money came from federal sources, not Maine ratepayers.
In turning down the request, Bartlett noted the Maine Legislature is poised to consider a funding request for energy relief, and that is a more appropriate forum.
Bartlett was referring to a pending legislative hearing Wednesday regarding a proposed $450 relief check supported by Gov. Janet Mills. The emergency bill, aimed at both the high costs of energy and housing exacerbated by inflation, failed to win approval this month from Senate Republicans. The rejection led to partisan finger-pointing, new negotiations and the upcoming hearing.
That’s where AARP will now turn its attention.
“AARP welcomes further action by the Legislature,” Bonam said, “with adequate public input, and urges a coordinated and targeted approach for both home heating customers and those who must pay for essential electricity service.”
Beyond electric rates, home heating oil hit a record statewide high of $5.71 a gallon in mid-November, according to price surveys done by the Governor’s Energy Office. Prices have retreated this month, down to an average of $4.50 a gallon in last week’s survey, and many dealers are selling below $3.80. But kerosene, used in many manufactured homes, has remained stubbornly high, averaging $6.72 a gallon. Oil and kerosene are burned to warm six in 10 Maine homes.
To help with heating costs, the Maine Department of Health and Human Services is sending out a new round of heating cost relief to help older, low-income Mainers. It will provide one-time payments of $500 to 13,000 qualified households that include people 65 or older with income less than 133 percent of the federal poverty level. The one-time $6.6 million cost comes from existing state funding targeting older Mainers at risk of illness due to cold, the department said, and complements other heating relief distributed this year.
As state government considers ways to ease this winter’s energy burden, market forces are providing relief for gasoline prices. GasBuddy, the online fuel savings platform, said Tuesday that gas prices had fallen to their lowest levels in 18 months. A handful of stations in southern Maine are now selling fuel below $3 a gallon, according to GasBuddy’s website.
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