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PSC calls on utilities to work with customers facing large heating bills

Urges flexibility after brutal winter cold leads to high heating costs

FRANKFORT, Ky. (Feb. 24, 2014) — The Kentucky Public Service Commission (PSC) is calling on the state’s electric and natural gas utilities to work with customers who are having difficulty paying extremely large heating bills in the wake of extremely cold weather this winter.

thermostatIn a letter sent to the chief executives of the utilities, the PSC asks that utilities “be as flexible as possible … in avoiding disconnections and in allowing customers to make arrangements to extend their payments.”

“We know that utilities in Kentucky are sensitive to the fact that these very large bills have come as a shock to many customers,” said PSC Chairman David Armstrong. “The PSC is confident that utilities will do all they can to assist customers who may have trouble paying their bills in full by the due date.”

Armstrong noted that having to disconnect customers for non-payment benefits neither the customer nor the utility. PSC regulations allow utilities to set up plans that allow the bills to be paid over a specified time period, he said.

Utilities also offer special help to lower-income customers, in addition to the assistance offered by the state via the Low Income Home Energy Assistance Program, or LIHEAP. A number of utilities have announced increased corporate contributions to their assistance programs.

The PSC letter also asks utilities to further encourage customers to enroll in budget-billing programs, which all electric and natural gas utilities are required to offer. The programs allow customers to pay the same amount each month, based on their average monthly usage during the year. This reduces large seasonal fluctuations and has the effect of spreading winter heating costs over months when energy usage typically is lower.

            PSC Commissioners also noted their long-standing support of energy efficiency programs that invest in measures that reduce energy consumption. Those programs are the best way to curtail high heating costs on a long-term basis, the PSC said. The letter encourages utilities to look for ways to expand the energy efficiency programs they offer to their customers.

Temperatures are the largest factor determining energy consumption during the winter months and in turn drive month-to-month fluctuations in energy bills.

National Weather Service data indicate that this winter has averaged about 10 percent colder than normal across Kentucky, using a measure that calculates heating demand. But the cold did not really set in until the first of this year.

December was slightly warmer than or close to normal across the state. January temperatures, however, were much lower than normal everywhere, with the eastern Kentucky bearing the brunt of the cold and western Kentucky the least affected. The city of Jackson in Breathitt County was about 22 percent colder than usual, according to National Weather Service figures.

The unusually cold weather has persisted through February, although the pattern has shifted. Paducah was 33 percent colder than normal through Wednesday, while Louisville was 24 percent colder than usual and Jackson was relatively warm, at only 13.5 percent below normal.

Another wave of cold temperatures is forecast to cover the state next week.

“The effect of this weather on utility customers is going to be with us for a while,” Armstrong said. “We hope that both customers and utilities will work together in good faith to resolve any difficulties.”

Armstrong said the PSC’s Division of Consumer Services can provide information about billing issues, including budget billing, payment plans and similar matters. The division can be reached via the PSC’s toll-free consumer hotline, 800-772-4636.

The PSC is an independent agency attached for administrative purposes to the Energy and Environment Cabinet. It regulates more than 1,500 gas, water, sewer, electric and telecommunication utilities operating in Kentucky and has approximately 90 employees.