Low-Income Energy Assistance Expansion Invited

Advocates called for an increase in energy assistance programs and efforts to enroll financially struggling households in utility rate discount programs as natural gas prices continue to soar. Their calls for greater assistance came during a special hearing in Los Angeles on October 6 that included California Public Utilities Commission members and several legislators. "The penetration of the number of people signed up and the number of people qualified to get these discounts is frankly not satisfactory," said Senator Richard Alarc?n (D-San Fernando Valley). Of more than four million customers eligible for discounted natural gas bills, only three million are enrolled, said Sean Gallagher, CPUC Energy Division director. He said that the average household gas bill in PG&E territory is likely to be $154.23 this coming January, compared to $107.83 last January - - a 43 percent increase. The typical January bill in SoCal Gas territory is likely to hit $124 this January, compared to $78 last January - - a 59 percent increase. Senator Martha Escutia (D-Whittier), Senate Energy, Utilities and Communications Committee chair, said she was very concerned about ?market manipulation.? She also expressed concern that the state?s Low Income Oversight Board has not been getting sufficient support from the CPUC. Thus, effective public participation is missing. ?Frankly, we struggle to get the Low Income Oversight Board the staff support it needs,? Gallagher replied. Assemblymember Lloyd Levine (D-Van Nuys), Assembly Utilities and Commerce Committee chair, blasted the board for failing to meet regularly and for not focusing on ideas for how to implement existing programs. He also called for a "door-to-door" outreach program to enroll low-income households in energy assistance programs this winter. CPUC staff will address a range of potential strategies for dampening the economic impacts of natural gas prices, said Steven Larson, CPUC executive director. In the short term, they may include increased use of financial hedging by utilities and greater emphasis on enrolling people in existing low-income assistance programs. At its regular business meeting earlier in the day, the commission approved a plan by Pacific Gas & Electric to expand its use of hedges to control gas prices. However, at the afternoon hearing on gas prices, the focus was on how to increase enrollment in existing low-income energy assistance programs. Utilities pledged to conduct more outreach to increase enrollment in low-income rate discount programs and suggested that the state consider expanding eligibility by increasing the qualifying income thresholds. Meanwhile, PG&E will attempt to dampen gas price increases under an expanded hedging program approved by the CPUC. Under its traditional hedging program, PG&E attempts to keep its gas costs below a monthly market-based benchmark. If it does so successfully, some of the savings are passed on to shareholders. If it fails to do so, shareholders pay a penalty. Under the new expanded plan - - which will run for the next three winters - - all of the risk and savings of those financial hedges will be shifted onto the utility?s core ratepayers. The CPUC estimates that expanded hedging will add about $2 a month to the average monthly bill but will prevent much larger increases. Commissioner Geoffrey Brown voted against the change in allocation of PG&E hedging risk. "PG&E should not hold ratepayers hostage to risk," said Brown. He called for shareholders to continue to bear some risk. "This is insurance, and it always costs something," countered commission president Mike Peevey.

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Low-Income Energy Assistance Expansion Invited

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