New rules in works on when utilities can shut off power

As the summer heat continues to punish Arizona, state utility regulators are getting closer to setting new requirements for when electric and gas companies are allowed to shut off service to people who are behind on their bills.

The Arizona Corporation Commission took up the issue in 2019 when it was revealed that a utility customer the prior year had died in her home after power was cut off for nonpayment, and other similar cases subsequently came to light.

The woman was late on her bills for months and was $51.84 short on her delinquent account after making a partial payment two days before the power was cut, according to information provided to state regulators.

The Arizona Corporation Commission issued emergency rules in 2019 restricting utility disconnections and utilities continue to operate under the rules set then while permanent rules were hashed out.

Earlier this year, the commissioners took an initial vote on permanent rules. The revised rules would allow electric utilities to choose to either prohibit disconnections from June 1 to Oct. 15 each year, or to prohibit them when the National Weather Service forecasts temperatures below 32 degrees or exceeding 95 degrees.

Chairwoman Lea Márquez Peterson and the two Democrats on the commission, Sandra Kennedy and Anna Tovar approved the new rules while Republicans Justin Olson and Jim O’Connor dissented over concerns about additional costs on other customers.

Gas utilities could choose to either restrict shutoffs when temperatures are not forecast to exceed 32 degrees or when there is a winter weather advisory.

The commission this week heard public comment on the permanent rules and will decide later whether to amend them or enact them as written, which would put them in place by summer 2022.

The administrative law judge in the

“We believe there should be one policy statewide to reduce confusion on disconnections.”

Steve Jennings

Associate state director for AARP

case will review all of the written public comments and those offered at the meetings, as well as responses to those comments provided by the commission staff, and decide whether to propose any changes. If the changes are substantial they will require more deliberation before they are enacted.

What the proposed rules say

Under the new rules, before a utility can disconnect service, the company has to make the customer aware of money available from community groups to help with such bills, provide at least two written notices and try to reach the customer by telephone.

Utilities also could no cut service on a day when their customer-service centers are unavailable to customers.

And shutoffs would be prohibited when a customer has paid half the outstanding balance in the past 25 days or when the customer owes $300 or less.

A utility also must use any deposit provided by the customer to pay the outstanding debt before cutting service and give the customer a chance to re-pay the deposit.

Steve Jennings, associate state director for AARP, said Thursday that the group supports a $300 threshold proposed in the rules for how much a customer must owe before they are subject to shut off, but also agrees with Kennedy that another hearing on the issue is warranted.

Commission staff has said another hearing on the matter could run afoul of the timeline requirements set by the Secretary of State.

“It is a very important policy,” Jennings said. “It could be in effect for 25 or even 50 years. There is really no more important policy than what is under inspection here.”

He said that regulators should reconsider giving utilities a choice of using a calendar or weather alerts to determine when they can shut people off.

“We believe there should be one policy statewide to reduce confusion on disconnections,” Jennings said. “The proposal that there could be a disconnection moratorium based on the dates or the temperature could lead to tragic confusion. It is possible a gas company could choose the dates and an electric company could choose the temperature, leaving the residential consumer confused and possibly terminated. We continue to urge that there be one policy.”

The Residential Utility Consumer Office, which was formed by state lawmakers to argue in favor of customers at such hearings, also supports the regulators in setting a single policy.

In written comments to regulators, RUCO has also signaled the organization wants regulators to consider the possible costs to other customers when some are allowed to let bills go unpaid.

“RUCO does not believe that this is a money issue or that money should prevent the commission from adopting the modifications,” the agency wrote. “RUCO does believe and would like to point out that when looking at a policy, any policy, we need to look at all sides and one side is costs.”

The Arizona PIRG Education Fund also has concerns that annual moratoriums that last too long can put customers into deep debt that is difficult to recover from since they are required to pay up once a moratorium ends.

“I’m pretty confident that none of us here today want anyone to pass away in their home or outside from the heat,” PIRG director Diane Brown said Thursday. “The question is what the commission can and should do to prevent indoor heat deaths.”

She said PIRG prefers a calendar moratorium rather than a temperature threshold of 95 degrees.

“If a 95 temperature is used there are households that will spend more months in a moratorium than not and their bills will presumably escalate, which will trap them in a cycle of perpetual debt,” she said.

Dozens of deaths in recent heat wave

While the regulators mull the issues, heat deaths both indoors and outdoors continue to cause concern.

Maricopa County officials are investigating 53 suspected heat deaths during a heat wave from June 12-19 when temperatures in the Phoenix area hit 118 degrees. Many of those involve people outdoors

That brings total suspected heat deaths to 73 so far this year in the county, while just three so far are confirmed.

Following the recent heat wave, Márquez Peterson issued a letter to all regulated utilities asking them to notify the commission of any deaths or hospitalizations they are aware of this year caused by people losing power, conserving power to save money or because of faulty air-conditioners.

“As our regulated electric utilities know, the Arizona Corporation Commission has an interest in understanding the relationship between retail electric service and indoor heat-related risks,” Márquez Peterson wrote.