Press Release

PUC Rejects PGW Upfront Payment Policy for Customers as Unreasonable, Unauthorized Under Chapter 14

Published on 11/10/2005

Filed under: Gas

HARRISBURG – Calling the law “clear and unambiguous”, the Pennsylvania Public Utility Commission (PUC) today passed a motion ordering Philadelphia Gas Works (PGW) to stop charging consumers higher fees than permitted by Chapter 14 to reconnect service and inform residents without service of the proper amounts.

“In this filing, PGW is attempting to increase to the poor and the poorest of the poor the upfront payments for those seeking reconnection,” said Commission Chairman Wendell Holland. “These are the Katrina-type victims. In my view, this clearly defies the legislative intent, which was to target those who could afford to pay but chose not to. PGW has options, certainly more options than its customers. Unduly increasing the energy burden on the truly needy is patently unfair and unreasonable.”

Under the motion, PGW is required to:

• Stop requiring upfront payments greater than those specified under Chapter 14;
• Contact any customer that has already been surveyed as part of the company’s winter survey and inform those customers of the correct amounts needed to restore service and;
• Mail accurate information regarding amounts needed to restore service to all customers terminated since April 1, 2005.

The petition filed by PGW requested that the commission to modify its order issued Sept. 9, 2005. PGW argued that Chapter 14 does not mandate the maximum amount a utility can charge as a condition to restore service. PGW also cited its financial condition as a reason for requiring higher upfront payments from customers outside of consumer assistance programs (CAP), known as the Customer Responsibility Program (CRP) at PGW. The PUC unanimously rejected those claims. A separate motion passed 3-2 stating the implementation orders at issue constitute policy statements setting forth how the commission intends to interpret Chapter 14 in future adjudications and rule makings.

Provisions under Chapter 14 do not apply if consumers have broken two or more payment arrangements. Those who have defaulted on two or more payment arrangement must pay the entire outstanding balance. “Catch up” payments may be required from customers who have broken no more than one previous payment arrangement.

According to the PUC order, a comparison chart  of the Chapter 14 requirements for reconnection and PGW’s policy.

Chapter 14 was passed by the General Assembly as Senate Bill 677 and signed into law as Act 201 of 2004.  Chapter 14 seeks to eliminate the opportunities for customers capable of paying to avoid paying their utility bills, and to provide utilities with the means to reduce their uncollectible accounts.  The new law changed rules for regulated electric, water and major natural gas utilities that apply to cash deposits; reconnection of service; termination of service; payment arrangements; and the filing of termination complaints by residential customers.

As part of the implementation of Chapter 14, the PUC also has directed electric, natural gas and water utilities to coordinate with the PUC, consumer advocates and community-based organizations to educate Pennsylvanians about changes in the law dealing with utility shut-offs. 

The message is:   “Prepare Now” for higher energy costs this winter.  Learn about changes in the law related to utility shut-offs and know your rights.  Save money by learning how to conserve energy.  Budget billing and special programs can help you manage your bill.  Heat your home safely.  “Prepare Now,” before cold weather arrives. Visit www.puc.state.pa.us, and click on “Prepare Now for Winter” or call the PUC at 1-888-PUC-FACT.

The Pennsylvania Public Utility Commission ensures safe, reliable and reasonably priced electric, natural gas, water, telephone and transportation service for Pennsylvania consumers, by regulating public utilities and by serving as responsible stewards of competition. For more information about the PUC and additional press releases, visit our website at www.puc.state.pa.us.

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Docket No. M-00041802F0002

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