Journal FILES / Connie Grosch

WARWICK –– The three members of the Public Utilities Commission yesterday harshly criticized their own rules that govern utility shutoffs, and the chairman offered a “confession” that his decision several years ago to urge a utility company to be more vigilant about collecting overdue bills was a “mistake.”

The remarks were made in what is usually a mundane “open meeting” in which the commissioners meet to discuss and vote on pending regulatory matters. The public can attend in order to hear the deliberations, but rules don’t allow others to participate.

The issue that prompted the unusual comments was a request filed earlier by the George Wiley Center requesting that the PUC loosen its rules regarding utility shutoffs for customers who have lost service for not paying their bills.

The center, which lobbies on behalf of low-income families, asked the PUC to allow customers to get their service restored by paying only 10 percent of the overdue balance. Current rules require at least a 25- to 50-percent payment to have service restored, depending on the customer’s payment history.

The center’s request comes at a time of growing concerns about how Rhode Islanders will afford the upcoming heating season, with utility rates at record levels. On July 1, National Grid, the state’s dominant utility company, increased electricity rates by 21.7 percent and natural gas rates by 8 percent. In the first six months of this year, the company has shut off service to 12,165 gas and electricity customers for non-payment, according to figures provided by the Division of Public Utilities and Carriers. That is 6 percent higher than the number of customers in the first six months of last year. There were 4,235 accounts that remained without service at the end of June, according to a filing to the PUC by National Grid.

Yesterday, the PUC considered the request to lower the down-payment requirement, but decided –– for now –– to reject it until the commission gets more information about its impact. The panel voted 3 to 0 to open an investigation into its utility-termination rules. And it voted 2 to 1 to ask National Grid about customers currently without service and to provide the data before the panel’s next meeting, Aug. 7. PUC Chairman Elia Germani and Commissioner Mary Bray voted for the motion; Commissioner Robert Holbrook voted against it.

During their discussions, the strongest criticism of the PUC termination rules came from Holbrook. He recited some statistics provided by National Grid that showed that about 90 percent of the customers who enter payment plans with the utility company as part of an agreement to have service restored end up breaking those agreements.

He also questioned how the rules have allowed one particular residential customer –– he didn’t say who –– to amass an overdue balance of $33,000.

“The system we have right now is a farce, it’s a joke,” Holbrook said.

“I think payment plans don’t work because they’re not affordable,” said Bray. “People are desperate. They’ll do anything to get utility service turned on.”

She said the current rules on payments were put in place when energy costs were much lower. Now, some people have overdue balances of $8,000, she said.

“There’s no way people are ever going to get out of that,” she said. The commission should look at lowering the down payment and allowing customers more time to pay the rest, she said.

Bray said the commission would be doing a disservice if it didn’t reexamine all the termination rules. And, she said, the work must be done quickly. “We can’t let this go on for months and months.”

Germani said he hoped that opening an investigation to review the termination rules would spur the General Assembly to take another look at passing heating-assistance legislation. (The General Assembly this past session revoked a law that established a heating-assistance program, citing a lack of funds because of the state budget shortfall.)

But the real solution to heating affordability, he said, lies not with the General Assembly, but with the U.S. Congress. He said the federal government needs to increase the funding it provides to states through its Low Income Home Energy Assistance Program. Germani said that Republicans in Congress have stalled Democratic legislation that would increase LIHEAP funding.

About the proposal to lower the required down payment to have utility service restored, Germani said it would be premature for the PUC to do so. The commission needs more information about how lowering that amount would affect other ratepayers, he said.

During his remarks, Germani conceded that he had made a mistake in siding with his fellow commissioners on an issue relating to collecting overdue money owed by customers.

“I have a confession to make,” he began. Several years ago, he said, he was persuaded to criticize a utility company for not being vigilant enough in pursuing customers who had overdue back balances.

In November 2003, the PUC said that New England Gas [the name of the gas company before it was acquired by National Grid] “should become more proactive in its collections activity and in terminating service to customers who have large gas balances.” In that order, which granted a natural-gas rate increase, the commission noted that utility costs of those who do not pay are shifted to all other ratepayers.

Yesterday, Germani said that in retrospect, those remarks were “troublesome.” He said that the Rhode Island PUC was urging more vigilance in bill collections at a time when other states were saying just the opposite.

“That was a mistake,” Germani said.

tbarmann@projo.com