84,000 risk BGE shut-off

Cold-weather protections for delinquent customers end in April

Utility Woes

March 06, 2009|By Laura Smitherman | Laura Smitherman,laura.smitherman@baltsun.com

Nearly 84,000 households with delinquent utility bills could see their power shut off by Baltimore Gas and Electric Co. starting next month, when restrictions meant to protect customers during cold winter months end, the state's top energy regulator warned.

Douglas Nazarian, chairman of the state's Public Service Commission, called the situation facing consumers a "potential tsunami," as many residents have seen their utility bills rise, and in some cases double. In all of last year, about 36,000 BGE customers had their service terminated.

"April will be a disaster if we don't start looking into this," Nazarian said. "The problem is going to grow."

The staggering number of residents struggling to pay utility bills has stoked calls for a moratorium on utility shut-offs. The PSC is weighing the idea, though officials caution that while such a step might help people in the short term, it would allow past-due debts owed to the utilities to mount and could diminish incentive for customers to pay.

The impending service terminations involve residents across the state and income levels - nearly 43,000 Pepco customers in the Washington region also could have their utility service terminated starting in April, and the vast majority of BGE and Pepco customers who could be eligible for cutoffs are not considered low-income.

Executives with Constellation Energy Group, BGE's parent company, said they are encouraging customers to take advantage of payment plans and are working to educate customers on using energy wisely.

Jeannette Mills, a senior vice president, said that 84,000 service terminations would be a "worst-case scenario" and that the company projects 45,000 net terminations for the year, not including the number of people who lost service but were reconnected.

"We are continually calling customers and trying to work with customers in terms of payment plans," Mills said. "There are some customers unfortunately who end up being disconnected. The flip side of that is a small number of customers who would not pay if they knew termination wasn't coming."

One BGE customer, Elizabeth Grant, said she couldn't afford the high energy bills at her drafty three-story home in West Baltimore, so she moved her three children to a smaller home in Northeast Baltimore. But her past-due amounts followed her. Although Grant is on a payment plan that deducts $200 for utility costs from her twice-a-month paycheck, she said she received a turnoff notice in November for owing more than $700.

"Financially it has really drained me," Grant said. "Sometimes, even though I have family members give me food, I don't want to go to them because I know they're still struggling with their gas and electric bill as well."

She said that her family has taken pains to avoid more debt, by using energy-efficient lightbulbs, setting the television on timers and even avoiding opening the refrigerator after dinner has been made and eaten.

Also in Baltimore, Novelette Callender pleaded for help yesterday at a Maryland Fuel Fund office. She said her daughter has seen her bill jump several hundred dollars in the past month and has received a shut-off notice. Her daughter, she said, keeps the furnace at 78 degrees so that her 6-month-old twins are comfortable in their thin-walled home in Northwest Baltimore.

She said the family is trying to convince a pediatrician to write to BGE to explain that her daughter has infants at home and the company shouldn't turn off the heat.

Utilities can halt service when a customer's balance exceeds $200 for electricity or natural gas, or $300 for both; and when the total due is greater than the deposit. Rules are more lenient for low-income customers who apply for aid, the elderly and those on life support.

State regulations impose further restrictions on utilities during cold weather months for safety reasons. From Nov. 1 to April 1, service terminations are limited when the weather forecast does not exceed 32 degrees for 24 hours. Utilities also must file affidavits confirming that they made personal contact with customers before shutting them off and explaining the reason for doing so.

The state is processing record numbers of applications for energy assistance and is on pace to help about 140,000 households this year, according to regulators. Baltimore Chief Solicitor Matthew W. Nayden told regulators at a Wednesday hearing that the state energy assistance program office in Baltimore had hired temporary workers and volunteers to process aid applications, but computer problems led to a backlog.

The PSC has opened an inquiry into rising utility bills, and Nazarian and energy company executives were summoned to Annapolis yesterday to answer questions from concerned state lawmakers deluged with constituent protests.

Utilities have provided a number of reasons for the mounting bills, including colder than normal weather, longer billing cycles and higher prices for electricity and natural gas. They also have noted that more households are using flat-screen televisions and video game systems that can drain energy.

Nazarian said yesterday that the commission has not completed its investigation but that it would move quickly to address the issue. "There is no easy, uniform, smoking-gun kind of answer to this," he said, "so we are going to continue to dig."

Several lawmakers expressed exasperation. Sen. Katherine A. Klausmeier, a Baltimore County Democrat, told utility executives to be more customer-friendly, relaying complaints from constituents.

Sen. Nathaniel J. McFadden, a Baltimore Democrat, said: "I'm really frustrated and my constituents are calling me asking me, 'What gives?'"

Baltimore Sun reporters Liz F. Kay and Gus G. Sentementes contributed to this article.

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