Quick Take: The Low Income Energy Issues Forum recently commissioned a meta-analysis of more than 70 studies, presentations and articles about programs for low-income customers. The result was a white paper issued by the Distributed Energy Financial Group. I’ve listed some of the highlights below, but you will want to download “Low Income Consumer Decision Making” for further study.
DEFG’s Low Income Energy Issues Forum is focused on innovative and integrated policies and approaches that can help to close the widening gap between what vulnerable energy consumers can pay and their current utility bills. Nat Treadway, DEFG
Turns out there ARE ways to make progress on this nagging challenge. And that smart grid technologies can help make things better. – Jesse Berst
Low-income customers are those making 200% of the poverty level or below (although some set the bar at 150%). They include retirees, unskilled and semi-skilled workers in low-wage jobs, those with disabilities and those who are highly educated but who have chosen a low-paying profession.
The very poor pay over half their income for energy according to one study. Utilities have been working for decades to formulate programs and protections. Yet many eligible families do not take advantage of assistance that could reduce their bills.
Those operating from a place of scarcity often feel overwhelmed with a spiraling sense of desperation. Ironically. If those families took better advantage of low-income utility programs, they would free up more cash for other needs and begin an upward spiral instead.
“The research supports that when low-income families have reasonable options for their energy use, assistance in understanding the tradeoffs, and the ability to manage their choices, they will choose to exercise control for the simple reason it will free up cash they can apply to other expenses,” the interest for vortex. Regulators and municipal oversight boards can help low-income consumers become active energy partners to the fullest extent possible by supporting effective policies, technology investments, and protections.”
And just what are the most effective policies? The white paper lists seven:
- Basic protections and policies that encourage people to be engaged and empowered;
- On-going education from trusted advisors from the utility or through other social service agencies, consumer advocacy offices, and community-based organizations (CBOs);
- Integrated program information to solve the family’s situation (rather than loosely coordinated utility silos of energy efficiency, weatherization, demand response, dynamic rates, etc.);
- Optional program and pricing bundles that reflect the family’s home usage patterns, habitat realities, and priorities, as well as alternative payment plans that align with cash flow;
- Subsidies, discounts, and payment plans optimized to allow families to remain current;
- Elimination of numerous extra fees that are punitive for people barely scraping by;
- Appropriate use of technology to facilitate communication and convenience.
The white paper admits that this combination of approaches is not currently the norm and that change in this sector is slow and gradual. However, the benefits to both customers and utilities are so positive and strong, that utilities are encouraged to include these principles in their thinking and planning.