$250 million on the way for struggling electric, gas customers

With arrears ballooning and service shut-offs looming, help is on the way for utility customers struggling to pay overdue electric and gas bills.

The state's new budget includes $250 million to help residential customers whose past-due electric and gas bills have swelled to a total of more than $180 million on Long Island.

Statewide, experts expect utility arrears for gas and electric alone to balloon to a total of $2 billion within the next month.

Combined with other programs, the new funding could help wipe out much of the arrears tied to the COVID-19 pandemic, said Richard Berkley, executive director of the Public Utility Law Project of New York, a utility watchdog group.

Berkley called the state’s $250 million commitment “historic.”

However, it’s still uncertain precisely how the aid will get to customers.

“The challenge now is to create a program to get that money out to help people as quickly as possible,” Berkley told Newsday.

Berkley said he expects most of the money to be to funneled through existing energy-assistance programs.

Ashley Chauvin, spokeswoman for PSEG Long Island, said the company “is aware of the arrears forgiveness funding included in the New York State budget and is actively working with LIPA on developing a plan to see these funds made available to customers.”

News of the new state aid in Gov. Kathy Hochul’s budget comes just as utilities have received the green light to threaten shut-offs for customers who don’t pay their bills.

With relief aid on the way, customer advocates say they hope service shut-offs can be prevented.

PSEG has “not yet set a date for resumption of service shut-offs due to nonpayment,” Chauvin said. “Once a day has been set, we will conduct customer outreach through a variety of channels” to let customers know what’s coming.

The vast majority of ratepayers in arrears are customers of the state’s largest utility, Con Edison.

Berkley said he expects disbursements of the new aid to go initially through existing low-income programs, and then spread to “where you have the most arrears and most need."

Programs "will be designed so it doesn’t just go to Con Ed. It will be spread to all utilities,” Berkley said.

There’s no question of need on Long Island.

At a LIPA trustee meeting on March 30, Carolyn MacKool, LIPA’s director of customer experience oversight, said total residential and commercial arrears doubled for LIPA over two years, to $234.9 million as of February, compared with $112.4 million in 2020.

The amount of past-due bills more than doubled to $181.5 million, from $94.5 million, while commercial arrears jumped from $18 million to $53.4 million over the same period.

PSEG last fall restarted the process of shut-offs for commercial customers, who are not expected to be eligible for pending arrears forgiveness programs, although small businesses may be.

About half the commercial accounts in arrears are on payment plans, MacKool said.

“A lot of that is specifically due to that tactic of walking up to the customers, and having a conversation,” about ways to repay overdue bills, MacKool said.

“Our message is, reach out to us, there’s assistance there, we have great plans, connect,” she said. 

Monthly payments for arrears can be as low as $10, MacKool said.

Service disconnects are “a last resort,” she said.

As of March 30, just over 22,000 LIPA residential customers with total arrears of $60 million were eligible for shut-offs, officials said.

About 37,500 residential customers were on payment plans to settle $61.7 million in arrears.

There also are about 26,000 inactive residential accounts that owe some $8.3 million.

Some 2,400 commercial customers with arrears totaling $10.3 million are eligible for shut-off. There are 2,453 inactive commercial accounts.

Programs to help residential customers include the Home Energy Assistance Program that provides a one-time income-based payment to help with energy bills, emergency HEAP and Project Warmth, which can provide up to $200 for electric costs and $700 for heat-related help.

Since October, 6,284 customers have received $12.9 million in financial assistance from those programs, MacKool said.

Berkley said such assistance programs, combined with the state’s new arrears forgiveness money, could help wipe out much of the past arrears.

“Putting all these together, we can end up on the other end of a complete recovery for everybody,” Berkley said.

PSEG customers who need help paying bills can call 800-490-0025, or visit its financial assistance web page here. 

The Public Utility Law Project’s hotline to help customers is: 877-669-2572

National Grid’s assistance page is available here.

By Mark Harrington

mark.harrington@newsday.comMHarringtonNews

Mark Harrington, a Newsday reporter since 1999, covers energy, wineries, Indian affairs and fisheries.