Two Questions

I’ll begin by asking two questions:

  • If a customer is not in good standing, does that mean he or she is in bad standing?
  • Can you be considered a customer in bad standing if you’ve never missed a payment?

The answers to these seemingly innocuous questions may be obvious to you. They certainly don’t look complicated to me. But according to the New Hampshire government, the answers might not be what you expect.

Many who know me already know the saga I’ve been through with my local power company, Eversource. Many who don’t know me but live in NH probably know somebody who has been through something similar. For anybody interested in the specific details, you can read through the details here. For the rest of you, I’ll give a short recap:

The NH branch of the power company, Eversource, changed their policy over the past two years to start requiring cash deposits from customers who have had more than three disconnect notices within a year. It’s a little more complicated than that, but this is the most common scenario.

Deposits

The first thing that comes to mind is that requiring a deposit in itself is not necessarily a bad policy. If a customer has demonstrated a pattern of risk, it’s in the company’s best interest to protect itself. The real problem is more clear when you look at why, and to who this is happening.

Over the course of my public battle, I’ve heard from countless constituents from my state that they’ve been affected unfairly by this policy. These people were not delinquent scammers looking to get a free month and move, nor was it free loaders looking to offload their energy costs to tax payers while enjoying their own luxuries.

They were people who had a hard time predicting how cold the winter would be. They were people who relied on electricity for heat, whose monthly electric bills could vary from under $100 in the summer, and as much as $800 in the winter.

The year Eversource began this policy was a combination of exceptional cold and record high energy prices, creating a perfect storm of customers who couldn’t predict their energy bills and were blown away when they discovered them to be hundreds more than the bills from same period of time the year before.

Eversource’s policy was to charge a deposit equal to two high-use months (exclusive of the highest peak month). For some, that meant paying a deposit of an upwards of $1600. This was a deposit they wouldn’t get back for at least a year, if not longer depending on missing a single payment in the future.

I’m sure some of you are thinking that this still sounds somewhat reasonable, given the circumstances that these customers were clearly demonstrating a pattern of risk to Eversource. But that’s where this gets a little dicey. These customers were never disconnected for nonpayment, they just needed extra time to catch up because they didn’t expect such high bills.

It’s easy to pay your phone bill when it’s the same price every year. But imagine if your bill arrived one month with a 400% increase than what you expected. Many people budget for at least a month in advance with very little wiggle room for surprises or incidents. I would imagine myself needing a little extra time to come up with that sort of money in that situation.

These customers never experienced a lapse in their service, instead they had only paid late, incurred the late fees associated, and kept their accounts current enough to carry forward.

But NH law says Eversource can demand a deposit from these struggling people, and demand they did.

I bet you’re wondering what this has to do with the two questions I posed at the beginning of this essay. I’ll address that now.

The Answers

The NH law actually provides a little relief for struggling customers who can’t afford the deposit. And let’s face it, anybody struggling to pay their bills are going to struggle with a big deposit.

The public utilities commission provided a handful of alternatives to avoid the deposit, one of which was having a responsible third party write a guarantee on behalf of the customer in question.

In a future essay I’ll address the specifics of all the options, and why the public utilities commission has not properly enforced most of them, but the one I wanted to discuss here today was this.

Explicitly stated in the rules, a customer in good standing can act as one such “responsible party.” And that’s the rule that I personally decided to test.

The short story is that my test failed, and along with it the hopes of many in my state. The long story is fairly interesting.

I decided to get a written guarantee of a customer who was in good standing, but who had only had an account for less than 6 months. Eversource immediately challenged this, stating they wanted a customer who had 12 months of history to act as a customer in good standing. No such legal definition exists.

It was on the public utilities commission to interpret the rules they wrote (and yes, there’s no check or balance on these administrative rules), and they decided that 12 months seemed like a good rule. A customer in good standing has 12 months of perfect payments. No less.

If you’re interested in reading my very persuasive legal argument, check out Attachment 5 of the Hearing Notification with the PUC. You don’t need to read it to continue on, but I think it’s pretty convincing.

The PUC inadvertently set a precedent with this new made-up definition that can likely do a lot of future damage. Their new definition of “good standing” determines that customers who are current with paying their bills, but have only paid 11 times in a row, are therefore not in good standing.

In my legal argument, I point out that good standing is a binary position. That is, you can either be in good standing or not. We all recognize that being in bad standing means you have not followed the terms of payment with a business. But the new definition now states that you can follow all the rules, pay on time, and still not be considered in good standing if you haven’t done it for an arbitrarily long-enough amount of time.

Needless to say the term “good standing” shows up in more places than just this one regulation. And if/when these terms get tested via hearing with the utilities commission, there will be many customers who are in perfect standing with a utility who are not afforded the rights of actual customers due to the irresponsible precedent the commission set.

The good news is, not everybody in our government are bumbling idiots.

I’ve been working closely with a few other representatives to close this glaring gap, and bring some reasonability to the regulation currently screwing with legitimate customers. We’re going to force the public utilities commission to recognize what the rest of the country already does: A customer in good standing is one whose account is not in arrears. And finally, we’re going to give customers another option to avoid deposit: become a customer in good standing.

I’ll keep you all updated as we move forward with this legislation, and I’ll ask anybody who has had first hand experience with this to come forward and testify. If you want to know more, get in touch with me right away and I’ll fill you in.