Dec. 9, 2002 — Attorneys for Consumer Groups joined Public Utility Commission of Texas (PUC) staff, the Office of Public Utility Counsel, and numerous cities in signing an agreement whereby Canada-based Centrica Corporation will acquire residential customer accounts of American Electric Power (AEP) in Texas.
AEP owns Mutual Energy CPL and Mutual Energy WTU. The Settlement Agreement was approved today in a public meeting of the PUC commissioners. Over half a million residential customers will be transferred to receive electric service from Centrica.
Texas Legal Services Center (TLSC), Texas Ratepayers’ Organization to Save Energy (Texas ROSE), Consumers Union, and Public Citizen intervened in the Centrica-AEP merger case before the PUC. The four consumer groups sponsored a nationally known expert witness, Barbara Alexander, to review the Centrica application. Alexander(s testimony made recommendations to improve PUC oversight of customer service quality and to restore low-income customer programs discontinued by AEP over the past year.
TLSC with other consumer groups limited their support of the deal to the sections of the agreement that affects low-income customers and social service agencies. The groups however, observe that the agreement also includes new procedures for handling complaints about Centrica(s Energy America door-to-door commissioned sales force. The consumer groups joined the agreement in support of a renewed emphasis on the needs of low-income consumers in the Valley and West Texas. In the agreement:
* Centrica agrees to restore funding for the Neighbor to Neighbor program formerly funded by AEP and customer donations. The program assists households in an energy crisis due to medical problems, unemployment or other emergencies. AEP stopped contributing last year and effectively ended the program. Today(s agreement will restore funding of $350,000 per year under Centrica(s management through June 30, 2006. The company also pledged to restore outreach to encourage customer donations to the bill check-off program.
* Centrica and AEP will also restore a program to install weatherization and energy efficiency improvements in buildings used by non-profit social service agencies including homeless shelters, senior centers, and Head Start programs. CPL and WTU are to dedicate $100,000 each annually through June of 2006.
* Centrica will improve outreach for the Lite-Up Texas program that provides a 17% rate discount for Texans who are below 125% of federal poverty guidelines or who are enrolled in programs operated by the Department of Human Services.
* Centrica pledged to work with low-income agencies and consumer groups to improve the handling of emergency calls from low-income assistance agencies. In recent months, agencies have complained to the PUC that payments were not properly credited and that they had difficulty reaching supervisory staff to work out agreements to get customers current in their bills.
* Finally, the agreement includes a requirement that Centrica will closely monitor how AEP’s customer service staff will operate during a two-year transition period. In recent months increasing complaints have been filed at the PUC about AEP’s service quality.
Texas Legal Services Center Executive Director Randall Chapman stated, “The Agreement extends customer protections for low-income families that were in place prior to electric competition. Community Action Agencies will once again have Neighbor to Neighbor funding available to help families in a crisis. AEP unilaterally stopped funding for low-income programs when electric competition started. We are pleased that Centrica sees that it is in their own self-interest to assure that emergency funds are available to help families in crises situations. In the future, we will request the PUC to set minimum standards to require that all companies offer customers access to bill payment assistance programs.”
Texas Ratepayers’ Organization to Save Energy Executive Director Carol Biedrzycki said, “I’ve heard stories that would break your heart about people in need who had to be turned away because there were no more Neighbor to Neighbor funds. I’m also pleased that the energy efficiency program for nonprofit agencies will continue. Buildings used by nonprofit agencies are often old and use a lot of energy. For the agencies, lower electricity bills mean more money for client services.”
