SRP customers to address board about proposed rate hike - East Valley Tribune: Business

SRP customers to address board about proposed rate hike

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Posted: Sunday, September 9, 2012 7:00 am

Low-income SRP customers upset over a proposed 4.8 percent rate hike plan to share their stories Monday during the public meeting of the utility company’s board.

SRP, a Valley-based public utility company, announced this summer it would seek the rate increase, the first since spring 2010.

Arizona Community Action Association sent out a news release stating that several nonprofit organizations that advocate for low-income families are concerned the rate increase will put the customers “at even greater risk of homelessness and will penalize customers using the lowest amounts of electricity.”

On Monday, SRP will officially present its rate proposal to the board of directors. The board will ask questions as well as hear public comment. A vote on the matter is scheduled for Sept. 27.

“We will be at the public hearing along with men and women who are working two, three and even four jobs, but who continue to struggle to pay their bills despite their best efforts,” Arizona Community Action Association Executive Director Cynthia Zwick stated in the release. “This is not an easy time for too many families in Arizona and we’re asking SRP not to make it more difficult for those who can least afford it.”

In addition to the rate hike, SRP is seeking to increase its monthly service fee from $15 to $17.

“While it may not seem like a lot of money on the surface, when you look at the big picture, thousands of families in Arizona are already struggling simply to make ends meet,” Zwick stated. “Many of these families have never needed assistance in the past, but the economy has wreaked havoc on their lives. For a lot of men and women, it comes down to deciding whether to pay the utility bill or feed their families and even a slight increase in their monthly expenses can mean the difference between having a place to live or being homeless.”

SRP spokesman Scott Harelson said there are several ways SRP works to help low-income customers, including its Economy Price Plan. Eligible households — who are at or below 150 percent of the federal poverty level — receive a $17 monthly credit or discount, which offsets the current $15 service fee charged by the utility company, he said. There are 43,000 people on the plan, he said.

In its news release, the Arizona Community Action Association asks SRP to raise the $17 monthly credit or waive the rate increase for low-income customers.

“We take that very seriously and we do go to a great deal of effort to work with our customers in financial difficulty. We understand and take seriously the fact that this proposed price increase is made during a time when the economy is not in great shape,” Harelson said. “But the revenue we’re seeking we feel is necessary at this point to keep our system working reliably.”

SRP also employs 12 full-time credit counselors who work with low-income customers struggling to pay their bills.

“They answer 65,000 calls per year. This is pretty unique to all utility companies. They maintain active relationships with community partners and agencies and work very closely with those agencies and can refer our customers to the appropriate agency to seek assistance,” Harelson said. “The agencies can call us directly on behalf of our customers who find themselves in financial difficulty and we’ll work with them.”

The credit counselors are authorized to override any credit policies of SRP and can help set up payment plans, even “unique” ones that correspond with a customer’s payday.

Finally, Harelson said, customers can take advantage of the company’s M-Power plan, a prepaid electric plan that let’s them put money into a device attached to the house at any time. With the M-Power plan, customers who are disconnected do not have to pay a reconnection fee. They just add more money to the plan.

More than 130,000 customers use the M-Power plan, he said.

Harelson said one of the major reasons SRP is seeking the rate hike is to pay for necessary repairs and upgrades, as well as to keep up with renewable energy costs.

SRP has put off maintenance on some equipment at its power plants the last few years to avoid a rate hike, Harelson said, but the company can’t afford to do that any longer.

“The fact is those maintenance activities now can no longer be delayed,” he said.

During the last rate increase, the board of directors increased the low-income credit form $15 to the current $17. It also approved a $1 million donation to the Home Energy Assistance Fund, which is managed by the Arizona Community Action Association to assist SRP customers, according to a release from SRP in March 2010.

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