NW Energy data shows decline use of low-income programs

Keila Szpaller

(Daily Montanan) NorthWestern Energy witnesses have said the utility tries to help customers afford their power bills — but one of its programs, to improve heating efficiency, has a roughly eight-year backlog, according to a question posed Tuesday to a utility vice president.

Lawyer Diego Rivas asked NorthWestern Energy’s vice president of customer care if she was aware of that backlog of customers trying to take advantage of the weatherization program.

Rivas said the backlog represents just one district, Human Resource Council XI in Missoula. The program is supposed to help low-income customers manage their energy bills.

Bobbi Schroeppel, vice president of customer care, communications and human resources for NorthWestern, said she did not know the actual number of years. However, she said she was generally aware of the situation.

On the sixth day of a hearing on a NorthWestern rate case and proposed settlement before the Montana Public Service Commission, Rivas also asked Schroeppel if she knew the reason some customers couldn’t get help.

“Are you aware that weatherization contractors like the Human Resource Councils are having difficulty servicing low-income customers with weatherization dollars because of the way NorthWestern administers those low-income weatherization dollars?” Rivas asked.

Human Resource Councils help people who earn lower incomes and those in poverty tap into programs that offer financial support.

Schroeppel said the question would be better posed to another witness. However, she agreed NorthWestern hasn’t proposed to make any changes in the way it deals with those dollars.

“Not at this point,” Schroeppel said.

This week, witnesses and lawyers are wrapping up questioning and testimony in NorthWestern Energy’s request for rate increases and a negotiated settlement signed by the monopoly utility and four other parties.

If approved, the settlement would increase electric rates on residential customers 28% compared to August 2022, according to a filing in the case. That amount would be, on average, $304.32 a year more, an increase some opponents have characterized as “historic.”

Rivas, however, also asked if “mom and pop” stores were part of a group of customers that would see a “substantial rate increase” as well — a group not eligible for any discounts.

“That is currently true,” Schroeppel said.

Compared to current rates, which include an interim increase, the electric bills for that group, identified as “GS-1 Secondary,” would go up 13.58%, according to the settlement.

Some groups that signed the settlement would receive no increase at all compared to current rates, although witnesses said they actually should get decreases based on the amount it costs to deliver them service.

Witnesses for NorthWestern and other parties that agreed to the settlement have testified the deal is fair for all different types of customers — even those who weren’t at the negotiating table.

Rivas is one of the lawyers representing a group of parties that have not signed onto the settlement, the Human Resource Council XI, the Natural Resources Defense Council, and the Northwest Energy Coalition.

In questions, he asked if Schroeppel agreed that the more substantial the increase to rates, the harder the hit to low-income customers. Schroeppel agreed, generally speaking, but also noted some people live in housing where bills remain relatively static.

In the settlement, residential customers would see the highest increase by percent, and the Montana Consumer Counsel is among those that signed onto the proposal.

NorthWestern witnesses have testified the company has programs that help people with their energy bills, like the weatherization program, designed to increase heating efficiency and decrease consumption — and therefore, cost.

But in questions, Rivas pointed out NorthWestern was touting a low-income discount program but not enrolling more people in it. In fact, he pointed to data that showed it was actually losing people during the last 10 years — despite its overall growth in customers and increases in rates.

“While on average, three to five percent of our customers are enrolled in the low-income discount program, we know there are many who qualify who are not enrolled,” Schroeppel said, reading from her testimony as requested by Rivas. “ … To this end, we continually work to increase customer awareness of and participation in the discount program.”

However, a data table from NorthWestern shows that last year, just 13,776 customers were enrolled in the discount program compared to 19,679 in 2012. Rivas said the drop amounts to a roughly one-third of those enrolled over the last decade.

Schroeppel, however, noted some years did see increases; for example, the count rose three years in a row starting in 2016, from 15,966 to 16,513 in 2018.

In a presentation from 2022, NorthWestern touted its growth in customers, and at the hearing, Rivas asked Schroeppel about how it had fared in meeting its goal to help more customers learn about its assistance programs.

“Would you agree that the work to continually increase customer awareness and participation in the discount program that you read from your testimony has not been particularly effective?” Rivas asked.

Schroeppel said she would not agree, and she said engaging customers in low-income programs is a conversation that’s taking place in the industry nationally. She also said enrollment in low-income energy programs is generally lower than it would be in others, such as free and reduced lunches.

“As an industry, we’re trying to figure out what more we can do to get customers to engage in these programs,” Schroeppel said. “But … this is not unique to NorthWestern by a long shot. And in fact, compared to some states that I’ve looked at, our engagement levels are actually pretty respectable.”

Yet in response to Rivas, she confirmed NorthWestern was not proposing any changes in the way it’s reaching out to those customers in the current case “or otherwise.”

According to the U.S. Census Bureau, some more rural counties in Montana have poverty rates among seniors of 14% to 22% or higher; poverty rates have remained generally static based on estimates from 2012-2016 to 2017-2021.

Schroeppel said NorthWestern engages in customer outreach on an ongoing basis, providing information in a newsletter and online, running advertising campaigns, and holding an in-person forum.

She also said staff have been focused on helping people fill out applications for assistance too, especially in advance of the current rate case and in light of the toll inflation is taking on people.

“That’s a large priority for us,” Schroeppel said.

In response to questions from Commissioner Jennifer Fielder, Schroeppel said the utility had seen some “short bursts” of engagement and enrollment upticks now and then, for example, after news coverage of one of its events.

Schroeppel also said some states NorthWestern serves have had more money than demand for assistance, so customers already receiving low-income energy assistance have received additional grants, and 90% of them now have an account credit of an average $650.

However, Fielder asked Schroeppel to confirm the company wasn’t taking steps to estimate the “energy burden” on its customers, or portion of income spent on energy. She noted some members of the public expressed support for the rate increase, but many people were worried about ongoing affordability.

“Does NorthWestern Energy factor in … the impact that those energy burdens have on residential customers when NorthWestern is budgeting or making investment decisions?” Fielder asked.

The PSC regulates monopoly utilities in Montana and is made up of five elected commissioners, currently all Republicans.

Schroeppel said NorthWestern is “extremely cognizant” of impacts to individuals. However, she agreed NorthWestern generally wasn’t calculating the energy burden on customers, but she said the topic is becoming a growing discussion point at the industry level.

“It’s certainly something that we would be willing to talk to the commission about,” Schroeppel said.

The hearing continued into Tuesday afternoon and is expected to be complete by Wednesday at the latest, according to estimates provided in the morning.