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Consumer Rights & Responsibilities, Protections

Energy Regulatory Partnership ProgramAbuja, Nigeria

July 14-18, 2008

Robert W. Kehres Director, Regulatory Affairs DivisionMichigan Public Service Commission

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• MPSC developed the Consumer Standards and Billing Practices for Electrical and Gas Residential Services Rules

• Purpose of rules:Provide protection from utility practices harmful to

residential customers

Determine utility company and customer rights and responsibilities

Consumer Rights Responsibilities and Protections

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• Residential gas and electric customers have the right to have:Safe and reliable serviceFair and equitable treatmentUtility meters read accurately monthlyAccurate bills by mail or electronically (if company can

provide)Prompt and courteous handling of questions and /or

problemsProtection from unfair security deposits or guarantee

terms and conditions

Customer Rights

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• Customers also have the right to energy assistance programs:– Budget Billing Plans– Winter Protection Program– Home Heating Credit– Earned Income Credit– State Emergency Relief Program– Medical Emergency– Protection for Active Military Duty– Weatherization Assistance

Customer Rights (Continued)

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Customer Protections

Budget Billing Plans

CONTACT: Local utility company

Offered by utilities (required by the MPSC) Assists customers with household budgets Allows customers to pay their estimated annual bill in equal

monthly payments Review is done at the end of 11/12 months and monthly

payment amount may be adjusted up or down

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Heating Assistance Programs

Winter Protection Plan (WPP)

CONTACT: Local utility company

Required by state law and MPSC rules Low income and senior citizens will not be shut off during heating

season if they meet the requirements Heating season is November 1 – March 31 Pay all amounts not paid during heating season in summer months

Customer Protections (Continued)

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Winter Protection Plan (WPP)Benefits Low Income Customers

CONTACT: Local utility company

Income at 150% of Federal Poverty Level Pay 7% of estimated annual bill each month November 1 –

March 31 Pay 1/12 of past due bills at enrollment November 1- March

31 Shutoff protection for natural gas and electric service Can be used to restore or initiate participation in the program.

Pay 1/12 of past due bill but no deposit or reconnect fee

Customer Protections (Continued)

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Winter Protection Plan (WPP) Income Guidelines 2007-2008

Household Members Maximum Income 1 $15,315

2 $20,535

3 $25,755

4 $30,975 5 $36,195

6 $41,415

7 $46,635

8 $51,855

Add $5,220 for each additional household member

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Winter Protection Program (WPP) for Seniors

CONTACT: Local utility company

Notify company if 65 or older Enroll between November 1 and March 31 No specific payment amounts required Encouraged to pay what they can. Must repay amounts owing at end of shut off protection period Payments can be spread from April to beginning of next

heating season (November 1)

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Customer Protections (Continued)

Home Heating Credit (HHC)

CONTACT: Michigan Department of Treasury or Local utility company

Administered by MI Department of Treasury Income guidelines (extra exemption for seniors and disabled

persons) Customer must complete form to get credit but not required to

file income tax form Local agencies and sometimes utilities will help complete form Shut off protection provided while form being processed by

Treasury

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Customer Protections (Continued)

Home Heating CreditIncome Guidelines

HouseholdExemptions Income Ceiling

1 $11,243 2 $15,072

3 $18,900 4 $22,729 5 $26,558 6 $30,386

For each exemption over 6 add $3,829

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Customer Protections (Continued)

Earned Income Credit (EIC)

CONTACT: Internal Revenue Service (IRS)

Administered by IRS Federal income tax credit for low-income working individuals

and families Do not have to owe income tax to qualify but you must file

federal income tax return If raising qualifying child in home, may be able to get part of

credit in your paycheck during the year with Advance EIC

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Customer Protections (Continued)

Crisis Assistance Program (State Emergency Relief)

CONTACT: Michigan Department of Human Services (MDHS)

Do not have to be an MDHS client Must meet income guidelines but do not have to be DHS

client Year round help available Assists households with heat or electric shutoff notice or who

need deliverable fuel

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Customer Protections (Continued)

Medical Emergency Protection

CONTACT: Local utility company

Required by MPSC rule Protected from shutoff of electric or natural gas up to 21 days Must have doctor or public health official statement re: nature of

emergency and time shutoff will aggravate emergency Shutoff may be extended up to 63 days with additional certificates Annually extensions may be up to 126 days per household If shutoff without postponement utility shall unconditionally restore

service for not more than 21 days not to exceed 63 days for a household member

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Customer Protections (Continued)

Customers on Active Military Duty

Required by state law and MPSC rules. Customer or spouse of customer called to full-time active

duty may request shutoff protection up to 90 days with extensions.

Required to repay entire amount billed within 12 months.

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Customer Protections (Continued)

Weatherization Program

Contact: Local Community Action Agency

Federally funded, free conservation services to low-income Helps reduce energy use and lowers utility bills DHS clients and individuals at 150% of Federal Poverty Level

eligible May include:

Caulking and weatherstripping Wall, basement and attic insulation

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Demand Response

Energy Regulatory Partnership ProgramAbuja, Nigeria

July 14-18, 2008

Ikechukwu N. Nwabueze, Ph.D.Director, Regulated Energy Division

Michigan Public Service Commission

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Definition of Demand Response

• The reduction of customer energy usage at times of peak usage in order to help address system reliability, reflect market conditions and pricing, and support infrastructure optimization or deferral.

• Programs may include dynamic pricing/tariffs, price-responsive demand bidding, contractually obligated and voluntary curtailment and direct load control/cycling.

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Smart Power Grid

• General concept for the process of transforming the nation’s electric power grid into an intelligent network by applying computers, electronics, and advanced materials to implement advanced communications, automated controls and other forms of information technology to improve the economics, reliability and safety of the grid.

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20th Century Grid 21st Century Smart Grid

Electromechanical Digital

One-way communications (if any) Two-way communication

Built for centralized generation Accommodates distributed generation

Radial topology Network topology

Few sensors Monitors and sensors throughout

“Blind” Self-monitoring

Manual restoration Semi-Automated restoration and, eventually self-healing

Prone to failures and blackouts Adaptive protection and islanding

Check equipment manually Monitor equipment remotely

Emergency decisions by committee and phone Decision support systems, predictive reliability

Limited control over power flows Pervasive control systems

Limited price information Full and transparent price information

Few customer choices Many customer choices

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Advanced Metering Infrastructure (AMI)

• Enhancements to transmission-level developments, which improve grid stability

• Enable demand response programs at a customer level

• Michigan utilities are investigating AMI as a platform to implement demand response programs and other Smart Grid initiatives

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No Major Utility in the USA Has Yet Deployed Full AMI

• Full AMI includes an in-home wireless network allowing real-time two-way communication between the utility and customers.

• Enabling technology consists of the following:– Internet accessed consumption and price data– Programmable communicating thermostat– Intelligent appliances– In home monitor– Pre-paid services

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AMI/Dynamic PricingCreates a Workable Path

to the Smart Home … Through Enabling

Technologies

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PHEV Integration

Energy Storage

A/C Water Heater

On-line Energy Management

Two-way Information

Power Flow

Digital Kitchen

Solar Integration

Thermostat

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Manual meter reading Monthly kWh reads

Automatic MeterReading (AMR)

> One-way or two-way> Monthly kWh reads> Interval data> Basic theft detection> Outage/Restoration Detection

Advanced Metering Infrastructure (AMI)

> On-demand reads> Programmable loadintervals> Bi-directional and net metering> Time of Use, Real Time Pricing, Critical Peak Pricing options> Demand response

Smart Meters

> Solid-state platform Integrated communications> Integrated disconnect switch> Remotely disconnect> Remotely connect Power quality data> Voltage readings> Current readings> Power Factor> Frequency> Detailed power outage data> Remote programmable> Remotely upgradeable> Internal expansion port> Future functionality

Utility of the Future

Energy ManagementServices> Residential, Commercial Home area networkgateway> PLC (i.e. LONWORKS)> RF (Bluetooth) Web-based applications> Demand response> Prepayment> Load control> Revenue protection> Web move in/out Distribution> Load profiling/engineering> Phase balancing> Transformer optimization> Energy forecasting> Outage and GIS> Work force management> Asset management

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Pilot Programs/Research

• Inexperience combining utility AMI technologies with innovative dynamic pricing structure.

• Voluntary experimentation through the use of pilot programs prior to widespread adoption.

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AMI Pilots and Standards

• Pilots are scheduled to commence in 2008

• Commission guidance is needed to establish:– Minimum functionality criteria and standards

necessary for the rate recovery of this infrastructure development

• Flexibility is critical to allow efficient smart grid infrastructure development for AMI and other smart grid developments

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Investigation of Minimum AMI Functionality Standards

• Commission invited comments on preliminary questions (Commission Own Motion in Case No. U-15620):– How should costs & benefits to utilities and

customers be considered?– To what extend should advanced-metering

technologies and functions be standardized and utilities be able to select functions on behalf of customers?

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Investigation of Minimum AMI Functionality Standards (Continued)

– Should functionality standards and criteria on AMI deployment approaches, technologies and functions be prescribed?

– To what extent should standard protocols produced by advanced meter output be prescribed?

– Should the Commission establish minimum functionality for the recovery of AMI investment by utilities?

– Has open architecture been successfully implemented elsewhere? If guidelines are prescribed, what should they say?

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– Should guidelines to deal with information transmission and storage issues be prescribed?

– Should it require a pilot project or gradual deployment of advanced meters, in recognition of the volume of information that the market participants will have available from advanced meters?

Investigation of Minimum AMI Functionality Standards (Continued)

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AMI Case

• Commission’s Own Motion, Case No. U-15620• Investigate development of minimum

functionality standards and criteria for advanced metering infrastructure

• Public comments due August 1, 2008• Staff shall summarize findings and file a report to

the Commission by August 29, 2008

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Questions?