Utility Low Income Payment Assistance Program Models Vermont Low Income Working Group August 8, 2006

Straight Discount Specified discount taken from total bill –Customer charge reduction –Usage charge reduction –+ Ease of Administration –- no targeting of benefits within participant group

Consumption-based Discount (inclining block rate) Percentage of discount varies depending on level of usage + incentive to conserve or use energy efficiently - low “cutoff point” potentially harms elders and others with temperature-related health and safety risk

Percentage of Income Payment Plan (PIPP) Household pays a pre-determined, “affordable” percentage of income for home energy service + targeting of benefits within participation group - relatively high administrative cost

PIPP Variations Straight PIPP –Difference between “affordable” bill and actual bill made up through payment assistance funds Percentage of Bill –Consumption-sensitive

Tiered Discount Assistance targeted to household income or poverty level Higher percentage discount for households with lower income (or lower income to poverty ratio) + targeting of benefits + moderate administrative expense

Arrearage Management Treatment of past bills One-time credit Reduction of past due amounts over time based on payment of current bills Comprehensive approach to affordability