CenterPoint proposes to suspend inverted block rate program

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Texas-based CenterPoint Energy announced that it plans to halt its inverted block rate program, pending further study and a commission order subject to approval by the PUC.

The action is in response to a request that the Attorney General’s Office previously filed with the Public Utilities Commission (“PUC”) to suspend the program.

CenterPoint, with 718,000 residential customers, is the largest natural gas supplier in Minnesota.

On June 1, 2011, Attorney General Swanson filed comments with the PUC, citing that inverted block rates seem to be financially punishing some people who have taken steps within their budgets in a bad economy to make their homes energy efficient or who cannot afford energy upgrades, and others who need to use more energy for various reasons, such as senior citizens who consume more energy because they are home all day or need warmer living environments; people with medical conditions who need to stay warm; lower income people who cannot afford energy upgrades or who live in drafty homes; and people with larger families or whose family members are at home more, such as those with young children, stay at home parents, those who work from home, and parents whose adult children have moved back home as a result of the recession.

Although the program was originally promoted as a plan to reduce energy use and increase efficiency, the Attorney General’s Office heard from consumers across the state – from the inner cities to the suburbs to rural areas – about these unintended consequences that appear contrary to the stated goal of the program.

Attorney General Lori Swanson issued the following statement: “With cold weather right around the corner, it will be good if ratepayers are not subjected to another year of a program with indiscriminate and unintended consequences.”

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