Newly approved utility bill relief will help customers facing financial hardships.
Today, the Austin City Council approved emergency actions providing relief to Austin Energy and Austin Water customers. Two weeks ago, City Council asked the utilities to explore ways to reduce the impact of utility bills as our community stays home to help reduce the spread of the coronavirus. The resulting changes will provide approximately $46 million in utility bill relief for City of Austin Utilities customers, from now through Sept. 30, 2020.
“Austin Energy is part of this community, and we must do everything we can to reduce costs for customers who are helping our community by staying home,” said Jackie Sargent, Austin Energy General Manager. “We’re also making sure those who have suffered a loss of income during this unprecedented crisis can come to us for additional utility bill assistance.”
Austin Water Director Greg Meszaros echoed the same sentiment. “During this challenging time for our community, we at Austin Water recognize that we are all in this together,” he said. “This plan will help customers facing financial hardships in the months to come with immediate utility bill relief.”
The utilities are providing this assistance through two methods – Rate Reductions and Customer Assistance Programs.
Residential customers are likely seeing higher electricity and water usage as a result of staying home. The following rate changes will help customers avoid higher bills at a time when many can least afford it.
Reduction in Austin Water rates for all residential customers
In recognition that greater assistance is needed for all residential customers, Austin Water will provide a 10 percent reduction in residential water (Tiers 1-3) and wastewater (Tiers 1-2) volume rates, which is projected to provide an estimated $6 million in utility bill savings. Most residential customers will see immediate savings on their water bill.
Reduction in Austin Energy residential and commercial Regulatory Charge
Austin Energy is reducing Regulatory Charges by $25 million. This change will help both commercial and residential customers, saving them roughly 4 percent on their electric bills. The Regulatory Charge recovers Austin Energy’s share of the statewide costs associated with the transmission grid, as well as other regulatory fees.
Austin Energy reduction of rates for all residential usage over 1,000 kWh
Austin Energy is reducing all residential customers’ rates at higher consumption levels. This action is temporarily setting residential electric rates at $0.07814/kWh for all usage above 1,000 kWh. Existing rates were designed to send conservation price signals to customers. However, at this time, customers have less control over whether they may hit higher tiers, causing bills to increase more dramatically. This action provides relief for customers whose consumption increases as a result of Stay Home – Work Safe.
Customer Assistance Programs
The City of Austin Customer Assistance Programs (CAP) help utility customers facing temporary and long-term financial difficulties, as well as those with serious medical problems. The Utility Bill Discount Program and the Plus 1 Financial Support Program provide direct, targeted relief to the most vulnerable customers experiencing hardship in paying utility bills. With so many customers financially impacted by COVID-19, Austin Energy and Austin Water are making enhancements to these programs.
Additional financial contributions to Plus 1 Program
Austin Energy and Austin Water will each allocate an additional $5 million, a combined $10 million, to the Plus 1 financial support program. This will result in a grand total of $12.3 million in Plus 1 assistance for City of Austin Utilities customers in FY2020.
Customers experiencing financial hardship due to the effects of COVID-19 are now eligible for the Plus 1 Program. The utilities are also making programmatic changes, focusing on responsiveness and flexibility for quickly verifying eligibility and enrolling customers with a financial hardship.
Austin Energy increase in CAP discount
Austin Energy is increasing the utility discount provided to CAP electric customers from 10 percent to 15 percent. As before, CAP customers will not pay the $10/month Customer Charge and the CAP portion of the Community Benefit Charge. This action is estimated to provide $1 million in additional support for CAP customers.
Austin Energy also seeks to enroll more customers who are eligible for CAP under recent program expansion. Customers with household incomes at or below 200 percent of the Federal Poverty Level may now receive the CAP discount.
Austin Water reduction in CAP water rates
The 10 percent reduction in residential water (Tiers 1-3) and wastewater (Tiers 1-2) volume rates outlined above also applies to CAP customer water rates.
This immediate assistance is in addition to City of Austin Utilities’ efforts already underway to stop all utility disconnections, waive late fees and place every customer in need on a payment arrangement that meets their financial needs. These changes ensure that those experiencing significant hardship due to the unprecedented coronavirus pandemic get relief on their utility bills. The City of Austin will continue to respond to customer needs and make further recommendations for bill relief, as needed.