Rhode Island

Restructuring Overview  |  Public Benefits  |  Restructuring Resources  |  Consumer Protection

Legislation Passed
Electric Y Gas N

1996, Chapter 316, HB 8124; Utility Restructuring Act of 1996
2002 H7786 B, revises standard offer and aggregation stipulations

Electric
Overview

• 1997: Retail competition in Rhode Island was phased in, beginning in July 1997. Competition brought three customers options: standard offer service, last resort service, and competitive market supply. All utility customers as of January 1, 1998, and any new customers who entered the state after that date could take standard offer service. This provides an option for those customers who do not wish to enter the competitive market. Last-resort service provides an option for those who try competitive supply and then decide to leave the competitive market.
• Before deregulation, there were three utilities in Rhode Island -- Blackstone Valley Electric, Newport Electric, and Narragansett Electric, the largest provider. With competition proving a threat to the two smaller utilities, National Grid subsidiary Narragansett Electric bought them both. Under deregulation, Narragansett's rates are capped until 2010 but will slowly rise each year.
• 2002: H 7786B, the first major revision of the state's six-year-old restructuring law, allows customers on the so-called "last-resort" service to return to the standard offer. These are customers who left Narragansett Electric to buy power from another supplier but decided, or were forced, to return to the utility company. Before the bill passed, customers could have returned to standard offer service only if the Public Utility Commission held a hearing and determined that there weren't enough competitive choices in the marketplace.
• June 2003: The PUC approves an 18 percent increase in standard offer rates.

Choice Status

• All customers had access to electric choice by July 1998. Residential users began entering the market late in 1998 and early 1999, a trend that peaked in September 1999. By the 2^nd quarter of 2000, competitive supply dropped back to about one-tenth of its 1999 peak, and that trend has not changed. At this point, access to competitive suppliers is practically nonexistent for residential customers.

Natural Gas
Overview

• Rhode Island has no supplier choice programs for residential customers. The state's two local gas distribution companies have voluntarily given certain customers supplier choice since 1997. Providence Gas offers supplier choice to customers using at least 500,000 Mcf per year, and Valley Gas provides choice to customers using 10,000 Mcf or more.

Public Benefits

Rhode Island's restructuring law provides that costs for low-income assistance and weatherization programs "shall be included in the distribution rates charged to all other customers." A demand-side management program established in 1997 includes programs for residential, commercial and industrial customers, and renewable energy projects, funded through a system benefits charge. The 2001 state legislature approved an extension of the program through 2007. Low-income energy efficiency programs and rate discounts amounting to about $6 million yearly are funded in rates, not the system benefits charge. The state's average annual fund from system benefits charges is $16.5 million. Of that, $14 million is used for energy efficiency programs and $2.5 million for renewable energy programs. (Click here for details on the state’s low-income energy and general residential energy programs.)

Aggregation - buying coops

• A major electricity measure passed by the Rhode Island General Assembly in 2002 gives cities and towns the authority to buy electricity for their citizens. Voters in each community must approve the aggregation plan. To put the issue on a ballot, a municipality must have a potential deal with a marketer.
• An aggregator is considered a nonregulated power producer. All nonregulated power producers must file evidence of financial soundness and cannot do business in the state unless its registration becomes effective and remains in good standing.
  

State Restructuring Resources

Utility Regulatory Commission
Public Utilities Commission
1-401-941-4500
www.ripuc.org/

Grassroots groups
ACORN
1-401-780-0500
www.acorn.org
ACORN, the Association of Community Organizations for Reform Now, is the nation's largest community organization of low- and moderate-income families. Energy is among its priorities. The group lobbied to help low-income household in Rhode Island get gas services turned back on after high energy prices led to numerous shutoffs.

Consumer Protection

Disconnection policy

• Between November 1 and March 31, no gas or electric public utility or supplier can terminate service to any residence for nonpayment of a delinquent account, where such service is the primary source of heat, except when the delinquent balance of the account exceeds $500 and, where such service is not the primary source of heat, when the delinquent balance exceeds $200. Also protected during that time are the unemployed, elderly and handicapped and people eligible for public energy assistance aid.
• Utilities must delay disconnection of residential service for up to 21 days if a physician certifies that a household resident is seriously ill. If the duration of the illness exceeds 21 days, the customer may request a review to determine if the delay can be extended.
• Utilities and suppliers may terminate customers for non-payment if a bill is not paid within 40 days after it is received or if a payment plan is not met. Service cannot be terminated for nonpayment unless the customer has been sent written notice of the public utility's intention to disconnect at least 10 days before the proposed disconnection. In addition, the utility must attempt to notify occupants by posting a notice of shut off on the premises in a conspicuous place or by delivering notices of shut off.
• Service cannot be disconnected on any Friday, Saturday, Sunday, legal holiday, or day before any legal holiday, or at any time when the public utility's business offices are not open for business. Service may be disconnected only between the hours of 8:00 a.m. and 4:00 p.m. of the date specified in the notice or within a reasonable number of days thereafter.
• The utility must have personnel available until 5:00 p.m. or 3 hours after the time of shut off, whichever is later, authorized to reconnect service.
• After a shut-off of either gas or electricity, a household cannot be charged any more than 25 percent of the back bill in order to regain service.

• Utilities must offer residential payment plans to customers in danger of having their service disconnected for nonpayment.
• Protected Status customers are required to pay at least one-twelfth of the unpaid balance and current usage or one-twelfth of the estimated annual usage for each month during enrollment.
• Customers who do not qualify for Protected Status are required to pay at least one-twelfth of their estimated annual usage plus one-sixth of the overdue balance for the first six months of the 12-month payment plan.

Billing and collections

• Customers can choose whether to receive a separate bill from the distribution company and the supplier, or a single combined bill.

Supplier licensing

• Power distribution company are required to propose and file a set of accounting, billing, metering and settlement (ABMS) procedures designed to implement retail access for Rhode Island customers. Suppliers who contract with the distribution companies are then required to show how they will meet these ABMS procedures.
• Suppliers most provide evidence of financial soundness.

Dispute resolution

• Customers who feel they have been billed incorrectly should contact their utility, which is obligated to thoroughly investigate the matter and report the results to the customers. Customers dissatisfied with the utility's response may request a supervisory review by the utility. If the billing dispute cannot be resolved after the supervisory utility review, customers may contact a reviewing officer of the Rhode Island Division of Public Utilities and Carriers' Consumer Section.