House Democrats' Stimulus Bill Would Nationally Prohibit Electricity Disconnections and Terminations of Service for Non-Payment

Texas PUC To Send Letter To Federal Lawmakers Explaining Concerns With Proposal, Impact On ERCOT Market

May 14, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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U.S. House Democrats have included in their proposed new federal stimulus bill, the Health and Economic Recovery Omnibus Emergency Solutions Act, a national prohibition on the disconnection or termination of electricity service for non-payment

Specifically, with respect to both consumer debt and small business debt, the proposed House Democrats' Act would provide that a debt collector may not, during the COVID-19 emergency and a period thereafter, "disconnect or terminate service from a utility service, including electricity, natural gas, telecommunications or broadband, water, or sewer, for nonpayment."

Under the House Democrats' Act, the term 'debt collector' means a creditor and any other person or entity that engages in the collection of debt, including the Federal Government and a State government, irrespective of whether the applicable debt is allegedly owed to or assigned to such creditor, person, or entity.

The disconnection prohibition would apply through 120 days after the end of the incident period for the emergency declared on March 13, 2020, by the President under section 501 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act relating to the Coronavirus Disease 2019 (COVID-19) pandemic.

The disconnection prohibition would apply to retail electric providers in ERCOT. Furthermore, the prohibition on "termination" of service could be interpreted as prohibiting retail suppliers from ceasing supply service to non-paying customers, even if the customer is dropped to default service and not disconnected (as has been applied in New Hampshire)

Furthermore, the Act would prohibit the imposition of interest or fees on the unpaid balances accrued during the moratorium.

"After the expiration of a covered period, a debt collector may not add to any past due debt any interest on unpaid interest, higher rate of interest triggered by the nonpayment of the debt, or fee triggered prior to the expiration of the covered period by the nonpayment of the debt," the Act states

During today's open meeting of the Public Utility Commission of Texas (PUCT), PUCT Chairman DeAnn Walker noted the inclusion of a disconnection prohibition in various federal stimulus proposals, though Walker did not specifically cite the Health and Economic Recovery Omnibus Emergency Solutions Act

Walker noted that NARUC has raised concerns with proposals for a federal disconnection moratorium, and Walker said that NARUC has encouraged state utility regulators to send letters to federal lawmakers explaining such concerns

Walker noted the impact that a proposed federal utility disconnection moratorium would have on the ERCOT market, saying that it would cause "significant issues"

PUCT commissioners agreed to send a letter to federal lawmakers, including Congressional leadership as well as the Texas delegation, explaining such concerns

See the proposed House Democrats' bill here

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