National Fuel Gas Distribution to Make Low Income Discount Competitively Neutral

National Fuel Gas Distribution Corporation has filed tariffs with the New York PSC to essentially "unbundle" one of its current low-income assistance programs, to allow customers served by ESCOs to receive service under the program as they would if they were sale service customers.

Distribution currently offers an expanded low income assistance program (under SC 2, Low Income Residential Assistance Service, LIRA, and expanded LIRA, ELIRA) which is a straight discount service available for customers who received an emergency payment under the Federal Home Energy Assistance Program (HEAP).

ELIRA currently is a bundled sales service, with no provision for unbundled delivery, or transportation service. Consequently, customers currently served by ESCOs would not qualify for ELIRA, even if they received an emergency payment under HEAP, unless they elected to cancel their ESCO contract and return to utility sales service.

The purpose of the filed tariff amendment is to revise Service Classification (SC) No. 2, ELIRA, to authorize application of the ELIRA discount to bills issued by Distribution for customers served by ESCOs. More specifically, the proposed revisions unbundle the LIRA service by authorizing transportation of ESCO-supplied natural gas. "This change would enable customers served by ESCOs to qualify for the resulting LIRA transportation service, and therefore receive the same LIRA discount currently provided for eligible sales customers," Distribution said.

The proposed amendment further conforms SC 2 to Distribution's other, unbundled sales services by requiring use of Distribution's consolidated billing service, and by inserting a provision authorizing Distribution to, under special circumstances, charge returning sales customer a published, incremental cost of gas.

"The proposed amendment, if approved, would (a) improve comparability between utility and ESCO delivery charges; and (b) provide bill relief to low-income customers served by ESCOs. For customers served by ESCOs who charge supply rates higher than Distribution's supply rates, a 'portable' ELIRA discount has heightened value because ESCO customers may be unable to 'switch' to utility-provided ELIRA service due to contractual obligations enforced by marketers," Distribution said.

ESCO customers who are eligible for the ELIRA discount will be notified by a bill message that will accompany the rate discount at the time that it is automatically applied. The customers will not be required to contact Distribution or complete an application to receive the discount.