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State PBF/ USF History, Legislation, ImplementationNevada In July 2001 Nevada created a funding source to supplement existing low-income energy programs. AB 661 — the enabling legislation — created the Nevada Fund for Energy Assistance and Conservation (FEAC), funded through a mill tax assessment, or Universal Energy Charge (UEC), paid by residential, commercial and industrial customers of the regulated gas and electric utilities in the state. The UEC is 3.30 mills per therm of natural gas and 0.39 mills per kWh of electricity purchased by these customers. The Public Utility Commission of Nevada (PUCN) has been collecting the UEC since August 2001. The PUCN takes up to 3 percent of the UEC for its administrative costs. The remainder is placed in an interest-bearing account of the state Division of Welfare and Supportive Services, the LIHEAP grantee. The Division distributes up to 75 percent of this amount to its LIHEAP, also known as the Energy Assistance Program or EAP, and up to 25 percent to the Nevada Housing Division's Weatherization Assistance Program (WAP). Any accumulated interest is distributed to the EAP and WAP programs. Funds are drawn down periodically as needed by each program thus enabling interest to accrue on the balance. The monthly charge averages about 47 cents on the typical residential electric bill and 16 cents on the typical residential gas bill. For state fiscal year (SFY) 2009, starting July 1, 2008, the UEC generated about $12.3 million. As of July 2002, the Division began using both federal LIHEAP and its FEAC funds to operate an energy assistance program that requires participants to pay no more than a small percentage of their income for energy. The energy assistance benefit, referred to as a Fixed Annual Credit (FAC), is calculated for each eligible household. The FAC is the amount sufficient to reduce the percentage of the applying household's income spent on natural gas and electricity to the state median percentage of household income spent on these energy sources. Both the median household income and the median household energy burden are updated annually for each program year. Nevada’s SFY 10 median household income is $68,646, and the statewide median household energy burden for natural gas and electricity is 2.46 percent of that amount. The following is an excerpt from the state's FY 2010 plan explaining how the FAC benefit is calculated:
The Division imposed FAC benefit cap for the first time in SFY 2009 in order to maximize the number of households served. The benefit cap is based on income, household size, fuel type and poverty level. Any household with an elderly or disabled member, or a child under age six receives an additional $50. Households using heating oil or propane as their energy source have a separate benefit cap from all other energy source users in consideration of the higher cost per British Thermal Unit (BTU) of heating oil and propane. For example, the 2010 maximum benefit for an oil- or propane-heated household of four earning less than 75 percent of FPG was $1,780; for the same sized household earning between 126 and 150 percent of FPG it was $1,421. For those heating with electricity, natural gas or other fuels, the FAC for a household of four earning less than 75 percent of FPG was $1,380; for the highest income level, the FAC was $1,021. If the eligible household’s energy burden is less than 2.46 percent of the household’s annual income, the household may receive a payment of $180 paid with non-UEC monies. Eligible households having a fixed annual credit up to, and including $179, may receive a payment of $180. The FAC portion is paid with UEC funds and the remainder of the $180 is paid with non-UEC monies, which include LIHEAP, state and private funds. All households receiving a FAC will be referred by the Division, via the agency’s computer system, to the Housing Division for energy efficiency services. Only those households that are charged a UEC on their natural gas and/or electricity bill may receive a FAC benefit paid from the FEAC. Eligible households can receive both LIHEAP and FEAC funds, but FEAC funds can only be distributed to a participating UEC vendor. The two funding sources are separate and are disbursed and tracked separately. In cases where eligible households have only non-UEC vendors (electric cooperatives and bulk fuel dealers), the FAC benefit is paid with LIHEAP or other non-UEC funds, up to the maximum amount. Any remaining FAC benefit due will be paid with revenue from other sources, such as state general funding. Eligible households may elect to have their FAC benefit go directly to their UEC heating provider, go directly to their UEC cooling provider, or be equally split between their UEC heating and cooling providers. UEC-eligible households may also receive help with their past due bills under the Arrearage Payment Program. An eligible household may receive an arrearage benefit only once in a lifetime. The only exceptions are households with chronic, long-term medical conditions that create a financial hardship and/or increase the energy consumption of the household. The one-time payment may be for heating or cooling. The household must have paid an amount equal to at least 3.6 percent of its income toward the arrearage during the 12 months in which the arrearage occurred. Energy Conservation For the weatherization portion of the UEC, the Nevada Housing Division spent about $3.7 million in SFY 2009, with 81 percent spent in low-income homes, the remainder on program administration, outreach and evaluation. During SFY 2009,1,107 homes were weatherized with UEC funds and most of the households had vulnerable populations: elderly (57.6 percent), disabled (58.7 percent), high-energy users (39.7 percent), and young children (12.3 percent). Measures included insulation in ceilings, floors and ducts, weather-stripping and caulking, heating and cooling system repairs and replacement, water heater repairs and replacement, and health and safety measures such as carbon monoxide monitors. Evaluations Evaluations have been completed for the first seven years of the UEC-funded energy assistance and weatherization programs (SFY 2003 through SFY 2009) and the 2009 evaluation is available. Initially, the evaluations noted that the Division was still ramping up the energy assistance program and, due to problems with outreach, computer technology and administration, spent less than a quarter of its FEAC during the first two years. By the end of the fourth year, the evaluation reported that problems with implementation and spending had largely been resolved. The 2009 evaluation noted that the program is serving only 10 percent of eligible clients, and that this is considerably less than low-income energy assistance programs in other states; for example, California serves 78 percent of eligibles and New Jersey 49 percent. However, according to the evaluation, no other program is as equitable as Nevada’s in its annual energy burden determination. The evaluators had several suggestions to address the problem of low coverage, including that the PUCN investigate a new low-income rate design that would work in tandem with the current program by offering baseline charges and tiered discounts to those below 100 percent of FPL, and explore the feasibility of striving for 90 percent coverage of Nevadans in need. For more information, including annual plans and evaluations, visit the website of the Nevada State Division of Welfare and Supportive Services. Chapter 702, the Energy Assistance Code, is available at www.leg.state.nv.us/NRS/NRS-702.html Page last updated: October 21, 2011 |