You are here: Home /

State PBF/USF History, Legislation, Implementation

New Hampshire
Last Updated: June 2011
Summary

New Hampshire's Electric Assistance Program (EAP), also called the tiered-discount program (TDP), and its Core Energy Efficiency Programs were implemented statewide during 2002 for customers of regulated electric utilities. The legislature had passed a restructuring law in 1996 that authorized a system benefits charge (SBC) for such programs.

The 2005 legislature continued authorization of the SBC through June of 2008; the 2007 legislature removed that sunset date and continued the programs indefinitely.

The EAP provides eligible low-income customers with discounts of up to 70 percent of their electric bill, depending on household size and income.

The SBC, paid by all electric customer classes, initially totaled 3.0 mills per kWh and was divided between the EAP (1.2 mills) and the Core Energy Efficiency Programs (1.8 mills).

Since March 2005, demand for the EAP has exceeded the number of households to whom benefits could be provided given the EAP funding level. In 2006 and again in 2008, the Public Utility Commission (PUC) revamped the EAP and increased its SBC funding, in order to increase the number of discount recipients. Additionally, legislation in 2005 and 2010 increased EAP funding on a temporary basis, while decreasing it for efficiency programs, allowing the program to provide electric assistance benefits to more customers for a limited period of time (through June 30, 2011).

Enrollment peaked at around 36,000 households in early 2011, with a waiting list of 5,455, and a budget of $16 million. The average discount per household during FY 2010 was $450.

Recognizing that continued growth of the EAP was unsustainable, the PUC in early 2011 approved an order eliminating one of the discount levels within the EAP, reducing its income eligibility maximum from 185 percent of federal poverty guidelines (FPG) to 175 percent FPG, and capping the amount of monthly electric usage eligible for the discount at the first 700 kWh of a customer’s bill. The tier to be eliminated provides a 5 percent discount to customers with incomes between 176 and 185 percent of FPG.

With these changes, the PUC projected that the sustainable enrollment level for EAP will fall to around 33,000, the wait list will be reduced to around 2,500 and the average benefit will go from about $450 to $388.

In a related matter, the PUC released a report in October 2010 on the effectiveness of the SBC program. The report focused on whether the EAP had met the level of need within the limits of the available SBC; whether it conformed to program design guidelines; and whether it operated efficiently. The report concluded that the EAP accomplished those three objectives overall; it also provided some recommendations for the consideration of its advisory board and the Commission, including the changes made through the above-mentioned 2011 order.

Background

On May 30, 2002, the New Hampshire PUC issued an Order, Docket # DE 02-034, explaining its consideration of three different assistance program designs and adopting the tiered discount design. The order stated that the adopted design “strikes the best balance between cost efficiency and program efficiency" and that the program would reach several thousand more households than either of the other two proposals.

The EAP, in effect since October 1, 2002, replaced an interim program, adopted in 1999, which had provided a discount of approximately 25 percent on the electric bills of eligible households. That program served about 13,000 households in 2001, at a cost of $1.1 million.

The tiered-discount program is a modified percentage of income plan. The tiers were originally structured to provide qualified low-income households with monthly electric bill payments equal to, on average, four percent of income for general use customers and six percent for electric heat users. In 2006, the PUC changed that to 4.5 percent for all electric use. Local community action agencies determine eligibility and then identify the discount for each benefit level. Participants must be customers of the following regulated utilities: Public Service of New Hampshire, National Grid, New Hampshire Electric Co-op, and Unitil.

The early EAP also included a one-time pre-program arrearage retirement component for arrearages that were less than 24 months old. Only arrearages existing on or before August 31, 2002 were eligible for retirement. The program paid out over $500,000 in arrears forgiveness during its first three years. It was discontinued prior to FY 2005-06 so that more direct benefits could be paid.

Substantial changes were made to the program effective FY 2007. After asking stakeholders to review the program for possible changes, the PUC issued Order No 24,664 on September 1, 2006, incorporating a new program design that was based on consensus among the stakeholders including utilities, the state community action association and the state utility consumer advocate.

The new design made the EAP a uniform statewide program, rather than utility specific, maintained the program funding level at 1.2 mills per kWh, and expanded enrollment up to 30,000 households annually. The PUC also changed the way EAP benefits were determined in order to take into account a household’s poverty level and household size rather than income alone. As a result of this change and the expanded enrollment, the average EAP benefit was reduced for some households with higher incomes and increased for some with smaller incomes. Their design created six benefit levels ranging from at or below 75 percent of FPG to 185 percent of FPG, with an average annual benefit of approximately $420 compared to over $600 previously.

In May of 2005, partially in response to escalating natural gas prices, the Commission opened an investigation into the benefits of a low-income rate assistance program for natural gas customers. (Around 18 percent of New Hampshire’s low-income households use natural gas as their primary heating fuel.) Both KeySpan and Northern agreed that such a program was needed and that they would work toward implementing it for the winter of 2005-06. Both utilities operate low-income discount programs in Massachusetts and both indicated they could pattern a New Hampshire program after their Massachusetts programs. Keyspan expected about 6,000 of its low-income customers to participate and Northern expected about 1,000.

The New Hampshire PUC on September 1, 2005 approved an order creating a one-year pilot program for qualifying customers of Keyspan and Northern/Unitil. Customers who qualified for one of 13 means-tested programs, including LIHEAP and the EAP, were eligible for the pilot and received a discount of up to 50 percent on the delivery portion of their bill, amounting to about $800,000 during FY 2006. In June of 2006, the utilities and the PUC agreed to continue the program and to no longer consider it a pilot.

Now called the Residential Low Income Assistance Program, it coordinates with the state’s community action agencies to automatically enroll LIHEAP-eligible customers. Participants receive a 15 percent discount averaging about $225 per year; in 2010 program expenditures were about $1.5 million with 9,000 recipient households.

Low-Income Energy Efficiency Program

As mentioned above, the SBC funds energy efficiency programs as well as the EAP. In May 2002, the New Hampshire Public Utility Commission ordered implementation of a Core Energy Efficiency Program for all customer classes for 19 months. It included a $3.1 million low-income energy efficiency program that began June 1.

After the initial program concluded, the PUC has approved program funding each year, with annual funding totaling about $20 million, including about $2.5 million for low-income customers through what’s called the Home Energy Assistance Program. Eligible households can receive up to $5,000 in energy efficiency measures and program services. Households that also qualify for the federal Weatherization Assistance Program (WAP), which is administered through local community action agencies (CAAs), can receive additional energy efficiency measures and program services from a combination of the state and federal funds.

The services provided to low-income customers include insulation, air sealing, new thermostats, electric hot water measures, refrigerator replacement, lighting upgrades, health and safety measures, and a home energy audit and rating (the rating is based on a computer model of the home's relative efficiency). In 2010, about 1,121 units received energy efficiency measures totaling about $2.5 million. The number of units included in Core’s evaluation included those completed and those in the process of being evaluated.

Core officials estimate that the program will have a participation level of 840 in 2011 and 933 in 2012, with yearly budgets of approximately $2.6 million and $2.9 million respectively.

In 2005, the American Council for an Energy Efficient Economy (ACEEE) identified the Home Energy Assistance Program as an “exemplary” low-income efficiency program. It said the program uses holistic practices and state of the art software and data tracking. Because it is delivered by CAAs that also deliver the federal WAP, it leverages several different funding sources, allowing customers to receive more services than they would with a utility-funded program. It also achieves relatively high electricity savings per household, the ACEEE report said, because it prioritizes electrically-heated and other high energy use homes.

When it released its order implementing the Core programs, the Commission also issued an Order of Notice to investigate whether it would be in the public interest to re-institute energy efficiency programs by New Hampshire's two natural gas utilities, Northern Utilities and KeySpan (now EnergyNorth, part of National Grid). On October 2, 2002, KeySpan submitted its Energy Efficiency Proposal for 2003-2005 and Northern filed a final Energy Efficiency Proposal on November 27, 2002. In December 2002, the Commission approved a Settlement Agreement that allows implementation of the natural gas companies' energy efficiency programs.

Specific programs offered by the two utilities include residential low-income audits and up to $3,600 in qualifying weatherization services to eligible households. KeySpan's low-income program began with a $332,823 annual budget and a participant goal of 129. Northern proposed a budget of $48,500 for each program year and estimated participant levels of 17 to 20 per year.

The companies estimate that 283 clients will take part in the programs in 2011, with a budget of $840,895; in 2012, the projected budget is $903,062, and 300 clients are expected to participate.

The utilities proposed some changes in their programs in 2011 and 2012, including serving individually metered multifamily facilities heated with gas. Low-income program budgets have been increased to account for individually metered low-income multi-family facilities and to accommodate the expiration of other funding sources. The companies told the PUC that the increased budget will allow them to serve a similar number of participants as have been served in the past two years.

For more information:

2-year plans (2011 and 2012) for the Core programs and gas utilities

The website of the Core Energy Efficiency Programs describes each utility’s programs.

Return to State Overviews

Page last updated: October 21, 2011