Central Maine Power (CMP), Maine’s largest electric utility company, has sent 62,000 disconnection notices to Maine residents since April 1 informing them their service will be cancelled if they can’t pay down their accounts.
That’s about 10 percent of all Maine households, a startlingly high number that suggests Mainers are still struggling to cope with economic disruption of COVID-19 lockdowns and the soaring energy costs of 2022.
“This is something that’s been brewing because of COVID-19 and the hold that was placed on these notices,” said Rep. Steve Foster (R-Dexter).
“It’s coming to a head now,” Foster said.
CMP suspended normal billing for most of the COVID-19 public health emergency. And, in normal times, the company is not allowed to shut off power during winter months because of regulations from the Maine Public Utilities Commission (MPUC).
But the company resumed normal billing practices at the beginning of April.
As part of that practice, MPUC requires CMP to send multiple communications to customers documenting their non-payment.
This is because those bills, if they’re not paid, will eventually be included in the bills of all other ratepayers.
But before that happens CMP must show that they attempted to collect on those delinquent accounts in order to justify a rate increase to MPUC.
Jonathan Breed, a spokesperson for CMP parent company Avangrid, said only five percent of customers who have received disconnection notices this year have actually had their power turned off, and most of those have subsequently had their power restored.
“Our goal is not to disconnect,” said Breed.
“Rather, we want to work with customers to resolve billing issues through payment or though available assistance programs,” he said. “Resolving past-due bills benefits all customers, as the burden of unpaid balances is shared by all ratepayers.”
At least some of these disconnection notices are a byproduct of skyrocketing heating oil costs.
Some Mainers will change their heating strategy when the price of Number 2 heating oil runs high, as it did last year.
Rather than run the oil-burning furnace, they will rely on electricity — like the heat from an electric oven, plug-in electric space heaters, or electric heat pumps.
That, in turn, will result in a higher bill from the power company.
Foster, the House Republican lead on the Energy, Utilities and Technology Committee, said other policy choices made by elected officials have also caused energy prices to increase in recent years.
Foster said part of the problem is net energy billing, a program that aims to encourage the development of small-scale solar power projects. In 2019, net energy billing was modified to include larger community solar projects.
Instead of raising taxes to fund subsidies for the solar industry, a move that might have been unpopular with voters, lawmakers created an arrangement in which the power companies collect higher fees from customers and redistribute that money to solar operators.
Hidden away on an energy bill as a “stranded cost” line item, the price Mainers pay to prop up the solar community is less visible than an outright tax.
While it’s not technically a tax, net energy billing functions in the same way.
“The net energy billing for solar has already increased costs,” Foster said. “As more of those projects come online, costs will go up more.”
“One might say, well if we’re going to do that, let’s put it into taxes so everyone is paying for it,” he said.
Foster has introduced a bill, LD 1347, that would eliminate net energy billing, but it’s not expected to garner support from many Democrats.
According to the Office of the Public Advocate, net energy billing is projected to cost Maine ratepayers $220 million by 2025.
Those costs will be collected by CMP and Versant, Maine’s other large electricity company, but they don’t benefit either business’s bottom line.
CMP’s spring wave of disconnection notices arrives as CMP and Versant are fighting a political battle against activists behind the “Our Power” ballot initiative campaign.
That campaign aims to place the operation of Maine’s power utilities under state control via the “Pine Tree Power Company.”
It would do so by forcing CMP and Versant to sell their businesses to PTPC at a “fair price, with no tax money or state bonds,” the campaign claims.
“Rather, Pine Tree Power will issue its own bonds, borrowing at the low rates against the bills we all pay,” the group’s promotional flier says.
The new not-for-profit company would be controlled by a board comprised in part of elected representatives.
But it would almost immediately have to hire an existing for-profit firm to operate the utility.
The Our Power activists haven’t published any plan for how they might improve over the services offered by CMP and Versant.
Nor have they identified areas where they might decrease costs, which is an important question considering PTPC would begin with massive debt related to the acquisition.
Moreover, the ideological vision behind “Our Power” isn’t primarily lowering energy costs.
Instead, the group views the ballot initiative as a way to further boost the very renewable energy projects that have increased electric rates in the first place.
However, the idea that merely placing the utilities into a “non-profit” structure would lower rates by eliminating capitalist profit incentives may prove attractive to voters. And the arrival of disconnection notices landing in the mailboxes of Maine’s poorer residents will provide fuel to the populist campaign’s claim that CMP and Versant are overcharging customers.
Jim LeBreque, a former lawmaker who follows energy issues closely and opposes the Our Power project, said he heard about an older woman who received a $3,000 bill last week.
The woman is on fixed income and has no idea how she’ll pay the debt.
Residents can work out payment arrangements with CMP, but if the bills aren’t paid, eventually the lights go out.
Subsequently, those stranded costs will be paid by other ratepayers.
Like Foster, LeBreque said one of the primary culprits for soaring energy costs is the creation of net energy billing.
“Net energy billing is making poor people pay more to rich out-of-state investment firms putting up all the solar, out-of-state contractors, and the Communist Chinese,” said LeBreque.
A Maine Wire investigation found that a Maine Department of Transportation solar project in Augusta relied on a sub-contractor whose supply chains have been linked to forced labor in western China.
The industry has long been accused by non-governmental organizations and western governments, including the Biden Administration, of doing too little to ensure the manufacture of solar panels isn’t supporting human rights abuses.