CenterPoint: Affordability doesn't mean 'all customers can afford the bill'

EVANSVILLE – In official state filings, a CenterPoint official called affordability concerns residents expressed at a recent field hearing “extreme scenarios,” and dismissed the notion that CenterPoint is more unaffordable than any other Indiana utility.

Elsewhere in the testimony, he praised his own company for potentially reducing a proposed bill increase by nine cents a month, and said affordability can only be “easily addressed” in a “utopian world.”

All of this testimony was from Richard C. Leger, the senior vice president of CenterPoint's Indiana electric branch. He filed it with the Indiana Utility Regulatory Commission this month as CenterPoint continues to advocate for increasing the average base rates of Evansville-area electric bills by around $50 a month. For some customers, the jump would be even higher.

Locals already pay the highest residential electric bills in the state: something that was made apparent on Feb. 29, when more than 70 Evansville-area residents and elected officials took to the mic and begged the IURC to reject CenterPoint's proposal.

Due to CenterPoint's monopoly in the Evansville area, customers called themselves "hostages." Some said they had to choose between paying their surging utility bills and buying groceries and prescriptions.

CenterPoint's testimony attempts to rebut concerns from residents

Affordability is one of the five pillars of Indiana's energy policy, something several residents brought up in their testimony. But Leger said that doesn't mean CenterPoint has an obligation to ensure "all customers can afford the bill."

Instead, he said, energy is meant to be affordable and competitive across customer classes − residential, industrial and commercial.

"In a utopian world, affordability would be easily addressed," he says in the testimony. "That said, affordability is a complicated matter that crosses all socioeconomic factors and means many things to many different people."

Leger states in his testimony that he attended the field hearing Feb. 29, and that there was passion from those who spoke.

"We listened carefully, and understand the public sentiment presented," he stated. "A common theme emerged around affordability, or lack thereof, as it relates to their utility bills."

Yet, Leger's testimony to the IURC is specifically meant to rebut the comments from the public, as well as those from the Office of Utility Consumer Counselor.

Leger states a bill analysis CenterPoint performed showed the "extreme scenarios" testified to at the field hearing were not the normal situations customers were in. Those allegedly "extreme" examples included stories from retirees on fixed incomes, families with special-needs children and local officials asking for some relief for their constituents.

Cliff Payton said he's supposed to be enjoying his retired years, not struggling with CenterPoint bills despite having a paid-off home and only some medical debt to contend with.

"I'm not suicidal, but I've made the comment, 'Death's starting to look pretty good to me,'" Payton said at the hearing. "And I would have never, ever dreamed I would be feeling that."

Then there was Louise Johnson, whose 4-year-old son Anthony has a rare form of spinal muscular atrophy that requires a ventilator to keep him breathing. Since that ventilator depends on electricity, it’s crucial that Johnson and her family never face utility disconnection.

“We’re down to one income and I don’t know how we’re going to make it,” she told the Courier & Press after she spoke in front of the IURC. “Today we’re OK, but next month I don’t know. Feeding the boys … I haven’t ate today. It’s almost 11 o’clock (p.m.) and I haven’t ate.

“… You can’t afford medical equipment, food and electricity. You have to pick.”

'We've given great consideration to affordability'

Leger said Citizen Action Coalition program director and its witness Benjamin Inskeep, who spoke against the increase on behalf of residents, attempted to imply CenterPoint's rate case disregards affordability.

"I do believe that we have given great consideration to affordability," Leger stated. "Several of our witnesses discuss affordability and the measures that we have taken to control costs over the 14 years since we last filed a base rate adjustment."

Leger said the utility also tries to help those who struggle to pay their bills by attending access-to-service fairs, promoting bill assistance programs, supporting the Low-Income Home Energy Assistance Program and offering payment plans.

Under a question asking how the company has taken "other steps" to address high costs, Leger mentions efforts to offset costs in yet another rate case: this one concerning CenterPoint's attempt to recover money from renewable energy projects. They would do that by charging customers more.

But he said CenterPoint "accepted" an OUCC proposal to adjust expenses in the project.

"Together, the ... adjustments, if approved by the (IURC), would reduce (CenterPoint's) proposed recovery in the (case) by approximately $287,000 and would reduce the proposed residential bill impact of the (filing) by approximately $0.09 per month," he states.

He also doesn't believe CenterPoint is less affordable than other utilities, despite years of state data that say otherwise. He claims his position is backed up by disconnect for non-pay data that shows their rates are no more or less affordable than their Indiana peers.

According to disconnect data provided by the OUCC, CenterPoint South disconnected 6,633 customers in 2023. Expanding out to the 16 months as Leger stated, CenterPoint South disconnected 7,409 customers. The data does not break down if any disconnections were repeats.

The height of disconnections occurred in June 2023, with 931 customers having their electricity turned off.

That same month, CenterPoint sent disconnect notices to about 12% of its residential electric accounts, with 17,176 notices beings sent on 132,384 accounts.

In each of those 16 months, aside from November 2023, more than 1,000 CenterPoint South customers were on active payment arrangements. And in the same time frame, disconnect notices – or warnings that people could lose service if they don't pay – sent on a monthly basis were never fewer than 17,167.

"After reviewing the disconnect for non-pay data that was provided to the OUCC and posted on their website on April 1 of this year, I found that we disconnected 0.35% of our residential customers over the 16 months of data provided," Leger said. "When compared to the other (Indiana investor-owned utilities), we are in line with or below the DNP rate of our peers."

The average, though, sidesteps the number of disconnections themselves. Over that 16-month period, CenterPoint reported 7,409 disconnections. In the worst month – June 2023 – 931 households had their electricity cut. According to the National Weather Service, the average high temperature that June was almost 87 degrees, with eight days that reached 90 degrees or hotter, leaving those residents without power during some of the hottest days of the year.

But disconnections aren't a sole indicator of affordability, according to the OUCC.

The OUCC's Director of the Electric Division, Mike Eckert, testified CenterPoint South continually ranking highest in the electric residential bill survey is a major concern.

"Unfortunately for ratepayers, CEI South or Vectren has ranked highest for this metric for 13 consecutive years," Eckert testified, "with each survey from 2011 to 2023 showing (CEI South) had the highest such bill among all electric utilities under the commission’s jurisdiction."

According to Eckert, rates have always been set with the idea that reliability and resilience are vital, as well as the replacement of aging infrastructure.

"However, the Indiana General Assembly has set parameters demonstrating it did not intend for regulated utilities to receive blank checks," he stated.

This article originally appeared on Evansville Courier & Press: CenterPoint calls some cost concerns 'extreme scenarios'