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Public Service Commission Funds – Utility Mergers

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Description

The merger of utility companies can provide a unique opportunity to increase funding for low income energy efficiency program services while also capitalizing on those negotiations to increase health and safety investments in the utilities service areas in the state. Public Service Commissions (PSC) across the country have been increasingly open to considering the research on the non-energy benefits of energy efficiency interventions including improved health outcomes. PSCs have allowed increases in health and safety allowances where PSC program oversight exists and have also approved utility merger funds to be used for higher level health and safety costs including lead hazard reduction.

Strategic Implementation

Monitor any potential utility mergers and prepare your public health, energy, social and family stability benefits of increased energy efficiency and health and safety interventions in low income properties. Develop partnerships with local utility funded energy efficiency programs and submit a joint proposal to the PSC to use utility merger funds more flexibility to address health and safety issues that place the occupants at risk or would otherwise result in client’s deferrals (mold, lead hazards, roofing defect). If possible, develop an integrated housing assessment/energy audit and housing intervention model proposed for the funds that involves cross sector partnerships. Testify at the PSC public hearing in support of your proposal and the more flexible use of PSC utility merger funds. Utilize contacts with the Governor’s Office, state agencies, and other elected officials as appropriate to bolster support for increased energy efficiency program funding and increased health and safety budgets as part of the PSC’s allocation of utility merger funds

Example

The merger of energy power companies Constellation Energy and Exelon resulted in $103 million in utility merger funding being made available in Maryland. The Maryland Public Service Commission reviewed proposals and awarded $19.0 million for use by the Maryland Department of Housing and Community Development in seven counties and $19.8 million to the Baltimore City Department of Housing and Community Development for use on Consumer Investment Fund (CIF) low income, energy efficiency program interventions for weatherization, lead hazard reduction, health and safety and housing rehabilitation. The State of Maryland DHCD’s CIF Program is a strong example of how to seize opportunities for greater flexibility in the use of cross sector funding for lead inspections and lead hazard remediation. The Maryland DHCD CIF Program allowed $15,000 per unit in CIF funds to be expended with $6,700 for energy efficiency measures and the balance of funds allowable for lead hazard reduction, health and safety, and housing rehabilitation interventions as warranted by the energy audit and lead risk assessment. The maximum unit intervention cost was later increased by the CIF Program to $30,000 per unit for the highest risk cases that required more substantial interventions to complete.

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