July 20, 2021

From the CEO’s Desk Newsletter

Predicting and reducing disconnections

Predicting and reducing disconnections

The economic impacts of the COVID-19 pandemic have led to a big jump in the number of customers unable to pay their utility bills. EBCE is deploying a host of tactics to reduce the risk of falling behind and getting disconnected.

As the lockdown took effect, the state unemployment rate exploded from 4% in March 2020 to 16% only a month later. Households earning less than $30,000 per year saw unemployment rates jump from 12% to 30%.

Along with unemployment came the inability to pay utility bills. Between February and December 2020, the amount of “arrearages” -- money owed on past-due bills -- increased by 130%. As of September over 30,000 customers (PDF) were more than $2,000 behind in their utility bills, three times as many as the year before. In all, customers owed over $1 billion in overdue bills, much of it more than three months late. Most of the debt was owed by residential customers, but a significant part came from medium and large commercial customers.

Faced with this looming catastrophe, the CPUC extended a moratorium on disconnections due to non-payment of bills through September 30, 2021.


To help anticipate who might have trouble paying their bills, EBCE is using “machine learning” software to target assistance programs. These algorithms are fed data on customer disconnections and usage, and demographic data drawn from the US Census Bureau. The algorithm develops formulas that predict outcomes, then picks the formulas that best match the data. It can basically learn from its mistakes, hence the name machine learning.

The formulas are then applied to the current database of customers. The analysis improves the odds of finding customers at risk by a factor of two or three, says Taj Ait-Laoussine, EBCE’s chief analyst.

“It’s not perfect,” says Ait-Laoussine, “but it helps increase the accuracy of our outreach. “Rather than send an email to 500,000 people, we can send it to 100,000 and be more likely to find someone.”


Once a household is identified, EBCE reaches out to help. EBCE is working with our member cities and community partners to spread the word about programs that help customers pay their utility bills.

EBCE launched the Connected Communities pilot program in 2020 to learn how to design and implement solutions to utility debt and disconnections. The initiative involves partnering with customers and community-based organizations to find new approaches that complement efforts by the State and PG&E.

EBCE hired Environmental Justice Solutions (E/JS), a local consulting firm, to research customers’ experience with paying utility bills. Between November 2020 and March 2021, E/JS held nine focus groups in English, Spanish, Cantonese, and Vietnamese with 30 EBCE/PG&E customers experiencing financial difficulties, high arrearages, and utility disconnections.

“One key finding from the focus groups is that customers know that their bill is due; it’s not an issue of remembering, it’s affordability,” says Sam Weaver, the

Program Manager for Connected Communities. “Customers use a ‘rotating triage’ method of managing bills -- when money is tight, they take turns paying their rent, insurance, utilities, and other bills.”

A key focus of Connected Communities is to help customers know about and enroll in rate discount programs, like California Affordable Rates for Energy (CARE), Family Electric Rate Assistance (FERA), Medical Baseline (for customers with powered medical equipment), and the Relief for Energy Assistance through

Community Help Program (REACH). EBCE has 130,000 customers enrolled in CARE and 4,000 in FERA.

Between March and November of 2020, the CPUC counted (PDF) an 11% increase in statewide enrollments in CARE and a 32% jump in the smaller FERA program. Over 3.21 million customers of California’s three investor-owned utilities are now on the CARE program, receiving a 30-35% discount on their electric bill and a 20% discount on their natural gas bill, with a total budget of $1.5 billion last year. FERA offers an 18% electric bill discount for families with slightly higher incomes than CARE guidelines.

The E/JS focus groups found that awareness of the CARE program was fairly high, but other options were not well known. Customers cited the difficulty of the enrollment process as a barrier.


Customers can also lower their bills with energy efficiency programs run by BayREN and PG&E. BayREN did energy upgrades for 53,115 housing units in the Bay Area last year, giving out $55.4 million in incentives. In 2020, PG&E’s Energy Saving Assistance (ESA) program provided 86,466 Northern California homes with energy efficiency and health, comfort, and safety improvements, saving over 53,950-megawatt hours. EBCE customers can participate in PG&E programs because they continue to pay the Public Purpose Programs charge, which funds those programs.

Solar can also help. The Energy For All program from GRID Alternatives, based in Oakland, helps qualifying low-income households put solar on their home. With the Resilient Home program, EBCE works with Sunrun to pair solar with household battery systems. EBCE set a goal to put at least 20% of program installations in disadvantaged and low-income communities or to serve customers on financial assistance programs or with medical equipment.

EBCE is working on using “community” solar to help low-income households. Community solar projects are larger systems that earmark their power to subscribers elsewhere in the community. Using two “green tariff” or GT programs -- Disadvantaged Communities (DAC-GT) and Community Solar (CSGT) -- EBCE plans to credit the power to bills of low-income customers on CARE and FERA rates, resulting in an additional 20% bill discount.

The community solar concept. Source: GRID Alternatives

Unfortunately, the two programs are limited, with each CCA given a sliver of the total state allowance. EBCE got 7.3 MW in total, enough to serve about 2,150 customers.

“We plan to site them in EBCE service territory, in neighborhoods designated as Disadvantaged Communities,” says Weaver. EBCE expects to begin procurement of solar energy to support these programs in the fall of 2021.


If none of these programs are enough and the customer still falls behind, there are additional program options.

While unemployment has leveled off at around 8% statewide, a mountain of back debt lingers. To help, the CPUC rolled out a new Arrearage Management Plan (PDF) in April. Under the Plan, low-income customers who owe money on previously unpaid bills are able to get that debt forgiven if they pay their current utility bills for 12 months.

While the Plan is being implemented and promoted by PG&E, EBCE customers enrolled in CARE or FERA rate programs are eligible. Customers must owe at least $500 in arrearages, with some portion of that at least 90 days past due. The program allows up to $8,000 in total debt forgiveness per 12-month period.

For more information about programs available to help customers with bill payment assistance, please visit: ebce.org/customer-assistance/