Consumer Rights & Responsibilities, Protections

1. Consumer Rights & Responsibilities, Protections Energy Regulatory Partnership Program Abuja, Nigeria July 14-18, 2008 Robert W. Kehres Director, Regulatory Affairs Division Michigan Public Service Commission

2. Consumer Rights Responsibilities and Protections • MPSC developed the Consumer Standards and Billing Practices for Electrical and Gas Residential Services Rules • Purpose of rules: • Provide protection from utility practices harmful to residential customers • Determine utility company and customer rights and responsibilities

3. Customer Rights • Residential gas and electric customers have the right to have: • Safe and reliable service • Fair and equitable treatment • Utility meters read accurately monthly • Accurate bills by mail or electronically (if company can provide) • Prompt and courteous handling of questions and /or problems • Protection from unfair security deposits or guarantee terms and conditions

4. Customer Rights (Continued) • Customers also have the right to energy assistance programs: • Budget Billing Plans • Winter Protection Program • Home Heating Credit • Earned Income Credit • State Emergency Relief Program • Medical Emergency • Protection for Active Military Duty • Weatherization Assistance

5. Budget Billing Plans CONTACT: Local utility company Offered by utilities (required by the MPSC) Assists customers with household budgets Allows customers to pay their estimated annual bill in equal monthly payments Review is done at the end of 11/12 months and monthly payment amount may be adjusted up or down Customer Protections

6. Customer Protections (Continued) Heating Assistance Programs Winter Protection Plan (WPP) CONTACT: Local utility company • Required by state law and MPSC rules • Low income and senior citizens will not be shut off during heating season if they meet the requirements • Heating season is November 1 – March 31 • Pay all amounts not paid during heating season in summer months

7. Customer Protections (Continued) Winter Protection Plan (WPP)Benefits Low Income Customers CONTACT: Local utility company • Income at 150% of Federal Poverty Level • Pay 7% of estimated annual bill each month November 1 – March 31 • Pay 1/12 of past due bills at enrollment November 1- March 31 • Shutoff protection for natural gas and electric service • Can be used to restore or initiate participation in the program. Pay 1/12 of past due bill but no deposit or reconnect fee

8. Winter Protection Plan (WPP) Income Guidelines 2007-2008 Household Members Maximum Income 1 $15,315 2 $20,535 3 $25,755 4 $30,975 5 $36,195 6 $41,415 7 $46,635 8 $51,855 Add $5,220 for each additional household member

9. Winter Protection Program (WPP) for Seniors CONTACT: Local utility company • Notify company if 65 or older • Enroll between November 1 and March 31 • No specific payment amounts required • Encouraged to pay what they can. • Must repay amounts owing at end of shut off protection period • Payments can be spread from April to beginning of next heating season (November 1)

10. Customer Protections (Continued) Home Heating Credit (HHC) CONTACT: Michigan Department of Treasury or Local utility company • Administered by MI Department of Treasury • Income guidelines (extra exemption for seniors and disabled persons) • Customer must complete form to get credit but not required to file income tax form • Local agencies and sometimes utilities will help complete form • Shut off protection provided while form being processed by Treasury

11. Customer Protections (Continued) Home Heating Credit Income Guidelines Household Exemptions Income Ceiling 1 $11,243 2 $15,072 3 $18,900 4 $22,729 5 $26,558 6 $30,386 For each exemption over 6 add $3,829

12. Customer Protections (Continued) Earned Income Credit (EIC) CONTACT: Internal Revenue Service (IRS) • Administered by IRS • Federal income tax credit for low-income working individuals and families • Do not have to owe income tax to qualify but you must file federal income tax return • If raising qualifying child in home, may be able to get part of credit in your paycheck during the year with Advance EIC

13. Customer Protections (Continued) Crisis Assistance Program (State Emergency Relief) CONTACT: Michigan Department of Human Services (MDHS) • Do not have to be an MDHS client • Must meet income guidelines but do not have to be DHS client • Year round help available • Assists households with heat or electric shutoff notice or who need deliverable fuel

14. Customer Protections (Continued) Medical Emergency Protection CONTACT: Local utility company • Required by MPSC rule • Protected from shutoff of electric or natural gas up to 21 days • Must have doctor or public health official statement re: nature of emergency and time shutoff will aggravate emergency • Shutoff may be extended up to 63 days with additional certificates • Annually extensions may be up to 126 days per household • If shutoff without postponement utility shall unconditionally restore service for not more than 21 days not to exceed 63 days for a household member

15. Customer Protections (Continued) Customers on Active Military Duty • Required by state law and MPSC rules. • Customer or spouse of customer called to full-time active duty may request shutoff protection up to 90 days with extensions. • Required to repay entire amount billed within 12 months.

16. Customer Protections (Continued) Weatherization Program Contact: Local Community Action Agency • Federally funded, free conservation services to low-income • Helps reduce energy use and lowers utility bills • DHS clients and individuals at 150% of Federal Poverty Level eligible • May include: • Caulking and weatherstripping • Wall, basement and attic insulation

17. Demand Response Energy Regulatory Partnership Program Abuja, Nigeria July 14-18, 2008 Ikechukwu N. Nwabueze, Ph.D. Director, Regulated Energy Division Michigan Public Service Commission

18. The reduction of customer energy usage at times of peak usage in order to help address system reliability, reflect market conditions and pricing, and support infrastructure optimization or deferral. Programs may include dynamic pricing/tariffs, price-responsive demand bidding, contractually obligated and voluntary curtailment and direct load control/cycling. Definition of Demand Response

19. General concept for the process of transforming the nation’s electric power grid into an intelligent network by applying computers, electronics, and advanced materials to implement advanced communications, automated controls and other forms of information technology to improve the economics, reliability and safety of the grid. Smart Power Grid

21. Enhancements to transmission-level developments, which improve grid stability Enable demand response programs at a customer level Michigan utilities are investigating AMI as a platform to implement demand response programs and other Smart Grid initiatives Advanced Metering Infrastructure (AMI)

22. No Major Utility in the USA Has Yet Deployed Full AMI • Full AMI includes an in-home wireless network allowing real-time two-way communication between the utility and customers. • Enabling technology consists of the following: • Internet accessed consumption and price data • Programmable communicating thermostat • Intelligent appliances • In home monitor • Pre-paid services

23. AMI/Dynamic Pricing Creates a Workable Path to the Smart Home … Through Enabling Technologies

25. Utility of the Future Energy Management Services > Residential, Commercial Home area network gateway > PLC (i.e. LONWORKS) > RF (Bluetooth) Web-based applications > Demand response > Prepayment > Load control > Revenue protection > Web move in/out Distribution > Load profiling/engineering > Phase balancing > Transformer optimization > Energy forecasting > Outage and GIS > Work force management > Asset management Smart Meters > Solid-state platform Integrated communications > Integrated disconnect switch > Remotely disconnect > Remotely connect Power quality data > Voltage readings > Current readings > Power Factor > Frequency > Detailed power outage data > Remote programmable > Remotely upgradeable > Internal expansion port > Future functionality Advanced Metering Infrastructure (AMI) > On-demand reads > Programmable load intervals > Bi-directional and net metering > Time of Use, Real Time Pricing, Critical Peak Pricing options > Demand response Automatic Meter Reading (AMR) > One-way or two-way > Monthly kWh reads > Interval data > Basic theft detection > Outage/Restoration Detection Manual meter reading Monthly kWh reads

26. Pilot Programs/Research • Inexperience combining utility AMI technologies with innovative dynamic pricing structure. • Voluntary experimentation through the use of pilot programs prior to widespread adoption.

27. Pilots are scheduled to commence in 2008 Commission guidance is needed to establish: Minimum functionality criteria and standards necessary for the rate recovery of this infrastructure development Flexibility is critical to allow efficient smart grid infrastructure development for AMI and other smart grid developments AMI Pilots and Standards

28. Commission invited comments on preliminary questions (Commission Own Motion in Case No. U-15620): How should costs & benefits to utilities and customers be considered? To what extend should advanced-metering technologies and functions be standardized and utilities be able to select functions on behalf of customers? Investigation of Minimum AMI Functionality Standards

29. Should functionality standards and criteria on AMI deployment approaches, technologies and functions be prescribed? To what extent should standard protocols produced by advanced meter output be prescribed? Should the Commission establish minimum functionality for the recovery of AMI investment by utilities? Has open architecture been successfully implemented elsewhere? If guidelines are prescribed, what should they say? Investigation of Minimum AMI Functionality Standards (Continued)

30. Investigation of Minimum AMI Functionality Standards (Continued) • Should guidelines to deal with information transmission and storage issues be prescribed? • Should it require a pilot project or gradual deployment of advanced meters, in recognition of the volume of information that the market participants will have available from advanced meters?

31. AMI Case • Commission’s Own Motion, Case No. U-15620 • Investigate development of minimum functionality standards and criteria for advanced metering infrastructure • Public comments due August 1, 2008 • Staff shall summarize findings and file a report to the Commission by August 29, 2008

32. Questions?