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AABE Annual Conference
Energy Assistance
Presented by David L. Johnson, DirectorRevenue Management and Protection
May 19, 2010
2
Current Economic Challenges
Official unemployment rate for Detroit is 25.3%, but estimates on real unemployment approach 50%!
Source: Michigan Bureau of Labor and Statistics – March 2010
3
Current Economic Challenges
87,000106,000
118,000
45,730
0
40,000
80,000
120,000
160,000
2007 2008 2009 2010
Source: RealtyTrac.com – through March 2010
Michigan Foreclosure Filings
13.2% 13.5%14.0% 14.4% 14.4%
10.0%
12.0%
14.0%
16.0%
18.0%
2005 2006 2007 2008 2009
Michigan Detroit
Source: US Census Bureau
% People Below Poverty Level 33%
YTD
25456585
105125145165185205225
2006 2007 2008 2009 2010 Proj
LI Customers Identified State & Federal Funding Total LI Households in DTE Service Territory
As the number of Low-Income customers increases, State and Federal funding levels decline
DHS statistics show DTE may have as many as 450,000 Low-Income customers in its service territory
Current Economic Challenges
198K
236K
$73M
$88M $119M
255K
Allowing arrears to grow makes it very difficult for customers to restore service once disconnected
280K
$112M
356K*425K* 450K*
*Estimated based on DHS Statistics
PRIVILEGED AND CONFIDENTIAL
4
Mortgage
Car Payment
Credit Cards
Cable/Direct TV
5
Customer Payment Hierarchy
Cell Phones
Utilities!!
6
Evidence of Customers in Need is Apparent Everywhere
7
Customers in Need
• Eligible for energy assistance up to 200% FPL• Eligible for payment plans with special down-payment features• Low-income rates available• Most programs were designed to assist low-income customers
Low-Income in Arrears
• Not eligible for assistance• Payment plans available but without special rates• Energy efficiency programs available but at a cost
Non Low-Income in Arrears
• May or may not be in arrears• Sometimes pay late but always pay before disconnect notice is sent• Existing payment plans of little help • Primary concern is high rates and difficulty paying bills• Developing new programs to better assist this customer in reducing his/her bill
Slow Payers (Working Poor)
8
DTE Energy Community Assistance
State Government Partnerships
Non-Profit Assistance Agency Partnerships
Faith-Based Partnerships
Community Energy Forums
Customer Assistance Day
Community Organization Relationships
“Need Help?”
DTE Energy Assistance to Customers in
Need
• Partnering with four local churches to provide on-site low-income energy assistance via experienced DTE Case Management staff
• Increase to full staffing in CES Churches
• Expanded hours for greater customer convenience
• Add a church on the West Side of the state – Grand Rapids or Muskegon
• Expanding CES-like services into the Detroit Recovery Project
• Education and communications with Faith-Based and Community leaders
– Host an Energy Assistance Resource Conference– Implement a quarterly Energy Assistance Newsletter– Partner with leaders to streamline energy assistance messages thru
existing channels: church events, bulletins, etc.
9
Faith-Based and Community InitiativesCommunity Energy Solutions (CES)
Detroit
Second Ebenezer ChurchPastor Dr. Edgar Vann
Fellowship ChapelRev. Wendell Anthony III
New Galilee Baptist ChurchRev. Horace Sheffield
St. Cecilia’s Catholic ChurchFr. Theodore Parker
10
Customer Forums and Customer Assistance Day Event
• Holding 35 Customer Forums in 2010 vs. 14 in 2009
• Provide on-site assistance to low-income customers
• Assist customers filing HHCs and SER
• Customer Assistance Day 2009 event provided over $500,000 in support to over 10,000 customers
• Assembled over 25 Community Agencies
• Hosting two Customer Assistance Day events in 2010
PRIVILEGED AND CONFIDENTIAL
11
ArrearsCollection Process
Posting Day5-10 Days Prior to
Disconnect
Disconnect Day
Legal – Notify appropriate entities of disconnect; coordinate last minute actions necessary
UW211/DHS – Provide on-site support to tenants
Corp Comm – Additional media support if needed
Regional Relations – Notify appropriate legislative entities
ECAC – Response Team
Southwest Solutions – Provide housing solutions
Corp. Comm. – Prepare media announcement
Legal – Insure proper noticing; inform City of posting
Notify of Pending Disconnect:• Legal• Corp Communications• Regional Relations• Customer Service• Agencies• Legal Aide• Southwest Solutions
Visual documentation of posting
Sept. 11, 2009
Move Tenants Out
• Apartment in Landlord name• Tenants pay utility as part of
rent• Tenants primarily seniors
and low-income
Mo
ve
Ten
an
ts O
ut
Apartment Disconnect Communication Plan
12
“Need Help?”
13
Looking Ahead…
For Internal DTE Energy Use Only
• Developing new incentive-based payment plans tied to energy reduction to help customers reduce their utility burden – especially Slow Payers
• Establishing a Case Management One-Stop-Shop to help low-income customers all the way through the energy assistance process
• Working with state agencies to streamline access to assistance funding for customers
• Modifying collection strategy based on more refined customer behavior segmentation
• Enhancing customer office facilities and processes to reduce customer wait times and improve their overall experience
• Partnered with social agencies to apply to participate in Low-Income Rate Pilot sponsored by the Michigan Public Service Commission
14
What More Can We Do?
For Internal DTE Energy Use Only
• While existing programs have proven successful, much more can be done to support the communities we serve
• We must be even more attentive to our customers’ needs during these difficult economic times
• We need to be more resourceful and innovative in developing new assistance programs
Energy Assistance Arrears
2008 YE $74M $503M
2009 YE $119M $436M
2010 Target $112M $389M