Public Service Commission approves MG&E arrearage-management pilot with reporting and cost-deferral conditions

The Public Service Commission on May 1 approved Madison Gas and Electric’s pilot arrearage management program, directing the utility to work with commission staff on performance metrics, require additional outreach before removing customers from the program, and permit MG&E to defer incremental 2025 program costs with escrow accounting treatment until current or future rate proceedings.

Commissioner Nikkashrini Nieto, who led the discussion, said the program responds to prior commission direction in MG&E’s most recent rate case and noted, “AMPs are not a new concept in Wisconsin.” She told the commission MG&E’s proposal is the fifth AMP the commission has considered and that the utility borrowed proven elements from earlier programs.

The commission described the approved pilot, called “Back on Track,” as voluntary and limited to customers with arrears balances of $300 or more that are more than 60 days past due and who have received energy or utility bill assistance in the past calendar year; customers experiencing long-term or permanent medical emergencies are also eligible. MG&E plans proactive outreach through bill inserts, email and media advertising, and continued engagement with community-based organizations to encourage eligible customers to enroll.

Nieto recommended one modification to the utility’s data- and removal-related procedures: require MG&E to make an extra phone call to a customer before removing them from the program. “I would ask that they do that,” she said, calling the step “common sense” and not a tariff-sheet change. Commissioners reiterated that the pilot will be reviewed through reporting and in the next rate case cycle.

On reporting, the commission required MG&E to work with commission staff to develop performance metrics and annual reporting requirements, including but not limited to the items proposed by MG&E and commission staff, to allow comparison with other AMPs the commission has previously approved. Commissioners said the reporting will inform a reevaluation of program design in approximately two years or during the next rate-case review.

On costs, the commission approved deferral of incremental 2025 program costs and modified that approval to require escrow accounting treatment so program costs incurred for the pilot are tracked and available for consideration in the currently filed and future rate proceedings. Chairperson Strand and other commissioners said the modification is intended to align timing between pilot expenses and rate-case treatment.

Commissioners thanked intervenors and commenters who participated in the docket, including 350 Wisconsin, Blacks for Political and Social Action of Dane County, the Urban League of Greater Madison and the Citizens Utility Board, noting those groups’ filings and comments helped shape the discussion. Commissioners also discussed budget-billing interactions with AMPs and noted that budget billing is a customer right under the state customer bill of rights; MG&E is not proposing to offer budget billing in tandem with the AMP because of billing-system programming complexity.

Action: A motion to approve MG&E’s arrearage management program consistent with the commission’s discussion passed on a voice vote. The commission specified (1) an extra phone-call requirement before customer removal, (2) annual reporting developed with staff and (3) escrow-accounting treatment for deferred 2025 incremental costs until the current or future rate proceedings.

The commission closed the agenda item and moved on to other business.