The Joint Legislative Audit and Review Committee reported to the House Finance Committee on Jan. 14 that Washington’s public-utility tax credit for home energy assistance reimburses utilities for up to 50% of assistance but likely does not increase the amount of assistance utilities provide to low-income customers.

Pete Van Moorsel, JLARC staff, summarized: "The legislative auditor concludes that utilities are providing more home energy assistance to low income families, but the tax credit likely does not influence the amount of energy assistance that is provided."

JLARC reported the annual credit is capped at $2.5 million and is allocated by the Department of Revenue among roughly 60 utilities proportionally to the federal LIHEAP dollars their customers receive. About 30 utilities claim the credit each year; larger utilities receive the majority of the allocation (seven utilities receive roughly $1.9 million, or 78% of the cap).

Between 2018 and 2023, utilities increased energy assistance from about $53.6 million to $76.1 million — a 42% increase — while the credit’s share of total assistance fell from 4.7% to 3.3%. JLARC told the committee that many utilities said the credit did not affect how much assistance they offered, and that statutory and regulatory changes have since required utilities to provide low-income assistance (for example, the Clean Energy Transformation Act and later requirements for investor-owned utilities).

Van Moorsel said the Department of Commerce recommended terminating the credit, arguing the preference is small, not widely used, and that a comprehensive statewide approach would better address low-income energy burden. JLARC recommended the Legislature clarify policy objectives and, if the objective is to increase assistance, to consult Commerce to identify changes that would better achieve that outcome.

Representative Rammell asked whether the analysis examined unmet need and how many eligible households are not receiving assistance; Van Moorsel said JLARC relied on the Department of Commerce’s Energy Assistance report for county-level measures of energy burden but could not match the tax credit directly to individual household outcomes.

JLARC paused for committee questions; no formal action was taken during the hearing.