Joe Daniel, principal for carbon‑free electricity at RMI, told the Utility Consumers Board on Dec. 1 that household energy affordability means "the ability to pay your monthly electric and gas bill without foregoing basic necessities or risking your health and safety." He urged targeted programs for low‑income households rather than trying to cut overall system costs.

Daniel said energy burden — the percentage of household income spent on energy — is commonly regarded as affordable under 6 percent and catastrophically unaffordable above 20 percent. "Low income families in The United States pay, on average, 20% of their income towards [energy]," he said, and warned that the human impacts of disconnection can include loss of refrigeration for medicine and intervention by child protective services.

RMI’s approach frames three levers: reduce system costs where feasible, preserve customer agency and predictability, and use targeted cost allocation. Daniel said reducing overall system costs enough to solve low‑income energy burden would be unlikely — "we would have to reduce overall energy costs by 75%" — but a much smaller targeted transfer, on the order of 2 percent of system costs directed to low‑income customers, could have the same effect.

He outlined five policy tools the organization models: low‑income energy efficiency, low‑income discount rates, percentage‑of‑income payment plans (PIPs), disconnection protections and arrearage management plans. On arrearage management, Daniel warned about third‑party debt sales and legal collection actions, saying these steps can perpetuate the energy‑poverty cycle. "There is an idea that we should be preventing, outlawing, encouraging, or incentivizing the end of selling utility customer [debt]," he said.

On disconnections, Daniel reviewed national reporting and said Colorado has both cold‑ and heat‑based protections as well as some medical protections, but lacks carve‑outs other states have for seniors, people with disabilities, veterans and households with infants. He described low‑income energy efficiency as a high‑value intervention that is often undercounted in standard cost‑effectiveness tests and noted participation challenges for deep retrofits.

Daniel highlighted pilots where percentage‑of‑income payment plans cut arrearages and increased on‑time payments, citing a Michigan pilot that reduced arrearages by roughly 90 percent for participating customers. He also described RMI’s energy poverty policy simulator, which models LIHEAP and programs such as low‑income discounts, PIPs, energy efficiency, arrearage forgiveness and alternative funding mechanisms to show impacts on bills, burdens and who bears program costs.

In a question‑and‑answer session board members raised landlord‑tenant and prepay (prepayment) issues. Daniel said research on prepay programs has shown mixed outcomes: some prepaid designs can increase disconnections if customers underestimate usage or encounter reconnection fees, while other programs paired with arrears management can produce better outcomes.

Daniel urged combinations of policies and creative funding: settlement‑driven investor contributions, securitization, or performance‑based sharing where utilities bear some risk if costs exceed budgets. "Don't pull on any one lever all the way," he said, recommending starting with cost‑effective low‑income efficiency and layering targeted discounts and PIPs with broader cost controls.

The board thanked Daniel and asked staff to share his slides and the simulator outputs; staff said the slides would be posted to the drive for members.