Statewide Monthly Low-Income Energy Assistance Program Design Report.
The 2023 Enacted Operating Budget directed the Department of Commerce (Commerce) to recommend a design for a statewide energy assistance program to address energy burden and provide access to energy assistance for low-income households. Commerce's report was published in November 2024.
Commerce's recommended program design elements include:
Low-Income Energy Assistance Under the Clean Energy Transformation Act.
Electric Utility Requirement for Programs and Funding.
Under the Clean Energy Transformation Act (CETA), electric utilities must make programs and funding available for energy assistance to low-income households, and to the extent practicable, must give priority to low-income households that spend a higher portion of their annual household income on energy bills (energy burden).
Low-income household incomes are those that do not exceed the higher of 80 percent of area median income or 200 percent of federal poverty level, adjusted for household size.
The energy assistance need is the amount necessary to reach a 6 percent energy burden. Energy assistance includes, but is not limited to, weatherization, conservation and efficiency services, monetary assistance, and direct customer ownership in distributed energy resources or other strategies, if such strategies achieve a reduction in energy burden for the customer above other available conservation and demand-side measures.
Electric Utility Reporting.
Electric utilities must demonstrate progress with providing energy assistance, have and submit a biennial plan to improve the effectiveness of meeting energy assistance need, and must biennially submit to Commerce with an assessment of:
Electric utilities must also provide the following related information to Commerce:
Commerce Reporting.
Commerce must collect and aggregate data estimating the energy burden, energy assistance need, and reported energy assistance for each electric utility on a biennial basis and make this information public on its website. This published data must include:
Commerce must assess how to prioritize energy assistance to higher energy burden households and must submit a biennial report to the Legislature that:
Gas and Electric Company Low-Income Rate and Program Approval.
The Utilities and Transportation Commission (UTC) may approve discounted rates and other low-income assistance programs for low-income customers of gas companies and electric companies. The costs and lost revenues from these discounts must be recovered in rates to other customers. Such low-income discounts or grants must be provided in coordination with community-based organizations in the utility's service territory.
Gas and electrical companies must conduct substantial outreach to make low-income discounts and grants available and must report annually to the UTC on outreach activities and results
Low-Income Home Energy Assistance Program.
The Low-Income Home Energy Assistance Program (LIHEAP) uses federal grants to provide energy assistance to households that have an average monthly income at or below 150 percent of the federal poverty level. The LIHEAP provides assistance through a network of community action agencies and local partners, and it is primarily used to assist households with a one-time grant to the energy utility.
Climate Commitment Account.
The Climate Commitment Account (Account) is one of the accounts established by the Climate Commitment Act, and moneys in the Account may be spent only after appropriation. Projects, activities, and programs eligible for funding from the Account must be in the state of Washington and include, but are not limited to, 14 specified purposes.
Statewide Low-Income Energy Assistance Program.
The Statewide Low-Income Energy Assistance Program (Statewide Program) is established within Commerce to reduce energy burden for low-income households in the state, and Commerce may write rules to implement the program.
Commerce must begin providing energy assistance by July 1, 2026. Energy assistance only includes monetary assistance for the purpose of the program. Commerce must administer the program by providing energy assistance funds to gas and electric utilities. Gas and electric utilities must pass the funds on to their low-income residential customers and show the energy assistance on the customers' monthly bills. Commerce must provide a tiered amount of assistance to provide the most to the households with the greatest need.
Utilities with more than 25,000 customers in the state must provide energy assistance to customers and then seek reimbursement from Commerce, which Commerce must provide within 30 days of this request. Utilities with up to 25,000 customers may request that Commerce provide energy assistance funds before the utility provides the assistance to customers. Commerce may provide this upfront energy assistance with appropriate contractual agreements.
Commerce may enter into voluntary agreements with utilities to serve as coadministrators of the Statewide Program for the purposes of enhancing customer engagement, facilitating enrollment of eligible customers, and sharing administrative duties with Commerce.
Commerce must ensure that benefits provided through the Statewide Program are not less than what a customer enrolled in their utility program received in the previous year.
Utility Requirements for Participating and Opting-Out.
All gas and electric utilities must participate in the Statewide Program or opt-out under allowed circumstances.
A gas or electric utility may opt-out of the Statewide Program if the utility company provides monthly energy bill assistance to at least 50 percent of the low-income households it serves. Utilities must certify in an annual report to Commerce that the utility continues to meet this 50 percent requirement. The first of these reports is due by July 1, 2026. If a utility does not meet these requirements by July 1, 2028, the utility must contact Commerce to establish participation in the Statewide Program. Electric investor-owned utilities must additionally comply with the CETA low-income energy assistance requirements to opt-out.
A consumer-owned electric utility may opt-out of the Statewide Program if the utility complies with the CETA low-income energy assistance requirements.
Enrollment.
Commerce must establish enrollment details for the Statewide Program, which must include, but are not limited to the following requirements:
Outreach.
Commerce must provide outreach for the Statewide Program by:
Funding.
The Legislature intends for sustained funding to be provided from Climate Commitment Act auction revenues to meet low-income household needs. Commerce's obligation to provide energy assistance is based on available funding appropriated for this specific purpose. Implementing the Statewide Program is added as an eligible expenditure from moneys in the Climate Commitment Account.
Reporting.
Commerce must submit a report to the Governor and Legislature that includes a program evaluation of the Statewide Program by July 1 every even-numbered year.
Advisory Group.
Commerce must establish an advisory group for the Statewide Program before program implementation to help inform program development, program implementation, and the program evaluation. The advisory group must be a diverse group of stakeholders and must include members from low-income households.
Low-Income Energy Assistance Under CETA.
Electric utilities may meet the CETA low-income energy assistance requirements by participating in the Statewide Program.
As compared to the original bill, the substitute bill:
(In support) The energy assistance need across the state is not being met, and this incorporates Commerce's recommendations to get people the assistance they need. There is specific support for including the Climate Commitment Act (CCA) as a funding source, allowing broad eligibility criteria, prioritizing robust outreach, allowing utilities to continue their own programs if that is in the best interest of their customers, and for the CETA compliance provision. To ensure the future of the CCA, this program should be implemented because it provides visibility on the benefits of the CCA to many people on their monthly bills. Current law is not equitable; requiring every utility to carry out their own programs under CETA should be changed. The current patchwork of programs only meets a fraction of the need and is an inadequate system that keeps injustices in place. Assistance programs can help people break free from cycles of poverty. This would be a major stop to ensure security. Some of the critical protections put in place during the COVID-19 pandemic are no longer in place and more people are falling back and facing energy disconnections. Affordable and reliable access to energy is essential and critical for life. Public utility districts were engaged with Commerce during development of the proposed design for a statewide program. The bill would be improved if, for small utilities, Commerce directly funded the program. The bill should say that if adequate funding isn't provided by the state, any utility opting into the program must be still considered to be in compliance with the program. There is a concern about relying on appropriated funding to meet the need over time. There should be a more appropriate opt-out provision since investor-owned utilities have invested a lot in new utility bill discount programs. The July 1, 2026, deadline may be unrealistic because of the time needed for rulemaking, advisory group input, and for Commerce to establish and test the program. Access is a major barrier, particularly related to technology and language when programs are only in English.
(Opposed) None.
(Other) Key parts of this bill align with Commerce's report to recommend a design for a statewide program. There are a few ideas for how to work on the bill. This program is critical, but there are concerns about the long-term viability of funding because the CCA is designed to phase out over time. There needs to be a permanent and stable funding source.
(In support) Representative Sharlett Mena, prime sponsor; Daniel Fagerlie, Ferry PUD; Logan Bahr, Tacoma Public Utilities and Tacoma Power; Victor Fuentes, Franklin Public Utility District; Adán Espino Jr, Franklin Public Utility District; Nicolas Garcia, WPUDA; Jessica McCarthy, Okanogan PUD; Soumya Keefe, On behalf of NW Energy Coalition; Guillermo Rogel, Front and Centered; Cameron Steinback, Front and Centered; and Sahar Al Alarasi, Mother Africa.
As compared to the substitute bill from the Environment and Energy Committee, the second substitute bill:
(In support) This bill recognizes the critical need for establishment of a reliable monthly bill assistance program. More than 270 households are energy burdened. One-time efforts to provide assistance cannot fully address the outstanding need. It is recommend that a sustained monthly bill assistance program is created. This policy will cover a wider range of households. As the state transitions to clean energy, it needs to make sure affordability is included in the conversation. Most investor-owned utilities (IOU) have implemented energy assistance programs; the bill builds on this work, and ensures existing IOU programs continue. This follows the Commerce recommendations made in past reports. Phased-in is a more effective way than the current law which mandates a patchwork of assistance. It makes it easier and less stigmatized for low-income households to access energy assistance.
(Opposed) None.
(Other) While the effort is appreciated, the bill needs more work, including clarification of implementation processes. Targeting specific geographic areas inherently prioritizes certain low-income customers over others. Also, this policy conflicts with UTC authority over low-income programs. It requires IOUs to redesign their programs to fit Commerce's program. Social economic assessments go outside the scope of what utilities do and what information utilities have to access. The reimbursements language needs further clarification too, among other details that need clarification.
(In support) John Rothlin, Avista Corp; Dan Fagerlie, Ferry PUD #1; Guillermo Rogel, Front and Centered; Aqsa Mengal, Front and Centered; and Charlee Thompson, NW Energy Coalition.