When Allied-Signal employee Al Robinson asked for help saving money on his electric power bills, Arizona Public Service Company officials signed him up for their special, after-hours yuppie rate." And they offered him a no-interest loan to buy a load controller, a device to help him follow the rules of the new rate by restricting his power use during daytime hours.
Now, two years later, Robinson is steaming mad because his electricity rate went up 17.5 percent in December, while most people, including his neighbors in northeast Phoenix, only got a 5 percent increase. When they triple my rate over everyone else's and I'm the guy who spent money on the front end to avoid this, I'm pissed," he says.
It's not surprising that Robinson isn't getting sympathy from APS. But state regulators at Arizona Corporation Commission aren't taking his side, either. In fact, not even the Residential Utility Consumer Office (RUCO), the state's consumer-oriented utility watchdog, is supporting Robinson.
Not only is he not getting sympathy, but one utility official contends that Robinson and others are whining."
It all started in 1989, when Robinson learned about the special combined-advantage" rate, for which he would be charged nearly 30 percent less if he used most of his power after 9 p.m. (Customers on the special rate would be penalized if they used large amounts of electricity during the daytime.)
Robinson thought the new rate sounded like a pretty good deal, so in August 1989 he had a $1,200 load controller installed outside his home.
The new rate benefited people who shut down their household during the day. That's why it was nicknamed the yuppie," or free-lunch," rate, says Gary Yaquinto, director of the utilities division at Arizona Corporation Commission.
Since he installed the load controller, Robinson estimates he's saved $300 on his electric bills.
However, last month, after the usual battle between APS and regulators, the Corporation Commission agreed to allow APS, the state's largest utility, to raise its rates. Most of the company's 522,000 residential customers received a 5 percent rate increase. But Robinson and about 10,000 other people on the Ôyuppie rate" got a 17.5 percent increase.
Stung by his higher bills, Robinson vows to circulate petitions to try to force reconsideration.
I've got a $1,200 doorknob hanging on the side of my house," he says. That silly thing hanging on my wall doesn't do one thing for my house. My one purpose was to control electric use. And I made that decision based on the numbers they gave me. That is just not right. You don't go and change the rules."
Keith Van Ausdal, supervisor of rate design and administration at APS, says the utility didn't change the rules; it just raised rates that had been experimental."
Robinson says he knew the plan was experimental and his rates might be increased, but he didn't know his rates would skyrocket.
Van Ausdal says customers like Robinson still will save money-even after last month's rate hike. While they used to save 27 percent compared to other customers, Van Ausdal says, now they'll save 12 percent.
The group that is whining, they aren't getting hurt," says Van Ausdal. I say they received excessive benefits. Now they're going to receive benefits more in line with the range of cost."
State regulators also appear unmoved by complaints from angry ratepayers like Robinson. It's not that we didn't understand their argument or appreciate it," says Renz Jennings, chairman of the Corporation Commission. When your job is to allocate misery, you don't make friends. Those people had a great, screaming deal. As it turned out, the rate was dramatically underpriced."
Ron Mathis, acting director of RUCO, says the utility's other residential customers appear to have been subsidizing those who paid the cheaper rate. It's probably true that the thing was underpriced," Mathis says. ÔRUCO has to respect all residential ratepayers. You can't give advantages to people who have load controllers."
And APS says the previous yuppie rate" wasn't to the utility's advantage, either. Van Ausdal says APS lost about $12 million because the rates charged were lower than it actually cost to supply power. Experimental rates may have errors," he says. You can call it a mistake. The fact is, when you have a voluntary rate, you don't know what people taking the rate will do."
What people did was tell their friends about it, Van Ausdal says. Word spread quickly: `Hey, you can't go wrong on this rate,'" he says. And if you can't go wrong on a rate, then we're sending the wrong cost signal."
The utility official says users of the yuppie rate" aren't being punished. Punishment would be: `Let's back-bill them for the difference,'" Van Ausdal says. I'm not proposing that by any means."
But Robinson says he wouldn't have purchased a load controller if APS hadn't convinced him it was a good deal. Once it was installed, he says, he changed his lifestyle to conserve energy by cutting down on the use of his air conditioner and clothes dryer. I'm being real conservative on my power use, and then they're raising my rates disproportionately," he says.
Of course, Robinson gets sympathy from at least one faction-the company that sold him the load controller. They worked with the rate the way the power company wants them to, and they get penalized," says Eric Fuller, sales manager of Advantaged Home Systems. The problem is, APS didn't realize that 99 percent of people who went on that rate knew how to work with it and did so diligently."
Now, of course, APS has even stopped promoting load controllers. As of January 1, the utility quit offering no-interest loans.
APS spokesman Wayne Kaplan says the utility now offers power meters for use with timers or thermostats. Those devices-simpler and cheaper than load controllers-can be purchased in home-improvement stores for $50 to $150, he says.
When APS raised the yuppie rate" last December 5, it decided to allow anyone to sign up for it. Even after the big increase, Kaplan says, people on the rate still can save an estimated 12 percent.
Jennings of the Corporation Commission doesn't concede that people who bought load controllers have suffered. After all, he notes, even if they did live in a hotter house or take longer to dry their clothes, they received power at bargain rates for three years.
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These people are just sensible," Jennings says, they're not heroes."
ÔThat silly thing hanging on my wall doesn't do one thing for my house."
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