PGW can no longer adjust customers’ May bills due to weather fluctuations

PGW customers will no longer see their May bills adjusted if it’s hotter or colder than usual.

The Pennsylvania Utility Commission last week unanimously approved an order that removed May from the list of months in which PGW can implement a weather normalization adjustment (WNA), which appears as a charge or a credit when temperatures are significantly different from historical averages.

The decision comes more than a year after some Philadelphians received May bills that were much higher than normal despite much of the month being unseasonably warm. At the time, The Inquirer reviewed about a dozen bills, finding that some residential customers with later-in-the-month billing cycles were hit with bills as high as $200. Some commercial customers reported bills as high as $500.

Under the latest order, weather normalization adjustments can still be applied to bills from October through April, but not in May.

The outcome worries Robert Ballenger, a Community Legal Services energy-unit attorney who represented Tenant Union Representative Network, which intervened in the case to ask that the bill adjustments be discontinued entirely.

“Accepting on its face what the commission found, historically May has been the month that has had the most unpredictable weather that results in unpredictable WNA charges,” Ballenger said. Given the impacts of climate change, history “is not necessarily a good predictor of what will happen this winter or next winter. So it’s hard to determine whether that is an adequate response and whether that is going to adequately protect customers going forward.”

Over the past two years, PGW has defended the WNA, which has helped the nonprofit, city-owned utility stabilize its finances for the past two decades and keeps customers bills from skyrocketing during frigid winter months.

The company did so again on Tuesday, disputing claims that lower-income customers are most affected.

“Low-income customers enrolled in our bill payment program are not impacted by the weather normalization adjustment; and for all other customers, WNA stabilizes their billing and protects them from significant billing fluctuations,” PGW spokesperson Richard Barnes said in a statement.

After the May 2022 incident, PGW ended up refunding $12.4 million to most of its 520,000 customers who were affected by abnormally high weather normalization charges.

In asking PUC to approve those refunds, PGW said a “significant anomaly” happened that “produced unusually large and unanticipated charges.”

PGW then requested the PUC allow it to cap the charge at 25% of a customer’s monthly delivery charges. The PUC did not allow that, instead voting unanimously for a full investigation of PGW’s proposed changes.

Weather normalization adjustments are calculated according to a complex formula laid out in the PGW’s tariff. Results are unique to each customer, and are dependent in part on expected heating usage and weather fluctuations compared to the same period in prior years.

Weather normalization adjustments are applied to most PGW customers, including those on budget plans. About 54,000 low-income families who are on assistance plans are not affected. Neither are non-heating customers.