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The Honolulu Advertiser
Posted on: Monday, January 12, 2009

As energy costs rise, needy could use a discount

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Make your opinion count in our daily online poll and see the results. Today we ask:

Should HECO ratepayers help cover the cost of providing needy families with a "lifeline" rate discount?

Vote today at www.honoluluadvertiser.com/opinion

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For the lower-income families of Hawai'i, the state's "Clean Energy Initiative" agreement, signed in October, will bring good news long before major changes are made to the Hawaiian Electric Co. power grid.

That's because part of the agreement is for the utility to produce a plan for a "lifeline" rate discount for these families. The plan will be presented by April to the state Public Utilities Commission. The goal should be to set up the benefit so that it reaches as many of the targeted needy families as possible.

It's a concept modeled after the Federal Communication Commission Lifeline Program, in which telephone companies pay a tax, passed on to rate payers, to finance a discount for needier families, based on the principle that those of limited means should not be denied access to a communications "lifeline."

Nationally, the lifeline idea is becoming a component of legislation that reduces the use of fossil fuels in the production of electricity. The rationale is that "clean energy" is going to cost more to produce, at least initially, and that families shouldn't be denied access to power because of inability to pay that cost.

In the case of the telephone program, lifeline service usage is somewhat limited, and similarly, a discounted rate for qualified electricity customers should not be a gold-plated subscription. HECO officials believe there should be some kind of cap to the usage under the discounted rate or there wouldn't be any incentive to conserve — and they're right.

But if there's a way to improve on the federal Lifeline concept, it should be in the level of outreach. The Center on Budget and Policy Priorities, a nonprofit research and analysis group in Washington, D.C., issued a study on that issue last July. According to the study, Hawai'i is one of seven states with an estimated telephone Lifeline program participation rate of under 10 percent of qualified families.

It may be that many families opt out because of limitations on the service. But HECO and the state need to ensure that the families that need the assistance at least have the opportunity to opt in.

The policy center proposes that clean-energy legislation create lifeline discounts that are linked somehow to other government subsidies, so that at least the utility has a database of qualified families to approach. The center proposes piggybacking the discount benefit on a program such as the Earned Income Tax Credit or the food-stamp benefit.

These should be considered, although there may be delivery systems better suited to the way programs for the needy are administered here.

The bottom line is that it's good to see the state and HECO cooperating on a plan that could help families manage a basic expense during a difficult economic period.

Now the utility and the commission, with the help of the state Consumer Advocate, need to make sure it reaches the families who need help.