Apr 10 - Milwaukee Journal Sentinel

A rise in energy costs, combined with a brutal winter, has led to a jump of nearly 12% in the number of residents falling behind on paying their utility bills, leaving Wisconsin's largest utility with millions in unpaid debt that could be passed on to paying customers.

Tuesday will mark the end of the state-mandated moratorium on heat shutoffs that began on Nov. 1. So far, We Energies has about 60,000 disconnections scheduled -- that's about the same as last year.

But the amount of money owed by customers has skyrocketed, with an increase of about $12 million in unpaid electricity and natural gas bills that are 61 days past due, the utility said Wednesday. The total uncollected debt as of this February was $114.8 million, compared with $102.9 million in unpaid customer bills in February 2007.

The utility company has raised its residential rate 5% since mid- January.

A portion of that increase incorporated bad debt, which included arrears that had turned into non-collectible money, utility officials said.

The record-high delinquency rate has utility officials redoubling their efforts to reach delinquent customers.

"We are making all types of attempts to contact customers and reach out to them," said Irissol Arce, a utility spokeswoman.

More than 160,000 calls have been placed, and thousands of disconnection notices have also been mailed to customers that are in arrears of $1,300 and 91 days past due, the threshold used for disconnection.

The company has made 8,000 payment arrangements so far, but the majority of delinquent customers haven't been in contact with the utility.

"Unfortunately, there are people who abuse the moratorium period," Arce said.

Shelter worried

There are others, however, like Louise Hunter, who runs a homeless shelter in Racine and owes more than $50,000 to We Energies, but has continuously made payments.

But she said she has had an increase in the number of people seeking services and doesn't have enough money coming in to keep up with the rising energy costs.

The shelter, Love & Charity Mission, 1031 Douglas Ave., is scheduled to be disconnected unless the agency can come up with $8,000 of the $52,505.90 that has accrued over several years, said Hunter.

She said she has been given an extension to pay the remainder.

"The gas company has really been good to us. I understand that now they want their money. We are calling people who have supported us in the past and asking for help," said Hunter, who is widely known as "Mother Hunter."

"Every day, people come into this shelter, getting food, clothes and furniture, appliances. Even if they have jobs, they still have to come here to get food," she said.

Hunter said that if the gas and electricity are turned off in the 8,000-square-foot, two-story building, it will mark the death knell for the 50-year-old agency.

Although Love & Charity is a commercial customer, the agency has a residential component, which qualifies it for the moratorium, utility officials said.

The economic downturn and rising prices for gasoline and food, coupled with the housing crisis could be partly to blame for the delinquencies as well, said a local economic analyst.

Related to economy?

Although a rise in delinquent utility customers isn't one of the traditional economic indicators, such as unemployment, it could be a "confirmational" indicator.

"This particular downturn has generated indicators that aren't necessarily ones that are previously quoted," said Bret Mayborne, the economic research director for the Metropolitan Milwaukee Association of Commerce.

"As an indicator, it sounds similar to the foreclosure indicator. It may be confirming the weaknesses that come through in other indicators," he said. "Some households may be struggling to keep up with the current economic downturn."

60,000

Number of disconnections scheduled

8,000

Payment arrangements made so far

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