Utility billing deferral initiative

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In response to the COVID-19 pandemic, the Alberta government is working with utility companies and service providers to allow certain qualifying and at-risk customers, who are unable to pay their bill when due, to defer their utility bills for up to 90 days. During this time, no eligible Albertans will be cut off from these services. This program came into effect on March 18, 2020, and will run through June 19, 2020.

As Alberta’s independent utilities regulator, the AUC is supporting the Department of Energy’s implementation of its initiative, primarily by assisting with the government’s ongoing information gathering. Comments, questions, and general information from affected parties are being collected through the Engage platform for use by both the government and the AUC. Those related to policy matters will be forwarded to the government, with responses posted as the government provides the requested information. While the government’s response is pending, the AUC will respond to comments pertaining to matters within its jurisdiction.

The AUC hosted a stakeholder teleconference on March 19, 2020, followed by a webinar on March 20, 2020. At the webinar, the government’s intention regarding the deferral program was clarified to industry stakeholders. The government recognized that one solution could not apply to all, so the AUC has established different working groups in an attempt to arrive at specific solutions for the successful implementation the program.

The AUC has created the ‘Utility billing deferral initiative’ project and started three discussions under the project labelled “Small retailer/REA/Gas Coop” (first meeting held Tuesday, March 24), “Large Retailer” (first meeting held Wednesday, March 25) and “Distribution Utility” (first meeting held Thursday, March 26). We invite comments and suggestions in an effort to reach a common solution for the implementation of 90-day deferral program. Please choose the discussion that best reflects your interests and submit your comments under that discussion. More information will be shared as it becomes available.

Please note, discussions #1, #2 and #3 are now closed. Detailed information on Utility Billing Deferral Program has been posted on the AUC website under COVID-19 impacts page.



In response to the COVID-19 pandemic, the Alberta government is working with utility companies and service providers to allow certain qualifying and at-risk customers, who are unable to pay their bill when due, to defer their utility bills for up to 90 days. During this time, no eligible Albertans will be cut off from these services. This program came into effect on March 18, 2020, and will run through June 19, 2020.

As Alberta’s independent utilities regulator, the AUC is supporting the Department of Energy’s implementation of its initiative, primarily by assisting with the government’s ongoing information gathering. Comments, questions, and general information from affected parties are being collected through the Engage platform for use by both the government and the AUC. Those related to policy matters will be forwarded to the government, with responses posted as the government provides the requested information. While the government’s response is pending, the AUC will respond to comments pertaining to matters within its jurisdiction.

The AUC hosted a stakeholder teleconference on March 19, 2020, followed by a webinar on March 20, 2020. At the webinar, the government’s intention regarding the deferral program was clarified to industry stakeholders. The government recognized that one solution could not apply to all, so the AUC has established different working groups in an attempt to arrive at specific solutions for the successful implementation the program.

The AUC has created the ‘Utility billing deferral initiative’ project and started three discussions under the project labelled “Small retailer/REA/Gas Coop” (first meeting held Tuesday, March 24), “Large Retailer” (first meeting held Wednesday, March 25) and “Distribution Utility” (first meeting held Thursday, March 26). We invite comments and suggestions in an effort to reach a common solution for the implementation of 90-day deferral program. Please choose the discussion that best reflects your interests and submit your comments under that discussion. More information will be shared as it becomes available.

Please note, discussions #1, #2 and #3 are now closed. Detailed information on Utility Billing Deferral Program has been posted on the AUC website under COVID-19 impacts page.


  • All previous direction and documentation regarding the deferral have indicated that the backstop covers balances with due dates between March 18 and June 18, and anything due from June 19 onward will not be eligible for funding.  The direction provided on the call yesterday differed from this by stating that any customer is still able to request deferral of outstanding bills any time up to June 18, regardless of their due dates.  As bills produced as early as June 2nd have actual due dates after June 18th, it is our understanding that the charges presented to customers on them cannot be included in our filing.  Please confirm, as this appears to be a disconnect between what we are able to have backstopped and what you expect us to give customers a year to repay.

 Customers can request deferral of bills that have dues dates between March 18, 2020 and June 18, 2020. This is not changed. If a customer has a bill with a due date of June 17, 2020, he can request a deferral of that bill up until the next day. An invoice with a due date after June 18, 2020 is not eligible for deferral and consequently not to be included in a funding application.


  • The expectation of deferral customers is that every month they will pay their new charges in full along with an agreed-upon repayment installment.  In the event they do not make this expected payment in full, what is the expectation of a retailer in terms of applying the partial payment against the deferred balance versus the post-deferral balance.  For example, if a customer had a $50 repayment installment and $100 in new charges, but only made a $75 payment, how much of that $75 must be used to repay the deferral backstop versus paying off the new charges?

The first decision point for the retailer was to determine if this partial payment would be acceptable. If the determination was it was not acceptable, then the retailer should notify the customer that the repayment arrangement was broken and the retailer’s normal collection activities would ensue.

If the retailer was satisfied with the partial payment, then the retailer should enquire with the customer if a different repayment arrangement was require. The information provided by a number of retailers about the logic used their billing systems is that the first allocation of payments goes towards satisfying the GST requirements. The payment is next applied to the oldest arrears. In your example, I’m assuming the customer does not have an amount outstanding prior to March 18, 2020. Consequently, if the outstanding amount is $150, then the amount of the oldest arrears is $50. The billing logic would therefore suggest this should be paid first and the remaining $25 applied to the current charges.

Another reasonable approach would be to allocate the payment in the same ratio as the billing charges. In your example, the deferred portion makes up 1/3 or the total bill so 1/3 of the payment goes towards the deferred amount and the remainder to the current charges. In both these cases, an amount would be repaid towards the funding received which would satisfy the Balancing Pool’s and the government’s expectations of receiving regular payments. We would appreciate understanding how the billing logic and systems worked for the retailers so we could understand how the payments would be treated. The act provides the AUC with the power to direct how the payments are to be allocated and it would be preferable if we did not have to use that power


  • For amounts that were in arrears prior to the commencement of the deferral period, can we resume collections on these amounts post June 18?

 Yes

 If not, what about amounts that were already in collections prior to the deferral period?

  Yes. After June 18, 2020, your normal collection activities can resume.


  • Can we charge a late payment fee if a customer is late in making their monthly repayment of the deferral amount?

  Yes, but only on the portion of the deferral amount that is in arrears. For example, the total deferred amount was $300 and you were collecting it in $25 monthly installments. Customer did not pay the bill that included the $25. You would be able to charge the late payment fee on the $25, not the entire $300.


  • A comment was made during industry meeting regarding penalties, and you advised that penalties can only be applied to a deferral balance that has not had a payment arrangement fulfilled on. Eg. Customer made arrangements to pay $25 per month, and does not make the agreed upon $25 payment. You advised that penalties could only be applied to the $25, and not the total outstanding deferred balance.
     Our understanding, as previously discussed, is that the act does not specify penalties during the repayment period, and that normal practices, including penalties on all outstanding amount would resume after June 18, 2020. Please advise if this is correc
    t.  

You are correct that the act is silent about late payment penalties during the repayment period.

It is our understanding that if you made arrangements with the customer to have an amount outstanding prior to March 18, 2020 repaid over a specified term, then no late payment fee should be applied to the balance that you agreed to have deferred. Eg., if a customer had owed $200 prior to March 18, 2020, then asked for a deferral of an additional $300, then by June 18, 2020 the arrears would total $500. If you agreed with the customer to a 12-month repayment plan for the repayment of this total amount, then if they missed the payment on the first invoice, you should be able to charge a late payment penalty on the amount of this bill only, because you agreed to a 12-month repayment plan for the entire amount.

If you decided on the full repayment of the prior balance, and established a repayment schedule for the deferred amount which came to $25 per month. In this situation the customer’s bill after June 18, 2020 would have a previous amount outstanding ($200), a current charge (assume $100) and a deferred payment portion of $25. Total bill due would be $325. If the customer missed the payment, you should be able to charge late payment penalty on the total invoice due which is $325.


  • If a customer does not pay their bill during the repayment period (meaning their agreed-upon repayment installment goes unpaid) and a late-payment penalty is then assessed against their repayment installment amount on their next statement, which the customer then pays, is the revenue from that late-payment penalty required to be submitted to the backstoppers (i.e. does the Balancing Pool get the benefit of these penalties)?  Further to this, is there an expectation that such penalties will be charged in this situation, or is this at our discretion?

 This is a very good question. Assuming the customer’s bill was $150, made up of $50 deferred and $100 current charges. He did not pay at all, but then paid in full afterwards. Reasonableness test would suggest the late payment penalty collected would be split between yourselves (2/3) and the Balancing Pool (1/3). We will provide a follow-up response and would be interested in your comments.


  •  During the repayment period, if a customer makes a payment and we include a portion of it our repayment of backstopped amounts, then that customer’s payment is subsequently cancelled by their financial institution (NSF, credit card chargeback, etc.), are we able to reduce our next repayment by that reversed amount to reflect reality?

 Yes, and you should be explaining that experience as part of the monthly reporting.


  • A comment was made regarding enrollment for the deferral, and you advised that if a customer did not call in to enroll in the program, as a retailer, you should automatically enroll these individuals for the deferral. 

Our understanding is that customers have until June 18, 2020 to enroll in this program, and after this date, they can no longer be enrolled. It is our understanding that it is not the responsibility of the retailer to enroll the customer. Please advise if this is correct. 

You are correct that the act does not specifically state that if a customer does not initiate contact with the retailer to be enrolled in the program, that the retailer will automatically enroll the customer. 

When Bill 14 was being debated on May 8, 2020, the Minister made a statement regarding the intent of the program. You can find his statement at the top of page 788 of the Hansard document. 


  • A comment was made regarding retailers that are not requesting a loan from the balancing pool and that they are still required to report on a monthly basis, and provide a copy of their processes.

Our understanding through the act is that under section 10 “Duty to keep accounts and records”, is that retailers that received funding from the Balancing Pool would be required to report, and not those who are self funding their deferred accounts Please advise if this is correct. 

You are correct that retailers who requested funding will be required to report as set out in the act. Retailers who are self-funding do not need to report as it relates to the funding reporting. 

Retailers who are self-funding will be required to report if they intend to seek recovery of incremental bad debts as a result of the program or of any other costs that the government deems eligible for recovery through a rate rider mechanism. We are awaiting further information from the department of energy regarding this. 

The Alberta Utilities Commission is required to provide the government with a financial report by the end of each year regarding the program. We interpret this reporting responsibility to include the activities of retailers who are self-funding. Consequently, there will be information requested of retailers who are self-funding so that our report could be comprehensive and accurate.


  • Please provide how we are to determine the classifications of the sites i.e., residential, small commercial and farm. For example, when is a farm a farm and when is it a commercial operation? Do we use the distributor’s tariff to determine that or do we use the settlement profiling class?

Please use whatever classification approach is easier for you. Applicants should mention the approach in their cover letter and follow this approach the rest of the program (e.g., Funding application and repayment reporting). If it is not apparent how the site should be categorized, there should be an “All other classes” category that you could use to record the site. The request for this breakdown is to help with the reasonableness check we do when we review the funding applications


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