KCP&L’s Budget Billing program explained
Changes in Kansas City Power & Light’s even-payment Budget Billing plan have triggered big monthly payment increases for 900 customers and could change others’ steady payments in the future.
A KCP&L spokeswoman said 900 customers using the Budget Billing program now have new monthly payments that are more than $100 larger than what they paid previously.
About 150,000 accounts have signed up for KCP&L’s Budget Billing program. The program charges a customer the same amount every month, expecting to collect his average yearly KCP&L bill. It helps consumers live on a budget by spreading out large summer cooling bills from an air conditioner or large winter heating bills from all-electric homes.
Changes in the program have ended the guarantee that a customer’s monthly payment won’t change over the next 12 months.
“How am I supposed to budget for that when they have the ability to increase or decrease every month if there’s a 10 percent difference in EACH month’s usage,” Kathy Shea of St. Joseph told the Missouri Public Service Commission in a public comment.
The Missouri PSC and Kansas Corporation Commission each approved the new program at KCP&L’s request.
Debra Yates of Kansas City told the PSC that the new plan is no longer budget billing and that calling it so is deceptive, according to the commission staff’s description of her comment.
Joe Robertson of Gladstone said that the monthly adjustments come at a bad time, summer, when many customers are likely to see their highest electric bills of the year, the staff’s description of his comment said.
Shea, Yates and Robertson could not be reached Tuesday.
More than 40,000 names have been added to an online petition that cites recent Budget Billing program changes. It calls for an audit of KCP&L. Comments posted on the petition web page include complaints about the changes.
“It does not make sense how the system calls it a budget billing system when they review statements every month and either increase or decrease based on usage. That is not a true budget billing system,” said the petition posted at change.org.
KCP&L said it changed its program because its old one often caught customers by surprise with a new higher payment like the one some are seeing now.
Previously, KCP&L would adjust each customer’s set monthly bill after 12 months on the program. Customers who used more than their payments had covered would see a higher new payment for the next 12 months.
In July, KCP&L adjusted all of its Budget Billing customers’ flat monthly payments rather than waiting for each one to reach that 12th month in the program. For 900 customers on the program, that increase was more than $100 a month.
High summer bills contributed to many seeing higher new payments, as this has been one of the hottest summers in the Kansas City area, KCP&L spokeswoman Katie McDonald said.
KCP&L said it adjusted all the Budget Billing payment levels so it could start its new program, which can adjust those payments in any month in which usage changes significantly.
Under the new program, KCP&L now will recalculate a customer’s monthly budget payment if the customer’s usage during the month varies by more than 10 percent from his average use. Higher usage would mean a higher bill that month and the following months to cover that additional use.
“If your new amount is 10 percent more or less than your existing amount, we’ll recalculate your Budget Billing amount for that month and the following months,” KCP&L said in its online description of the new system.
McDonald said such adjustments could start with customers’ August bills. These adjustments are intended to produce smaller adjustments during the year rather than large changes at the end of 12 months in the program that caught some customers by surprise.
The idea hasn’t sat well with all Budget Billing customers.
For all customers, KCP&L also changed its payment arrangements for customers who need help with a large bill. Traditionally, a customer who needed help would be asked to cover half of the large payment immediately and make up the rest a month later.
Under the new plan, the customer can spread a large balance over four monthly payments, McDonald said.
“We’re trying to be flexible in working with customers,” she said.