In a bid to provide some relief to the financially crunched state residents amid the COVID-19 pandemic, the Michigan Department of Health and Human Services (MDHHS) is making energy bill payments directly to the utility accounts of consumers. This will not only help the energy consumers financially but also allow them to keep services, which otherwise would get disconnected by the end of June 2020, says GlobalData, a leading data and analytics company.

The primary goal of the direct payment pilot is to ease access to energy assistance statewide through State Emergency Relief (SER).

Utilities, such as Consumers Energy, DTE, and SEMCO had previously allowed moratoriums on payments against supply in response to the pandemic and its impact on utility customers. The moratorium is scheduled to end on 12 June 2020.

In addition, the utility providers have in turn agreed to waive off 25%, or a total of approximately US$2.3m of the outstanding bill for households receiving the direct payment. This is likely to allow MDHHS’ COVID-19-related Low-Income Home Energy Assistance Program (LIHEAP) to assist more families.

Somik Das, Senior Power Analyst at GlobalData, comments: “Utilities across the globe are undergoing severe financial stress as they are supplying electricity to customers even in case of non-payments. The assistance from MDHSS would ease the worries for the three electricity utilities in the state of Michigan. The funding is likely to help households with their energy bills as Michigan begins to recover and reopen safely.”

This direct payment pilot program builds on the work MDHHS has already done to streamline its primary program, the SER, for energy assistance to eligible families across the state. In the wake of the COVID-19, MDHHS made certain policy changes to SER, where they increased the maximum amount, that families can receive in energy assistance.

Das concludes: “Additionally, it removed interview requirements for availing assistance, simplifying and raising asset limits, eliminating one-time limits on aid, and eliminating co-payment requirements. All these assistance from MDHHS is likely to allow faster processing of emergency requests and make access to benefits easier to Michigan’s households.”