Oil vendors say payments don’t cover the cost of oil. State officials say US Congress should be footing the bill.
Oil vendors are increasingly frustrated with the Connecticut Energy Assistance Program.
In fact, they say some are leaving the program altogether because reimbursements aren’t covering the cost of oil.
“We contemplate being in the program or not being in the program and make that tough decision because we’re losing money,” Quinoco Energy Services General Manager Jim Hickey said.
But the Department of Social Services and some lawmakers argue the problem is the federal government not providing enough money.
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“Really, Washington needs to prioritize the program and to fund it appropriately,” Sen. Matt Lesser, (D-Middletown) said.
Energy companies claim the problem is long standing, but they thought the state found a solution this year.
A new state law says companies should be reimbursed for oil based on the price the day of the delivery, not on the day they purchase the oil. Oil prices can fluctuate greatly from day to day.
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The new law also sets reimbursement prices regionally, not solely on the prices at New Haven’s oil terminal.
Connecticut Energy Marketers Association President Chris Herb said that’s not happening, though.
“If DSS just made the changes, the law required we’d be much further along,” Herb said.
DSS is leading a task force to figure out how to implement parts of the law. It also insists it has enough vendors to serve households around the state.
The agency said the problem stems from its effort to stretch available money to aid as many people as possible.
“CEMA putting DSS in a position of having to choose between these two groups as they know that increases in vendor reimbursement comes directly at the expense of the benefits CT families get,” DSS spokesman Jalmar Del Dios said in a statement.
CEMA is funded by the federal Low Income Heating Energy Assistance Program.
Some states add funding of their own to supplement their LIHEAP grants, and Connecticut did that on an emergency basis last year.
Lesser said Congress has to increase the funding to prevent that situation, though.
“We just don’t have the financial resources that the federal government has, and that’s why it’s a federal program,” he said.
Hickey is still participating in CEAP but stopped taking new customers who rely on the benefits. He said vendors shouldn’t have to absorb the costs of the program, whatever the solution is.
“We're not looking to make money we’re just -- we’re just looking to not lose money anymore,” he said.
