Section 36. Residential service deposits

1.  On and after January first,
  nineteen hundred eighty-two,  no  utility  corporation  or  municipality
  shall  require  any  new  residential customer, other than a seasonal or
  short term customer, to post  a  security  deposit  as  a  condition  of
  receiving  utility  service.  In  addition,  no  utility  corporation or
  municipality shall after the first day of  September,  nineteen  hundred
  eighty-two,  or  such  earlier  date  as  the  commission may determine,
  require a current residential customer to post a security deposit  other
  than such a customer who is delinquent according to standards set by the
  commission.  Deposits  held  on  the  first  day  of September, nineteen
  hundred  eighty-two,  or  such  earlier  date  as  the  commission   may
  determine,  shall be returned to the customer immediately, but not later
  than the next bill for service; provided, however, that  this  provision
  shall  not  apply  to  deposits  of  delinquent  customers.  No  utility
  corporation or municipality shall require any known recipient of  public
  assistance,  supplemental  security  income benefits or additional state
  payments to post a security deposit as a condition of receiving service.
    2. Notwithstanding the provisions of subdivision one of this  section,
  the  commission,  after  investigation  and  hearing,  may authorize any
  utility  corporation  or  municipality  to  require  and  hold  security
  deposits  from  residential  customers  or applicants for service upon a
  finding that the collection and maintenance of  such  deposits  is  cost
  effective  to the utility as a whole without regard to cash flow and the
  availability of capital.
    3. In any case where customer deposits are authorized by this section,
  a  utility  corporation  or  municipality  may  require  a  customer  or
  applicant  for service to deposit a reasonable sum of money according to
  the estimated quantity of such services necessary to supply the customer
  or applicant for service for two months,  to  secure  payment  for  such
  services  actually  rendered, or for the rental of fixtures, instruments
  and facilities actually supplied. Every  such  utility  corporation  and
  municipality shall allow to every such customer or applicant for service
  interest  on the sum deposited at a rate per annum to be prescribed from
  time to time and at least annually by the commission in light of current
  economic conditions and current charges paid for moneys borrowed by such
  utility, taking into account the expenses incurred by  such  utility  in
  obtaining,  handling,  returning  or  crediting  the sum deposited. Such
  interest shall be paid upon the return of the deposit, provided however,
  that whenever such deposit has been held for a period of one  year,  the
  interest  shall  be credited to the customer or applicant for service on
  the first billing for utility service rendered after  the  end  of  such
  period.  If a customer or applicant for service is not delinquent in the
  payment of any billing during such one year period, the deposit shall be
  refunded promptly at the end thereof, without prejudice to the utility's
  or municipality's right to require a deposit thereafter in the event  of
  a  delinquency. All utility corporations and municipalities shall exempt
  from deposit requirements any customer or applicant for service  who  is
  sixty-two  years  of  age or older, unless the customer or applicant for
  service is  a  bad  credit  risk  according  to  standards  set  by  the
  commission.