N.Y. Comp. Codes R. & Regs. tit. 16, § 11.12 – Residential service deposits.

(a) For the purposes of this section, a new residential customer is an applicant. A seasonal customer is a person who applies for and receives utility service periodically each year, intermittently during the year, or at other irregular intervals. A short-term customer is a person who requires service for a specified period of time that does not exceed one year. A customer who receives continuous utility service for more than one year shall not be considered a seasonal or short-term customer.
(b) Unless authorized by the commission under subdivision (e) of this section, no utility shall require any new residential customer to post a security deposit as a condition of receiving utility service, unless such new customer is a seasonal or short-term customer.
1. (1) As of September 1, 1982, no distribution utility shall, unless authorized by the commission under subdivision (e) of this section, require a current residential customer, other than a delinquent customer, to post a security deposit, and deposits held on that day shall be returned promptly to nondelinquent residential customers, and in no event later than the next bill for service.
2. (2) As of June 18, 2003, no utility shall, unless authorized by the commission under subdivision (e) of this section, require a current residential customer, other than a delinquent customer, to post a security deposit. Deposits held from current, nondelinquent customers whose agreement for the provision of commodity was renewed on or continued on or after June 18, 2003 shall be returned promptly to such customers, and in no event later than the next bill for service.
(c)
(d) Notwithstanding the requirements of subdivision (c) of this section:
1. (1) a utility may continue to demand deposits as a condition of receiving utility service from customers who are seasonal customers or short-term customers as defined in subdivision (a) of this section; and
2. (2) a utility may require a deposit from a residential customer as a condition of service if that customer is delinquent in payment of his or her utility bills. A current customer is delinquent for the purpose of a deposit assessment if such customer: A utility intending to require a deposit under subparagraph (i) of this paragraph shall provide a customer written notice, at least 20 days before it may assess a deposit, that the failure to make timely payment will permit the utility to require a deposit from such customer.
  1. (i) accumulates two consecutive months of arrears without making reasonable payment, defined as one half of the total arrears, of such charges before the time that a late payment charge, as described in section 11.15 of this Part, would become applicable, or fails to make a reasonable payment on a bimonthly bill within 50 days after the bill is due, provided that the utility requests such deposit within two months of such failure to pay; or
  2. (ii) had utility service terminated, disconnected or suspended for nonpayment during the preceding six months.
3. (3) If a utility requires a deposit from a current residential customer who is delinquent by virtue of his or her failure to make a reasonable payment of arrears, as provided in paragraph (2) of this subdivision, it shall permit such customer to pay the deposit in installments over a period not to exceed 12 months.
4. (4) A utility may require deposits as a condition of receiving utility service from new residential customers who fail to provide reasonable proof of identity pursuant to section 11.3 of this Part, provided a hearing has been held pursuant to Public Service Law, section 36(2) and required findings have been made by the commission.
(e) Notwithstanding the requirements of subdivisions (b) and (c) of this section, a utility may demand and hold deposits from new or current residential customers as a condition of utility service if the commission after investigation and hearing so authorizes such practice, upon a finding that the collection and maintenance of such deposits is cost-effective for the utility as a whole without regard to the utility's cash flow and the availability of capital to the utility.
(f) No utility shall require any person it knows to be a recipient of public assistance, supplemental security income, or additional State payments, to post a security deposit.
(g) No utility shall demand or hold a deposit from any new or current residential customer it knows is 62 years of age or older unless such customer has had service terminated, disconnected or suspended by the utility for nonpayment of bills within the preceding six months.
(h) In any case where customer deposits are authorized by this section, a utility may require a new or current residential customer to deposit a reasonable amount of money not greater than twice the average monthly bill for a calendar year, except in the case of electric or gas space heating customers, where deposits may not exceed twice the estimated average monthly bill for the heating season, in order to secure payment for services actually rendered or for the rental of fixtures, instruments and facilities actually supplied. Every utility shall allow every customer from whom a deposit is required, interest on the amount deposited at a rate prescribed annually by the commission in light of the 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 to the customer upon the return of the deposit, or where the deposit has been held for a period of one year, the interest shall be credited to the customer on the first billing for utility service rendered after the end of such period. If any customer is not delinquent in the payment of bills, as defined in paragraph (d)(2) of this section, during the one-year period from the payment of the deposit, the deposit shall be refunded promptly without prejudice to the utility's right to require a future deposit in the event that the customer thereafter becomes delinquent.