SPOKANE, Wash. -

State regulators slapped Spokane-based Avista with a fine for improperly handling customer accounts including many low-income customers Thursday.

The Washington Utilities and Transportation Commission is penalizing the utility company for improperly applying energy assistance grants to past due bills.

"We have put up plastic on the windows. There is quite a lot of air that comes through these old windows," explains Diana Tann walking through her East Spokane home.

Conserving energy is a house rule, and that's why the 31-year-old Tann makes sure to keep lights off in vacant rooms, burn candles instead of lamps, and use blankets help keep her family warm.

"It [The power] actually was suppose to be shut off the beginning of this week, with my two kids in the weather that we have," says Tann.

Armed with a college degree, the single mom of two found herself unemployed and faced with mounting bills. Despite a new job, her rent and utility bills are past due and she's not getting a break.

"For three months they've been stacking and I've only been able to pay the bare minimum, everything carries over every month," says Tann, who is now facing eviction and has received a notice that her power will be shut off soon.

This family isn't alone. A growing number of families are struggling to pay their bills, and when it comes to their power, they are forced to turn to energy assistance programs.

The way Avista handles low-income customers like Tann has come under scrutiny, even though her case is different.

"Avista is currently applying all energy assistance grants to the past due amounts on the customers bill. That way we're able to work with customers to have them arrive to a zero balance on their account," says Avista Spokeswoman Debbie Simock.

That policy has come under scrutiny as the Washington Utilities and Transportation Commission has fined Avista more than $60,000 for improperly handling customer accounts and disconnecting service for non-payment. The Commission says energy assistance should help keep power on for customers in the winter time, not shut it off. Avista disagrees.

"We believe that we've been applying the funds appropriately, the rule is a little vague so we look forward to working with the commission to reach clarification on the application of the rule," says Simock.

Avista has 15 days to respond to the Commission's ruling and says it always tries to work with customers to pay past due bills.

As Christmas approaches, Tann's wish this holiday is that her boys will have a roof over their heads and warm place to sleep at night.

"I understand they have a business to run but at the same time, they also have to understand that this is a necessity not a want," says Tann.