A utility may require an applicant for residential service who is a present or former residential customer of that utility to reestablish credit under Regulation .02 of this chapter at the time of the application if one of the following exists: Customer owes an outstanding bill for a prior residential service; Customer's residential account had been terminated by the utility during the last 12 months of prior service because of nonpayment of bills; Customer failed to pay a bill when it became due on more than two occasions in the last 12 months of prior service; Customer's residential account is more than 2 months in arrears; or Conditions of service or the basis on which the customer's credit was originally established have materially changed. A residential customer who has established credit and is receiving service, but who fails to pay a bill by the expiration date of a termination of service notice, may be required by the utility to reestablish credit by depositing the amount prescribed in Regulation .04 of this chapter in addition to paying the outstanding bill and a reasonable reconnection charge, provided that any prior deposit paid by the customer has been refunded.