If it specifically says in the lease that utilities are covered, he can't "legally" turn them off. Meaning your grandfather would win a court case. However, like the Utility Company said, they have to honor the request of the person who controls the account. They don't care what your lease says.
In short, the landlord is a douche. You'll win a court case, but that'll cost you more than getting the utilities hooked up plus a few months of service.
^^THIS
That being said, there is a "simpler" method to consider. If LL really shuts off the utilities, your family is still going to need light and warmth, right? I recommend pulling out the doors and drywall, and burning them in the pit out back, send the LL a pic of your lovely bonfire providing warmth and light for the neighborhood

**(obviously) Not to be construed as legal advice**