Remember, little ratepayer and property owner, you're a PJM "stakeholder," too, and you should be participating in the planning process that at some point in the future may require you to sacrifice a right of way through your private property, or pay for big, new transmission lines of questionable benefit to you.
It's another hot time at the expensive, luxury hotel for our "stakeholders," where market power players and their toadies will be turning out in their best "resort casual" wear to partake in free leisure activities sponsored by the corporations that make big profits from the cartel.
You are cordially invited to attend the 2014 PJM Annual Meeting of Members to be held at the Hyatt Regency Chesapeake Bay. Please note that the dress code is “Resort Casual”. The program will be similar to last year's event starting on Tuesday, May 13 with registration and an Opening Reception and ending on Thursday, May 15 with the Members Committee meeting and buffet luncheon.
On Wednesday, May 14 we will have the General Session followed by lunch and leisure activities. Thanks to the generosity of our sponsors, each attendee may select one leisure activity at no cost to themselves. The following leisure activity selections will be available for choosing onsite at the registration desk and will be filled on a first-come, first-serve basis.
Golf
Spa
St. Michael’s Winery/Tour
Fishing
Biking
Kayaking They forgot to add extracting obscene profits from consumer pockets, but maybe that's not a leisure activity; instead it's one that requires hard work.
So, what do the PJM aristocracy do at these meetings, when they're not participating in leisure activities, receptions and luncheons?
They review the past year of incumbent electricity conglomerate rule. They "train" your Consumer Advocates. They eat dinner and hand out golf awards. Then they have entertainment night with desserts.* I think it would be pretty entertaining to give a couple of sponsor CEOs a pie in the face, but that's probably not what PJM has in mind. They also allow the well-funded environmental elite to perform a song and dance for the assembled dignitaries, but no one really pays any attention to it, although that never stops the "public interest group" PIGs from believing that this year's production will be the one that convinces everyone to pay even more for "clean" electricity.
So much glib self-congratulation at your expense, so little time. If your electric supplier is one of PJM's meeting sponsors, run (don't walk!) to sign up for one of the free leisure activities. You're probably paying for it in your electric bill anyhow, might as well enjoy.
And what are the worker bees doing at PJM while the lords and ladies play on Maryland's Eastern Shore? They're holding PJM's annual capacity market auction, where the prices consumers will pay to have generation resources available in 2017-2018 will be determined. Where prices may end up seems to be a matter of opinion. Incumbent generators have been plagued by low prices in previous auctions. PJM's market monitor says the capacity market is broken and has championed several changes that have been recently approved by FERC to raise prices.
PJM has instituted a limit on imported capacity that is supposed to stop the flood of bids from generators in other regions that have been gaming the market by receiving revenue for resources they can't deliver, or resources controlled by other regional operators (yes, big wind, they're talking about y-o-u). Oh, go ahead, read more about it here, but first a little mood music to help you prepare. Sorry about that, but it was actually a pretty concise explanation of PJM's reasoning for the CIL.
The other change is supposed to "result in the more efficient and flexible use of demand response," but will probably just drive some resources from the market altogether. Because demand response lowers overall demand at times of peak use by paying participants to reduce their load, this means that more actual generation capacity will be needed.
But some generators aren't optimistic that the changes will do much to raise prices enough to satisfy their greed and save their bacon. Some generators seem to want more.
And if you think all this capacity auction stuff is about as exciting as watching paint dry, you're not alone. This blogger so thoughtfully compares PJM's capacity markets to steroids in baseball so that we can understand it:
PJM admits that steroids are endemic to the game but then recalculates the final score of the game based on what they believe the outcome would have been if the players were not on steroids. Maybe PJM should just be doing more of this, and less of this.
*Update! PJM has changed its agenda today. It no longer says "Entertainment night with desserts." Now it says "Dessert Reception and Lawn Games." I guess FirstEnergy showed up with the
Another quarter, another FirstEnergy earnings call.
Heavy sigh.
They sounded like they were all on some sort of doggie downer while reading their scripts for the first half of the call. It was only when the line was thrown open to questions that the party started.
Stupid business buzz word for this quarter: "glide path." Ex. FirstEnergy sees its glide path to riches dotted with the corpses of its customers.
It seems that FirstEnergy is about to take one in the shorts because much of its generation was offline during the polar vortex and it had to purchase power. Very expensive power. FirstEnergy also expects to be hit with a bundle of PJM charges resulting from the vortex, but that's okay, the company expects to either drop them on regulated customer doorsteps, stick it to competitive customers through contracts, or simply whine to PJM and FERC about the unfairness of it all. When asked (repeatedly) to put a ballpark number on this, Tony the Trickster avoided the question.
Heavy sigh.
FirstEnergy expects 80% of its earnings to come from its regulated business in the future. That includes FirstEnergy's new found love of transmission upgrades. Once again, FirstEnergy puts all its eggs in one basket. Ooooh! Shiny object! Transmission spend!
Does anyone but FirstEnergy really think that milking regulated customers for transmission upgrades of questionable necessity isn't going to run into a regulatory buzz saw? My Magic 8 Ball tells me "it is certain." Maybe Tony needs to get a Magic 8 Ball to help him run the company?
Heavy sigh.
FirstEnergy is all ticked off about PJM's markets not working. What they mean is that the markets are not working to make FirstEnergy a bundle of money. But, FirstEnergy seem intent on making a regulatory nuisance of itself.
Heavy sigh.
One more thing before I go....
This is a vocabulary lesson for Leila:
The word you were searching for is exacerbate.
exacerbate |igˈzasərˌbāt|
verb [ with obj. ]
make (a problem, bad situation, or negative feeling) worse: the forest fire was exacerbated by the lack of rain.
Here's a link where you can hear the word pronounced.
The word is not pronounced "exasperate." These are examples of incorrect usage:
"The situation with market power prices in January was a product of base load generation that was stretched to its limit and exasperated by gas units that were impacted by constrain gas transmission and high spot trading prices."
"The fact that JCP already has the lowest rate in the state of New Jersey, which again further exasperates the consequence of that."
Leila's misuse of exacerbate exasperates me.
Heavy sigh.
The WV PSC's evidentiary hearing in the General Investigation of Potomac Edison and Mon Power Meter Reading, Billing and Customer Service Practices was held in Charleston December 17 -18. If you didn't have an opportunity to watch the hearing live, never fear, we drove 12 hours, spent 2 nights in a hotel, talked to people we don't particularly like, fended off icy stares, and stayed awake for the entire thing in order to generate 13 pages of notes just so you can find out what happened. The media took no notice of the event, even though FirstEnergy media personality Toad Meyers was there to act as their personal hearing interpreter. Maybe they're waiting for him to share his notes...
If you've never watched one of these hearings, let's set the stage. It's a quasi-judicial, court-like proceeding, sans robes and much of the formality. This was an opportunity for the Commissioners to consider evidence and examine witnesses. Witnesses sponsored by the parties to the case filed written testimony and rebuttals in advance. At the hearing, the witnesses took the stand to have their testimony officially recognized and to give opposing parties a chance to cross examine them. The Commissioners also took the opportunity to ask the witnesses questions. The parties to this case are FirstEnergy's Potomac Edison and Mon Power utilities, the Staff of the PSC, and the Consumer Advocate Division of the PSC. Between them, they produced 6 witnesses, 4 from the company, and one each from the Staff and the CAD.
FirstEnergy's first witness was John Hilderbrand, Director of Operations Support for Mon Power, who was grilled by the attorneys for CAD and Staff, and the Commissioners, for more than three hours. From my notes:
- Exigent circumstances prevented the company from making bi-monthly reads as directed in its tariff. The dreaded "exigent circumstances," or "EC" were defined as: weather, access issues, unplanned absences and equipment failures. Weather = ice, snow, rain, flooding that impedes access to meters. Access issues include a broad range of items such as new gates being erected, no keys being provided, meters on the interior of the home, animals, such as dogs. Unplanned absences = sickness or illness, or 3 personal convenience days that can be used w/24 hour notice.
- Because the company has limited resources, they don't attempt to read in the month following a missed read, when an estimate is scheduled.
- Company now has 7 substitutes, or "rovers" to cover for unplanned absences. This process began several months ago, However, the company did not have substitute meter readers before that. But, there may still be missed reads due to "EC" because there are only 7 rovers.
- The company was not adequately staffed to read meters for some period of time due to merger organization and that contributed to the problem.
- As a result of the merger, meter readers are devoted to meter reading only. (Despite the fact that FirstEnergy was recently recruiting for meter readers that would also perform collection activities and disconnects and reconnects.)
- When meter readers transferred to other positions after the merger, FirstEnergy had to shift resources to read meters and catch up on missed reads. FirstEnergy shifted resources 8/15/11 and again 4/2/2012.
- It takes 6 months to train a meter reader (but the company wants YOU to read your own meter with no training whatsoever!)
- Company has not researched how the storms affected other power companies, but AEP didn't have the same problems because their meter reading is automated and is a different process.
- The proposal to read meters every month for one year would increase the cost to WV ratepayers $5M. But who said WV ratepayers would be paying for that? Nobody.
- Renumbering is a "short term inconvenience to customers" but will make the process better in the long run. Why not a short term inconvenience to the company? It's good utility practice to see that reading is as efficient as possible.
- The company added renumbering to the existing staffing, merger transition and storm problems. But it results in cost savings (for the company!)
- Readers hired since mid 2012 must use their own vehicles. Decision was made as part of merger integration aligning practices across FE and the company always evaluates ways to deliver product cost effectively.
- Meter readers using their own vehicle are paid IRS mileage rates and must carry certain insurance, although the FirstEnergy witness doesn't know how much. "Most" personal vehicles used by meter readers are all-wheel drive, however that is not a requirement. The supervisor inspects the vehicle monthly to ensure the vehicle can complete the route. If a personal vehicle breaks down the company may facilitate getting it back on the road with a tow or a jump, but does not normally provide a back-up vehicle. If a meter reader has continued vehicle issues, that affects the ability to get the job done. Meter readers are not compensated if they don't get the job done.
- When asked about missed readings due to the Derecho, Hilderbrand's logic came up short. Staff attorney John Auville walked him through a typical storm-altered read schedule: The Derecho caused a missed read in the first half of July. The August read was a scheduled estimate. The meter should have been read in September, but was not. Hilderbrand said the company was still not recovered from the Derecho and able to read meters in September. Hilderbrand started talking about the dreaded EC again.
- On renumbering: When you reorganize routes and shift between even and odd cycle reads, that results in some customers being estimated when due an actual read, or some customers receive back-to-back reads (is there anyone this happened to? I'm still waiting for someone, anyone, to tell me they got back-to-back reads due to renumbering). It was a poor decision to renumber the Eastern Panhandle in the winter. Why didn’t FirstEnergy think of that beforehand? The FirstEnergy staff had never renumbered before, so they didn’t understand it.
- FirstEnergy has selected 10,000 residential accounts for monthly reads between Nov. 2013 and Jan. 2014. FirstEnergy has approximately 445,000 customers in WV. At most, this provides one, maybe two additional reads for these customers.
- FirstEnergy has 16,920 "annual read" customers in WV. An annual read customer is one whose meter is read only once per year. Reasons for an account being designated "annual read" include: Safety, access, customer request and seasonal. The company is reviewing these accounts to make sure designation is correct, but has no plans to notify the customers of the review, the results, or notify them of their right to appeal the determination. Maybe that would be a good idea.
- When a meter reading is considerably higher than expected based on prior reads, the reader's hand-held computer unit emits an audible tone that causes the reader to do an immediate re-check. However, it's up to the reader and supervisor to set the parameters of error allowed.
- It would take up to a year to get staff in place to read every meter every month.
- If a reader has access issues, one of several form letters is sent to the customer to remedy the access issue. If the customer fails to respond, the company may be more aggressive in turning off service.
- The company has a 3-day read window for each account during a scheduled read month. If an unplanned absence occurs on the last day of the read window, it cannot be made up. Note that the company can read your meter at any time within that 3-day window.
- Commissioner McKinney vigorously questioned this witness about meter readers driving their personal vehicles and identifying themselves and asked the company to look hard at providing some sort of "work around" in the case of a missed read. Then he started in about renumbering, observing that the company could have chosen to read all meters during renumbering, but they didn’t choose to do that. That’s a resource issue from Commissioner McKinney's perspective. It was something the company made an intentional decision to do.
- Commissioner Albert wanted to know what was going on with the Maryland PSC billing investigation, but couldn't get a straight answer from the witness.
Second witness was Kaye Julian, Director of Customer Management.
- The system has calculated expected consumption and if it falls outside expectations, then it goes to billing personnel for review. This is supposed to catch a large true up. They could send a re-read order or a billing rep. would catch an obvious error. But, if the reader has verified the reading (see #18 above), then they release it for billing. Customer is not notified of the reason for such a high bill, but the company is considering doing that, along with giving the customer payment plan options.
- If a customer's history contains "bad data" (defined as inaccurate estimates) then it’s possible that the estimated reading is going to be inaccurate. If there are more than 4 estimates, then "we do have issues." The company has a levelizing routine for 4 estimates and are confident it’s correct. But if there are more than 5 estimates in a row, it does not work. Those customers go through an estimation routine that uses prior month usage to calculate current month estimate. If the prior month was estimated, this would make the current estimate based on "bad data."
- The company's estimation routine did not perform as they intended it to.
- In April 2012, a computer system change (result of the company's merger) was made that changed the estimation routine. Although Allegheny's estimation routine worked well, FirstEnergy "enhanced" it because it was not possible to retain the old and support the business environment we’re in. In order to share resources it’s best to all be on the same platform – it’s about managing costs and best practice.
- Agrees that adding additional months to the levelizing routine may only add more "bad data" and that an average is only as good as the data used to create it. If data is off, then estimate will be wrong.
- EPRI study of company estimation routine expected January 6. EPRI has been meeting with FirstEnergy "team" and needs more time. Weekly/daily meetings on review that began in July. EPRI is trying to simulate estimation routine with good data and creating other scenarios with additional estimates. EPRI will tell them how to improve. Too early to say if the company will do whatever EPRI recommends because the company doesn’t know how much it may cost. Could reject EPRI's recommendation if it’s too expensive for the company.
- Regarding the 10,000 "special" customers who will receive monthly readings between Nov. & Jan. -- The system picked them based on the following criteria: 5 consecutive estimates in 2012 and more than 25% variance after an actual read. Only accounts with 5 consecutive estimates because the company believes its levelizing routine for 4 or less estimates is accurate. The purpose of actual reads is to replace "bad data" and high true-ups with actual reads because they could not be levelized. The company will reassess these accounts at the end of January.
- Doesn't think actual reads for a year would be necessary based on how the system works and based on read rates. Not all customers were impacted like that. Not all accounts need special handling, just "anomalies" (10,000 accounts).
- Believes there's a difference between a high bill inquiry and a complaint. Maybe the customer called simply because they didn't understand something about their high bill.
- FirstEnergy applied its own estimation routines used for monthly read accounts to Allegheny's bi-monthly read system, but doesn't believe that exacerbated the estimation problems.
- Chairman Albert asked what are "we" going to do with this thing? Lots of customer issues, lack of confidence in the company’s processes. To what extent is somebody going to suggest to us what needs to be done? Julian responded that the company has discovered that their bills are confusing for customers. Will enhance customer messaging on bill to let them know why there is a huge variance in the bill. "Little idiosyncrasies" came out. Chairman Albert asked again about the Maryland PSC case and still got no answer.
FirstEnergy counsel helps out by asking witness on redirect if there is a similar billing problem in FirstEnergy's West Penn Power territory. Julian says there is not because WPP didn't suffer the consequences of Hurricane Sandy.
Next witness was Gary Grant, FirstEnergy's Director of Customer Contact Centers:
- Companies have voluntarily implemented modified guidelines for payment plan procedures for high bills with no financial qualification. Gives the customer a repayment period similar to the estimation period that caused the high bill. Customer Service Reps. offer payment plans as an "opportunity" for customers, but only when they call and ask because each customer is "unique". Hand-out refers to customers as "business partners."
- West Penn Power doesn't have high bill payment plans "at this scale" (not that they don't have the same high bill problems - see paragraph above).
- Disagrees that customers got rude treatment from customer service reps. Wait times at call center have decreased, and the company's robust quality assurance process ensures CSRs are not rude. But did customers in fact express concern during the public hearings? Yes, they said that.
- The company does not inform new customers about the company's bi-monthly reading practices, and if they did it would be an additional cost.
- Commissioner Palmer questioned this witness about hold times once initial contact is made. These hold times are not counted in the company's ASA statistics. The company tracks handle time for individual reps. as well as overall call center, and any hold time would count in the handle time metric. They don't keep track of how long customers are on hold once answered. The supervisor can see how long customer is on hold. When asked if there will be any changes to the process, the witness said just payment plan and high bill refreshers for the CSRs.
- Chairman Albert asked what the harm was in informing the customer about bi-monthly reading when they apply for new service over the phone. The witness said it would add seconds to the call. Chairman Albert speculated that it would add about 3 seconds.
Next witness was Kevin Wise, Director of Rates and Regulatory Somethingorother:
- Witness claimed he had not seen the lawsuit filed by Potomac Edison customer John Kilroy in Jefferson County the day before.
- Said the company would never accept the $5 customer refund for a missed reading, even if exceptions were made for exigent circumstances. Was asked how many times the company would be paying this fine. Said there will always be meters that aren't read and would be estimated.
- Commissioner Palmer asked if the company had future renumbering projects planned. Witness has no idea what the company's future plans may be.
Next witness, Suzanne Akers, Utility Analyst with the Consumer Advocate Division, was cross examined by FirstEnergy's counsel.
- Acknowledged that if the company were to read meters monthly for a year, it would take time to increase staff. Could not answer if the cost of the extra readings would be recoverable in rates.
- Was asked what she would do with those extra meter readers after the year. Said perhaps they may still be needed. Was asked if she would lay off those meter readers, because that might affect FirstEnergy's ability to hire workers. (Hey, I didn't write this comedy, I'm just reporting here.) Akers noted that many current meter readers are contract employees.
Final witness was Michael Fletcher, Deputy Director of Consumer Operations Section at the PSC: - Part of his concern about changing to FirstEnergy's new estimation routine is that under Allegheny’s estimation process, the company did an analysis on the specific customer and had 5 estimating routines to fit different scenarios. Allegheny used to look at what routine is appropriate and current system does not.
- Concerned that sequence of estimates are adjusted for weather, until there are too many estimates and then the routine changes to levelized midstream.
- FirstEnergy's counsel asked if the linear routine uses prior year historic data, and witness said it varied, either prior year or prior month, but neither estimate may be accurate.
- Witness said that the weather-adjusted estimates were put in place in a settlement in the 1990s and if the company wants to change them they should file a new tariff.
- The customer supplied meter reading should be used as supplied if within the company's 3-day read window. (Note #21 under Hilderbrand.) However, the company has been adjusting the customer-supplied reading to their scheduled read date within the window and then marking it as an estimate on the customer's bill. The tariff supports Fletcher's interpretation. Fletcher said that when the customer calls in a reading and the bill shows a different number coded as an estimate, that increases customer anger and complaints.
- FirstEnergy counsel asked Fletcher about several missed read situations and whether they would count as missed reads where the $5 refund applied. Fletcher agreed that some would be exceptions. Fletcher said the company needs to have enough back up meter readers to cover absences. Sick or vacation excuses for not reading meters are not acceptable. He understands the company can’t plan for every eventuality, but needs additional rovers to take up the slack for planned absences. If it’s the same problem that has brought us here because of poor planning, then the refund would apply. The company says they have increased meter readers and fixed all the other problems, and if they have, it wouldn’t apply to anyone.
- The $5 customer charge includes the cost of reading, billing, maintenance, and parties may agree to include charges in there that are not direct customer costs. However, it's primarily related to those items in the Uniform System of Accounts that can be tied to the customer, even if the customer had zero usage. The company’s cost to serve that customer, according to Wise’s testimony says the cost of meter reading is $1.19 (or $1.56 later in the testimony). Meter reading has a $3.7M yearly cost. There are other costs recovered in addition to meter reading. Fletcher is not trying to compensate customer for company’s cost – he was picking easy number to reference ($5).
- FirstEnergy's counsel contends that the $5 refund is performance rate making (where there are penalties and rewards), but Fletcher's proposal has no reward. Fletcher said the reward is not incurring the penalty.
- Fletcher said if a customer got 5 consecutive estimates, it sends incorrect signals to the customer about energy use and is not fair to the customer.
- Chairman Albert questioned witness about exigent circumstances (EC) and whether or not EC can be verified how do we avoid more EC circumstances and whether discount should apply. Aren’t we setting up a system with a penalty that would result in a bunch of contested cases?
If you found this summary interesting, or laughable, check back for links to the hearing transcripts, when they are available.
And now we wait for the Commission to issue an Order to fix this mess. At some point, FirstEnergy has to right its wrongs and make amends to its customers. Otherwise, this saga will simply continue in another venue.
The West Virginia Public Service Commission's evidentiary hearing in the General Investigation of Potomac Edison and Mon Power Meter Reading, Billing and Customer Service Practices is scheduled to take place this week, December 17 - 19.
The hearing will be held in the PSC hearing room in Charleston. The hearing is open to the public as spectators only. There will be no opportunity for the public to make comments during the hearing. The public comment hearings were held in October in Shepherdstown and Fairmont.
If you would like to watch the hearing, but don't have the time or money to travel to Charleston, you can watch the hearing live on the PSC's webcast.
Click here to watch the hearing.
The hearing begins at 9:30 a.m. on Tuesday, December 17 and will probably run the entire day. If needed, the hearing will continue at 9:30 a.m. on Wednesday, December 18, and if still more time is needed, continue again on Thursday, December 19. I really can't imagine it taking that long, there are only 6 witnesses.
The witness order will be:
1. Mon Power/Potomac Edison
a) John C. Hilderbrand
b) Kaye G. Julian
c) Gary W. Grant
d) Kevin Wise
2. Consumer Advocate Division
a) Suzanne Akers
3. Public Service Commission Staff
a) Michael L. Fletcher
Read more about the case and the testimony that has been filed here.
And be sure to check back here, or on the Coalition's Facebook page, for updates during the hearing.
Will justice be done?
Never doubt that a small group of thoughtful, committed citizens can change the world. Indeed, it is the only thing that ever has. --
Margaret Mead
US social anthropologist (1901 - 1978) It appears that EUCI has knuckled under from citizen pressure and kicked Clean Line's executives off the speakers line up for its 8th Annual Public Participation for Transmission Siting Conference scheduled for January 23-24, 2014 in Houston. Clean Line is also no longer sponsoring the conference.
The original agenda put together by Clean Line included offensive sessions entitled "Going BANANAS with NIMBYs - Best Practices in Dealing with Community Based Opposition Groups" and "Marketing to Mayberry: Communicating with Rural America."
The new agenda has been "cleansed" of Clean Line influence and the offensive sessions have been renamed "Best Practices in dealing with community based opposition groups" and "Communicating with rural America," dispensing with the offensive and cutsey-poo insults of transmission opposition groups.
But, does this make EUCI's continuing education conference any more useful? Probably not. It still more closely resembles a transmission industry echo chamber, where industry blowhards make crap up and feed it to the attendees as a successful example to follow. The truth is that "the public" continues to laugh at these idiots' attempts to "participate" with us to successfully site their projects. It's not about "participating" with the public at all... it's about sharing ideas for ways to lie and cheat the public in order to win project approval.
The only way to successfully "participate" with the public is to actually dirty your hands consorting with them, and EUCI isn't about to let THAT happen. Offhand, I can't think of a more useless conference for the industry. For the opposition, however, it's a fun opportunity, as protestors at a Missouri EUCI conference found out a couple months ago. See you there!
Well, isn't this cozy?
FirstEnergy is "sponsoring" a 2014 Legislative Outlook luncheon, and charging the people $15 a head to come talk to their elected officials.
Sort of lets you know who's in charge, doesn't it? FirstEnergy pulls the strings and the legislators line up like trick ponies at the circus... a circus that you must pay to attend.
The WV PSC issued an Order today setting an evidentiary hearing for December 17 - 19 on its General Investigation into meter reading, billing and customer service practices.
An evidentiary hearing will allow interested parties to intervene, file testimony and cross examine witnesses. At the end of the process, the PSC will order remedies, if it determines that any are necessary.
The Commission has set a deadline of November 27 for petitions to intervene in the case.
In addition, FirstEnergy filed its response to the PSC Staff's recommendations.
FirstEnergy is now admitting that maybe we're right. It's the legal equivalent of being "a little pregnant," I suppose.
...the Companies identified accounts in the Potomac Edison and Mon Power territories that we deemed necessary for reading on a monthly basis through at least January 2014 in order to help address the situation. If the Companies are unable to obtain an actual reading for those accounts during that period, the billing department is reviewing the history to manually determine an estimate. If a manual estimate cannot be calculated or other problems are discovered, the account is escalated to a Meter Reading supervisor. How do you suppose these accounts were "identified?" In its monthly statistical filing, FirstEnergy states that there are only "several thousand" problem accounts (out of more than 500,000). I guess that must mean I've heard from every one of those customers over the past year and a half because I'm sure they didn't leave out any of the people who've told me their billing horror story. After last month's review of accounts with multiple estimates during last year's storms and winter heating season, we have identified several thousand customer accounts for special handling. This is a proactive attempt to mitigate compounding issues from a year ago. These accounts will be downloaded for reading on a monthly basis starting November through January 2014. These accounts also have a hold placed OR billing to first allow for an internal review if an actual read cannot be obtained. The review includes a billing representative's analysis of last year's estimation through the winter heating period to manually determine an estimate. If a manual estimate cannot be calculated or other problems are discovered the account is escalated to the Meter Reading supervisor for further handling. So, are you "special?" FirstEnergy still hasn't gotten it right. We are ALL "special."
How much money is this company going to waste on uninspired, half-assed "fixes" and denial of the problem? Will they end up spending MORE than it would have cost to just do it right in the first place?
Thanks for the earnings call fun today, FirstEnergy. It gave Patience and I an excuse to dine on fancy sandwiches and cornichons, drink Raging Bitch, make certain hand gestures at the voices coming out of my laptop, and laugh at all the stupid things your NEOs said. And a fun time was had by all... at least on this side of the internet connection! "FirstEnergy's third quarter net income this year tumbled to about half of what it was a year ago," read the lead of The Plain Dealer's pre-call story. I had to quickly whip up a side of schadenfreude to serve with lunch! Tony the Trickster mentioned that, after recent closings, his "fleet" of generators is now about the same size as FirstEnergy's "fleet" was at the time it merged with and swallowed up the former Allegheny Energy. This wouldn't be the first time I pondered if the merger's sole purpose was to carve up the Allegheny carcass, saving that which benefited FirstEnergy and tossing the rest on the rubbish heap. When does the sale of troubled Allegheny distribution subs begin, now that FirstEnergy has accomplished its evil plan to raise cash by sucking the lifeblood out of Mon Power/Potomac Edison and leaving a dried up, debt-laden shell that no longer provides service to its customers? For example, we have reduced the size and mix of the fleet by closing and selling competitive units. Last month, we closed the Hatfield and Mitchell Power plants and we expect to complete the sale of certain hydro assets later this year. In addition, we completed the Harrison and Pleasants transfer this quarter. Once the RMR units are deactivated, our competitive fleet will be a little more than 13,000 megawatts. This is about the same size as our fleet prior to the Allegheny merger, but it's a much stronger platform of units, more environmentally controlled and more efficient overall. It's all about Tony's "plan" to pull his ass out of the fire. It never was about serving customers, or any of that other dreck two of the WV PSC Commissioners wanted to believe.
Let's turn to an update on the financial plan that we introduced in February. Through a series of actions this year, we have made significant progress towards completing the plan, strengthening our credit metrics and reducing our risk profile.
This financial plan, which is now virtually complete, successfully improves the balance sheet at our competitive and regulated businesses and enhance liquidity in a very short period of time. Tony's next great plan is to plop his "spend" into regulated transmission investment accounts that earn risk-free, high returns.
Last week, our Board of Directors approved as a part of our energizing the future program, a new multiyear $2.8 billion incremental investment in a transmission reliability excellence plan. The plan includes additional transmission investments above current plans, which are expected to be about $500 million in 2014, growing to about $700 million in 2015 and about $800 million in both 2016 and 2017. This program will begin with investment primarily in ATSI, but will ultimately extend throughout our service area. We currently expect to fund these investments with a combination of debt and equity. These projects include rebuilding lines and equipment to improve reliability and reduce future maintenance costs, enhancing and expanding communication networks to harden the system and increasing system capacity to meet the service level and reliability requirements of our customers. This announcement turned the analysts on the call into curious monkeys who wanted to know all about tricky Tony's tantalizing transmission targets, but that wiley old geezer strung them along, talking about rebuilding lower voltage lines that don't require regulatory approval and said he would talk more about it at an upcoming EEI conference. Tony also said that the company is primarily looking to "spend" inside its footprint and not looking for projects that have long lead times with respect to either approval processes or likely construction processes. Because they learned their lesson with PATH? Someone's been paying attention in class! But he forgot to tell them about FirstEnergy's proposal for a project to solve PJM's Artificial Island issues, and any lingering ratepayer-funded PATH assets that may still be kicking around. Do you think the curious analysts were only pretending to be that clueless? In response to a question about coal costs, Donny started talking about pulling his lever. I'll spare you the hand gestures that instigated. And before the laughter had died down, Tony started talking about the possibility of things being soft down the road...I love my job.
Interested parties ask for information and clarification.
Ever made a pot of soup and added too much salt? If you throw in a potato, that will absorb some of the salt, but then you've got too much potato. So, you need to add more water. But then it gets tasteless, so you add some more spices. And then it gets too salty, so you add a potato...
This is how FirstEnergy's West Virginia subsidiaries' usage estimation process has become FUBAR. The only way to fix it now it to dump out that pot of soup and start fresh.
And the only way to start fresh is to read every customer's meter, every month, for at least 12 consecutive months and start with fresh data.
This fact was made perfectly clear to me during my personal "customer service" moment during the WV PSC public comment hearings in Shepherdstown last week.
After witnessing customer after customer being whisked off backstage "to be taken care of" by Potomac Edison personnel after they complained to the Commissioners about their service during the hearing, I started to wonder if the customers were being tied up, consumed by wolves, or simply given Potomac Edison beer cozies and pats on the head before being sent on their way. Curiosity got the better of me when the murmur of an argument somewhere off to stage left escalated into shouting clearly heard throughout the auditorium, and resulted in several bored police officers running through the auditorium to break it up and make the customer move 25 feet away from the Potomac Edison employee he was harassing in the hallway. I simply had to visit the lion's den for myself after the hearing ended!
So, I soon found myself in Potomac Edison's little backstage Happy Town, where Chrissy was eager to solve my problem. She spent a while studying her computer before admitting that she really couldn't help me and went to fetch "analyst" Chris. He spent a bunch of time staring at his computer too. All this chin scratching to figure out why my usage was overestimated by 800 kwh on my last bill, and to assure me that upcoming planned estimates would not be based on "catch up" amounts from the prior year. Chris finally concluded that Potomac Edison's estimation process was correct and wouldn't result in incorrectly estimated bills over the winter. But he could not explain what had failed in my most recent bill that resulted in a rather severe over estimation. If they couldn't figure out what went wrong last month, how could they know that it wouldn't reoccur? The assurances I received were so useless, I started wishing for a Potomac Edison beer cozy to take home as a consolation prize, but it appeared to be locked away somewhere off site, along with Chris and Chrissy's senses of humor.
I did enjoy listening to the "private" conversation going on in the next cubicle where one happy customer referred to a customer service representative as "that brat." Chrissy failed to be amused. I got the idea that she thinks her fellow customer service representatives are never rude or unhelpful. You just keep telling yourself that, Chrissy. I wonder if there's a Rude Customer Service Representatives Anonymous chapter in Fairmont?
"Hi, my name is Brat and I'm rude."
"Hi, Brat!"
"This week, I told a customer that we only had to read her meter once a year."
"That's okay, Brat!"
"And then I made her go out and read her own meter, although she told me she only had one leg and the porch was covered in ice."
"One Day At A Time, Brat!"
"But then I told her she had read the meter wrong and I was going to have to charge her a penalty for that."
"You can do better tomorrow, Brat!"
"And then she asked to speak to my supervisor, so I made her wait while I answered the Giraffe Riddle on Facebook, and then I hung up on her."
"Ohhh, Brat, we love you anyhow!"
The timer on my patience finally got close to zero, so I thanked my Happy Town guides for their time and got up to leave. That was apparently the cue for Creepy Supervisor guy to get in my face and ask me if I had been helped. Oh, c'mon, dude, you were standing right there listening to this whole sad spectacle and I'm sure you weren't doing that because you're hard of hearing!
Silly, silly, silly!
So, here's what's wrong with FirstEnergy's estimation process -- it's broken and cannot be fixed!
When FirstEnergy stopped reading electric meters to save money in the fall of 2011, it created a string of inaccurate data. In the fall of 2012, when this bad data started being used to calculate new estimates, the problem pancaked into some really crazy bills. Then FirstEnergy thought they could devise some method to tweak their algorithm that would set things right. Only that didn't work. They tweaked some more. And tweaked some more. And tweaked some more. What's left is something that is now a completely useless mess. FirstEnergy needs to quit dumping time and money into future tweaks and begin rebuilding an accurate data base. At their own expense, of course.
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