CMP penalized $10M over customer service complaints
The Maine Public Utilities Commission on Thursday punished Central Maine Power Co. with a $10 million earnings cut after a year-long investigation into ratepayer complaints and deciding CMP “must meet higher standards of performance in both customer service and reliability.”
The earnings cut, which is made by reducing customer rates, will remain in effect for at least 18 months and can only be lifted when the utility meets quality benchmarks and convinces the commission that service problems have been fixed, according to a news release.
“This [earnings] disallowance is the largest ever imposed by the commission on a transmission and distribution utility due to poor management,” the PUC said in the release. “As a result, CMP will likely have the lowest common-equity return of any electric utility in the country until its performance improves.”
The $10 million penalty, even larger than the one proposed by PUC staff last month, is a response to “numerous complaints” made by consumers since a spike in bills during the winter of 2017-18.
The PUC examiners attributed much of that increase to record-breaking cold weather and a scheduled increase in the standard-offer electricity supply price. However, the staff did find fault with the CMP billing software, known as SmartCare.
Calling its implementation “imprudent,” the examiners said technical problems “affected tens of thousands of customers who experienced delayed bills or bill errors.”
In their decision last week, the commissioners agreed with the staff report.
PUC Chairman Philip L. Bartlett II said, “We have listened carefully to customer concerns and closely examined all the facts in these cases. Our decisions today will hold CMP accountable. And will require a dramatic change in how CMP treats its customers.”
In addition to the financial penalty, the commission imposed other requirements on Maine’s largest electric utility. They include additional testing, complaint resolution and performance reporting on SmartCare; an independent management audit of CMP with the goal of improving customer service; credits totaling nearly $360,000 to customers on the Electricity Lifeline Program due to a billing defect; and the continued investigation of individual high-usage complaints.
In a separate action, the commission approved a “modest rate increase” that represented about half of the amount CMP had requested. The increase will be partially offset by the earnings reduction, resulting in a hike of about 2% in the average residential monthly bill, according to the release.
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