Gov. Janet Mills on Monday called Central Maine Power’s failure to deal with its long-running billing problems “unacceptable,” a day after a Portland Press Herald/Maine Sunday Telegram investigation revealed how CMP managers misled the public and mismanaged the launch of a trouble-plagued billing system.

“CMP owes Maine people honest and direct answers about their egregious billing errors,” Mills said, “why they happened and how they are fixing them, and they owe Maine people fair and accurate bills.”

Customers began receiving erroneous bills within days of CMP’s switch to a new billing system in October 2017.  More than 100,000 customer bills were inaccurate. But the number is likely to be higher because 97,000 of the company’s roughly 620,000 customers received bills at least 50 percent higher that winter than for the same three-month period a year earlier.  Many customers got no bills at all – and were shocked when the eventual balance became more than they could afford.

Public Advocate Barry Hobbins Tux Turkel/Staff Writer

Mills said she fully supports the Public Utilities Commission’s ongoing probes. If the issue isn’t resolved there, she said, she will work with Public Advocate Barry Hobbins to hold CMP accountable.

Hobbins said Monday that the newspaper’s report highlighted a  pattern of CMP downplaying bad news.

“Deep down,” he said, “I don’t know whether Central Maine Power attempted, early on, to cover up their issues. It’s unsettling that there’s that possibility. They had an approach, the deny, deny approach, that’s now unraveling on them.”

Hobbins said he was surprised to read the newspaper’s account of how CMP’s project manager for the new billing system, called SmartCare, held up the project as a major success at a conference last year in Texas. He said it raises fresh questions about CMP’s integrity that warrant further examination.

“That is stunning, from my standpoint,” he said. “That will open other questions that will be put on the record.”

The comments by Mills and Hobbins come amid mounting scrutiny of the actions of CMP managers who oversaw the rollout of the troubled billing system. They also coincide with threats to the financial bottom line of CMP’s domestic parent company, Avangrid, according to new guidance to investors from a stock analyst who follows the utility.

CMP spokeswoman Catharine Hartnett acknowledged Monday that the company could have done more to prepare customers for the launch of the new billing system and should have better managed questions from customers after it went live.

She said the company has taken responsibility for unacceptable service and acted quickly to hire more staff and increase training. It also is cooperating with the PUC probes, and is “completely transparent” in sharing information.

“We know we have a lot of work to do to regain the trust of many who were affected, and this will take time proven only by our efforts to provide better service,” Hartnett said.

The newspaper’s investigation found that officials at CMP and its parent company cut corners, skirted best industry practices and failed to adequately test a new error-prone billing system launched in the fall of 2017. The meltdown of the $56 million billing system reveals a pattern of corporate mismanagement and unfulfilled customer promises spanning much of this decade.

Because utilities are regulated, earning levels are set by the PUC. But if regulators find evidence that a utility acted in an imprudent way, some of that profitability, or return on equity, can be disallowed, hurting shareholder investment.

In a summary for investors released Monday, Bank of America/Merrill Lynch analyst Julien Dumoulin-Smith said Avangrid “continues to deal with backlash from high bills and increasing distribution rates.”

“Latest conversations with key stakeholders highlight expectations that the Maine Public Utilities Commission will take some action to hold CMP accountable – critical as the company awaits an outcome on its rate case,” Dumoulin-Smith wrote. “One way in which the PUC might act is by lowering the authorized return on equity to below current levels. …”

Dumoulin-Smith’s summary was apparently unrelated to the newspaper’s investigation, and he didn’t respond Monday to a request to speak with the Press Herald.

Despite other factors that might offset an earnings hit, Dumoulin-Smith wrote that Bank of America would maintain an Underperform rating for Avangrid. That means the stock is expected to do worse than the overall market. “We see risk to earning at current authorized returns as even more certain than before,” he wrote.

Dumoulin-Smith noted an additional risk: a pending class-action lawsuit by disgruntled customers.

The newspaper’s account of customers who took desperate measures after getting exorbitant bills also sparked a new wave of disaffected ratepayers wanting to join plaintiffs in a lawsuit against CMP. Since Sunday, about 150 people have contacted CMP Ratepayers Unite, which is made up of about 8,000 utility customers, seeking to join their legal battle, said Scarborough attorney Sumner Lipman.

“We are getting absolutely inundated today,” Lipman said Monday. “Most of these people are fed up with CMP’s excuses and the PUC not doing anything. They are struggling to pay their outrageous bills. We haven’t even begun to talk to all of them, but they all want to join the case.”

The suit seeks class-action status, but is on hold at the Business and Consumer Court pending the conclusion of the PUC investigations, Lipman said.

Lawyers have selected four people to represent the different types of customers who believe they have been harmed by CMP’s billing issues, including Christie Decker of Wilton and Lisa MacLeod of Greenwood, two CMP customers whose stories were told in the Maine Sunday Telegram.

Jeff Russell, a lawyer representing the plaintiffs, called the newspaper’s stories “an illuminating and disquieting account of the day-to-day tribulations that continue to plague customers statewide. CMP, Avangrid, and their leadership have done wrong by the people of Maine, and hundreds of thousands of customers are worse off today because of it.”

CMP’s billing problems, and strong opposition to the company’s proposal to build a transmission line through western Maine, were catalysts for anti-CMP bills in the last legislative session. Among them is a proposal to buy out CMP and Emera Maine and create a consumer-owned public power company. That plan is now subject to a pending study at the PUC.

Rep. Seth Berry, D-Bowdoinham, the bill’s lead sponsor, said the newspaper’s reporting reinforced his longtime accusations.

“In sum,” he said, “CMP has lied, gravely and repeatedly, both to policymakers and to the public. Lack of disclosure or undue spin from a regulated monopoly is very serious, but lies are far worse. A regulated monopoly that cannot tell customers the truth is no longer fit to serve those customers.”

The coverage also drew reactions from members of Maine’s congressional delegation.

Rep. Chellie Pingree, the Democrat representing Maine’s 1st District, said she wants CMP held accountable.

“Electricity is a basic lifeline,” she said in a statement. “It’s unconscionable that CMP was so slow to take responsibility for a massive systemic failure that has caused thousands of Mainers to make horrifying personal sacrifices simply to take a shower or have light in their own homes.”

Republican Sen. Susan Collins said in a statement: “I am concerned by the reports of numerous Mainers who experienced issues and whose electric bills increased dramatically overnight. The stories highlighting drastic steps some Maine households have been forced to take in an attempt to lower their energy costs are startling.”

Independent Sen. Angus King, a member of the Senate Energy and Natural Resources Committee, also is troubled by how Mainers have been affected by CMP’s billing problems.

“Maine people work hard to pay what they owe, and they deserve certainty and affordability as they pay their bills,” King said in a statement emailed Monday night. “CMP needs to work with the ongoing Maine Public Utilities Commission investigation to figure out exactly how they can adjust their procedures and start regaining the trust of their consumers.”

The PUC issued a statement Monday outlining the actions it has taken to investigate the billing problems, and highlighted public hearings scheduled for July 16 in Portland, July 18 in Farmington and July 22 in Hallowell. Agency spokesman Harry Lanphear also alluded to the potential for financial penalties if the PUC investigation finds that CMP “failed to provide safe, reliable and adequate utility service.”

Staff Writer Penelope Overton contributed to this report.

 

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