The audit reveals potential violations, prolonged readings estimated counters in RG & E / NYSEG following News10nBC surveys

ROCHESTER, NY – The independent audit of RG & E and NYSEG is finished and it supports the years of news report of News10NBC on the main billing problems and customer service problems among public services.

Auditors have made 128 recommendations on how RG & E and NYSEG can improve operations and do better for customers. In addition, the Ministry of Public Service has published an apparent notice of violations against the public services resulting from the examination by audit personnel and information concerning the recent operations of public services.

For years, News10NBC’s investigation journalist Jennifer Lewke has explained the billing, customer service and performance problems highlighted in this new audit.

The CEO of RG & E and NYSEG previously admitted that the public services were in sub-employment leaving the pandemic, during a transition to a new billing system and behind meter readings. It threw thousands of customers in chaos.

Although things have improved in recent years, listeners say that public services still have a long way to go.

In September 2023, the Public Service Commission NYS selected an independent and third -party auditor to carry out a management and operations audit of NYSEG and RG&E. In the final report published Monday which represents nearly 500 pages, the listener makes 128 recommendations to companies which both belong to Avangrid.

Notable audit results include:

• Attributions of service costs and agreements: The auditor noted that the complex structure of the Avangrid company makes it difficult to determinate if the charges it attributes to NYSEG and RG & E are based on cost causation. Companies receive goods and services from 13 affiliated companies. Some of these affiliated companies are companies for several public services, thus limiting the transparency of allowances and making the verification difficult if the costs are granted appropriately. The auditor recommends that companies revise and update the cost distribution manual and simplify the cost distribution process.
• Yield management and remuneration of incentives: According to the listener, all performance management activities occur at Avangrid level. Avangrid does not develop operational plans to achieve objectives related to NYSEG and RG & E. The listener found that the incentive payments for managers are subjective and are not based on the achievement of specific objectives in NYSEG and RG & E. The audit recommends that Avangrid performs a third party examination of the individual measures of the NYSEG and the CEO of RG&E and interrupt the discretionary assessments.
• Physics and cybersecurity: The auditor noted that physical and cybersecurity programs are administered at Avangrid level and that the cybersecurity program does not mature as it should, despite cost increases. The auditor has recommended that Avangrid strengthens its cybersecurity planning documents and the measures used to follow performance and improve staff declaration.
• Electrical operations: The auditor said that asset management is also managed at Avangrid level. AVANGRID has not implemented a formalized and integrated asset management software platform and is always based on spreadsheets. Avangrid underpins asset management, contributing to poor performance of NYSEG electrical reliability. The audit recommends that Avangrid implements an asset management system for NYSEG and RG & E.
• Customer operations: The auditor noted that Avangrid does not have appropriate controls for the outsourcing of customer service, examination and approval of increased personnel invoices or contract management. The listener recommends that Avangrid determines the drivers to increase the costs of the call center and check if they are attributable to NYSEG and RG & E. The auditor also found that metric reports of the company’s customer service indicator (CSPI) have been inaccurate and recommends that Avangrid update its CSPI process documentation, to create a formal replacement process and to improve quality control.

RG & E and NYSEG must file a plan to find out how they intend to solve each problem with the NYS public service commission by June 18.

In addition to the recommendations, the staff of the Ministry of Public Service think that NYSEG and RG & E will violate state regulations as follows:

• The Board of Directors consists of ineligible administrators because they also occupy positions of managers or administrators of unregulated affiliation companies, which seems to be incompatible with the 2013 order of the commission authorizing the insertion of Avangrid Networks, Inc. in the structure of ownership of companies.
• Potential violations concerning the maintenance of customer billing records and its invoicing procedures which led to extended estimated meter readings.
• On gas safety, DPS staff alleys that NYSEG and RG & E did not comply with regulatory requirements to report their response time to gas leaks or emergencies.
• With regard to electrical reliability, DPS staff alleys that NYSEG has not complied with enforceable reliability standards for six consecutive years, despite payment of negative income adjustment payments for these failures and despite the approval of the larger budget commission for capital and maintenance programs in the last two cases.

RG & E and NYSEG must file a plan to explain how they intend to resolve each of these questions with the Public NYS Service Commission by June 18^th.

In a press release, a spokesperson for RG & E and NYSEG says: “We respect the hard work of the Public Service Commission (PSC). We are currently examining and assessing the management audit report and the today’s management audit order rendered by the Commission and we are impatient to respond. NYSEG and RG&E remain at our doors to invest millions in upgrading hundreds of gas lines in our service areas supported by rigorous and permanent inspections carried out by our dedicated field teams. We have changed our management structure in NYSEG and RG & E, with staff with only responsibilities from New York who presented themselves directly to the CEO and the President of New York to better meet the specific needs of our operating companies. Consequently, our customer service and our billing performance have also experienced a significant improvement. Hundreds of new team members have been added, less than one percent of the 3 million invoices issued require adjustments, and customer service has reduced waiting times for less than 30 seconds. With regard to any potential violation notice, we are impatient to respond with clear facts that show that our companies have fully complied with all laws, commission orders and regulations. These are real actions with real positive results for our customers, and we hold firmly behind our file, our employees and our continuous commitment to provide safe and reliable energy to millions of New Yorkers every day.“”

The previous coverage of News10NBC Bringing problems / RG Customer Service: