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Edison may face millions in fines

Written by : , Category : wdltvvre , Date : January 3, 2020 , No Comments on Edison may face millions in fines

first_imgROSEMEAD – If a judge for the California Public Utilities Commission gets his way, Southern California Edison will pay $200 million in fines and ratepayer refunds for rigging customer satisfaction surveys – a move that allowed the utility and its employees to collect larger bonus payments. Administrative Law Judge Robert Barnett outlined his proposed penalty during a public hearing Thursday held by the California Public Utilities Commission. Barnett said Edison, California’s second-largest utility, should return $160 million in financial incentives, paid by its customers through their electricity rates as a result of the falsified surveys. Edison should also pay a $40 million fine, Barnett said. The utility – a unit of Rosemead-based Edison International – disclosed in 2004 that an in-house investigation found some employees had rigged the surveys. At the time, Edison told the commission that knowledge of the survey-rigging scheme did not appear to go higher than middle management, one of four groups eligible for the performance bonuses. The company has argued penalties against it should be limited to the nearly $50 million in bonuses and a $2.5-million fine. Barnett, one of two officials who presided over the probe into Edison’s actions, has yet to formally issue his judgment against the company. Once he does, it becomes final after 30 days, unless there is an appeal or a member of the commission seeks further review of the case. Barnett also suggested the commission should consider compensating Edison employees who blew the whistle on the scheme. SCE addresed the problem in a variety of ways prior to the CPUC investigation. Actions taken include: An internal investigation of information SCE received of employee misconduct The decision to broaden the investigation to ensure the reliability of other reporting systems Self disclosure to regulators and the public Disciplinary actions where appropriate Organizational changes made to ensure the problems would not reoccur Employee training initiatives The commitment to return to customers $49.5 million in financial awards The Utility Reform Network, a watchdog group that “stands up for consumer rights, affordable rates and a more livable California,” says the judge’s proposed penalty is just. “The judge is the one who heard all the evidence, read all the filings and analyzed all of the arguments,” TURN spokeswoman Mindy Spatt said. “We believe he’s come to a very good decision.” Staff writer Kevin Smith contributed to this report. 160Want local news?Sign up for the Localist and stay informed Something went wrong. Please try again.subscribeCongratulations! You’re all set! On Friday, Edison spokesman Gil Alexander said the utility preferred to reserve comment until the commission issues a written decision. The company has argued penalties against it should be limited to the nearly $50 million in bonuses and a $2.5-million fine. Under the CPUC’s performance-based rate-making mechanism, the results of customer satisfaction surveys are used, in part, to determine whether SCE receives an incentive reward or penalty. To bolster the outcome of Maritz Corp.’s independently conducted customer satisfaction surveys, SCE workers falsified client telephone numbers – and in some cases inserted their own phone numbers – so they could pose as clients and give SCE glowing reviews, Stephen Pickett, SCE’s senior vice president and general counsel, said in a June 2004 interview with this newspaper. Some SCE field workers also failed to record negative encounters with customers, he said, which should also have figured into the survey results. last_img

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