Colbeck regarding DTE penalties: Record fines needed, people must be compensated

LANSING, Mich.State Sen. Patrick Colbeck commented Monday on the interim findings from the Michigan Public Service Commission’s (MPSC) formal investigation of DTE Energy regarding multiple consumer protection violations and illegal shut-offs, many of which occurred in the 7th District.

“No fines have been levied against DTE by the MPSC yet,” said Colbeck, R-Canton. “But clearly we have to go beyond DTE’s suggestion that the biggest penalty they pay is the detriment to their customer satisfaction, and not in any type of financial penalty.”

The MPSC findings, released Feb. 21, highlight how DTE has been caught violating several consumer protections rules, sometimes resulting in people having their power cut for inappropriate reasons. While the company has blamed many of the problems on a new computer system, Colbeck said the most recent issue fits into a longstanding pattern of poor customer service that arises when people don’t have the option to show dissatisfaction by voting with their feet.

“We’re dealing with residential abuses against captive customers here,” Colbeck said.  “Many of these people were getting shut off in error during some of the coldest months we’ve seen in a decade, and it frequently took much too long for power to be restored. I think when the investigation is finished record fines will be required. We need to find a way to have real money flow back to affected customers in a manner that serves as true compensation and deterrence.”

Several hearings in the Michigan House have taken place on this issue. In one instance, a representative from DTE offered that the damage to customer satisfaction was a strong enough penalty. DTE also attempted to tout a customer service award as validation of their commitment to customer service, even though they ironically issued the press release for the award at the very same time they knew they were illegally shutting many people off from power in the middle of winter.

“If DTE wants to show its commitment to customer service, quit touting sham awards and immediately begin to financially compensate these people,” said Colbeck. “They should publicly apologize to customers they left in the dark who were trying to comply with a smart meter program they never even wanted in the first place; they should offer people the ability to keep their analog meters; and if they aren’t willing to do those very reasonable and necessary things, they should set those customers free and offer them the ability to get a third party meter and electric service through somebody else.”

One of the last large fines for a systemic utility violation was in 2016 when Consumers Energy was charged roughly $500,000 for estimated billing practices. Colbeck said that because of the nature and scope of the current problem, he expects fines against DTE will be much higher and that he wants to make sure people who were inappropriately shut off see payment for what they went through.  The fine money from 2016 did not go directly back to affected ratepayers.

“This could be a multimillion-dollar fine, and I don’t believe current compensation to people for utility misconduct is adequate nor necessarily automatic,” Colbeck said.  “I will continue to work with the MPSC to recommend changes to their rules that I think we can all benefit from. I’m hopeful we will find some areas we can agree on, but if not, I’m working on legislation that would ensure that real consumer protections exist and that ratepayer rights can be fully exercised.”

Colbeck has previously submitted several suggestions for rule changes to the MPSC designed to make sure that the recent problems with DTE don’t happen again, and if they do, that they can be detected and stopped earlier by the state.

“Part of the problem is that utility reporting is insufficient, and in many cases rules are being waived for years at a time,” Colbeck said. “We have people complaining that their meters aren’t accurate, yet I can’t read the reports on that because the reports don’t exist because the rules that require them have been waived. The state needs to start doing things to restore the public’s trust, to show them that their state government is looking out for them and not gaming the system against them.”

Colbeck said one particular source of frustration are rules that hinder ratepayers from trying to even help themselves. Customers currently have the right to try to request and be granted hearings where they can seek redress, but current rules are being used to deny these people assistance who either can’t find or can’t afford a lawyer.

“There is a lot of confusion,” Colbeck said. “People invest time driving all the way to Lansing from places like my district to try and exercise their right to a hearing. Yet when they get here they are told they are not allowed to have someone assist them despite what the MPSC website currently says (see HERE, HERE, and HERE). What is the harm in having a daughter assist an 80-year-old father at a hearing?  What is the harm of someone having a person by their side to help keep them organized?

“The utilities have armies of lawyers, yet we are shutting the door on ratepayers in what is already a David vs. Goliath situation. We need to change the rules to reflect what is allowed according to the MPSC’s very own guidance, both to get rid of confusion and to allow people to truly exercise the rights they are supposed to have.”

Colbeck said he expects record public attendance at the next phase of the hearings, which takes place at 9AM this Friday, March 2 in Lansing.

 

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