State asks FirstEnergy utilities for more detail on management fixes



Pennsylvania regulators have asked FirstEnergy to provide them with more details on how it intends to fix management flaws — particularly in customer service — that they discovered during an audit of the Akron-based energy giant. 

The audit’s findings, publicly released by the Public Utility Commission at its Feb. 12 meeting, were parsed in 14 functional areas of management performance among FirstEnergy’s four electric utilities in Pennsylvania: the Metropolitan Edison Co., Pennsylvania Electric Co., Pennsylvania Power Co. and West Penn Power Co.

The report found inefficiencies that, if corrected, could save an estimated $19.2 million and at least an additional $3.7 million annually. 

The commission Thursday directed the utilities to respond within 60 days to some of the more pressing of the recommendations suggested by the audit. FirstEnergy has said it is incorporating all but one of the more than two dozen fixes into an implementation plan to be finished by 2019. 

But in a written motion, Commissioner James Cawley had harsh words for FirstEnergy: Many of the most recent audit’s recommendations, he said, relate to previous audit findings that have gone unfixed. 

“Maintaining the status quo is no longer acceptable,” Mr. Cawley wrote. “Rather than impose fines at this time, the companies are directed to use their financial resources to expedite correction of these longstanding performance issues.”

He added: “As it stands now, FirstEnergy only provided very vague assurances that it would comply with this audit recommendation.”

In the audit, West Penn Power’s customer service performance particularly was scrutinized.

From 2008 to 2013, West Penn Power’s rate of abandoned calls was almost twice the average, and rate of calls answered in 30 seconds lagged far behind. In 2013, West Penn representatives answered 69 percent of calls within 30 seconds, while the average was 80 percent.

The utility, which services a large swath of Western Pennsylvania, stands to save the most of any of the four utilities with $8.4 million in one-time savings and about $1.3 million annually. The turnover rate of customer service representatives doubled between 2009 and 2013, when one in four representatives left within a year they were hired.

Mr. Cawley’s acknowledged West Penn has implemented some changes during periods of high call volume, but “despite these changes, the contact center performance is still not comparable” to FirstEnergy’s other Pennsylvania utilities. 

In a statement, FirstEnergy reiterated it is continuing to address the audit’s findings to improve overall reliability.

“We will need time to carefully review Commissioner Cawley’s motion, and the resultant commission order, in their entirety, and look forward to working with the [commission] staff,” it read.

Daniel Moore: dmoore@post-gazette.com, 412-263-2743 and Twitter @PGdanielmoore.

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