The Maine Public Utilities Commission on Thursday ordered the shareholders of Central Maine Power Co. and not its ratepayers to foot the $580,000 cost for an audit that found problems with the way the utility handled customer service issues with its new billing system.
The three commissioners voted unanimously that the shareholders will bear the full cost of the audit by Liberty Consulting Group of Pennsylvania.
Under Maine law, ratepayers typically pay the full cost of a management audit. One exception is if an audit of an investor-owned public utility like CMP results in a commission finding of “imprudence,” or a lack of care, that in turn causes a financial penalty.
The commission found imprudence, and had asked for public comments about who should pay for the audit.
“Given the circumstances that led to the audit and the magnitude of harm to ratepayers from the imprudence it uncovered, it would be unfair to expect ratepayers to absorb any of the costs of the audit,” the commission wrote in its order.
[iframe url=”https://www.documentcloud.org/documents/6876394-F9BDC37D-7F75-41AE-BBE4-D37FF23A7FD4.html#document/p1″ height=”450″ width=”600″]
“CMP will comply with the order and has no plans to appeal it,” said company spokesperson Catharine Hartnett.
The commissioners voted unanimously in January that CMP must compensate customers who had a billing error, regardless of whether they had previously filed a complaint. In a related case, the commission also ruled that CMP’s poor performance warrants a more severe “management efficiency adjustment” that could cost CMP shareholders $10 million. That means CMP’s profits would be at least $10 million less for the next 18 months.
The orders came in late January despite the commission having ruled earlier that it agreed with the Liberty audit’s finding that the CMP SmartCare billing system had no systemic issues.
In its statement to the commission about the audit payment, the office of Public Advocate Barry Hobbins said, “CMP’s mismanagement of SmartCare was the impetus for the Liberty audit.” Hobbins argued that CMP shareholders should pay for the audit.