National Grid's natural gas operations on Long Island will pay an $8.9 million penalty for failing to meet two important state measures of performance in 2014.
National Grid missed state Public Service Commission targets for customer satisfaction and the number of complaints received, according to the state agency.
Information provided by the state said the utility blamed cold weather, its 2014 separation from the Long Island Power Authority and a billing system conversion for the problems.
The penalty will impact National Grid shareholders, not ratepayers.
"The rules in place establish strong standards for performance and put significant amounts of shareholder earnings at risk for nonperformance," PSC chairwoman Audrey Zibelman said in a statement.
National Grid in a statement said it "just missed the PSC performance mark by less than 2 percent and we are working diligently to address the areas that require improvement to ensure customer satisfaction."
"Our goal is to meet or exceed all these targets every year," National Grid spokeswoman Wendy Ladd said. "We are focused and making solid progress on improving our customer satisfaction results in 2015."
One National Grid customer who complained to the utility for months this year over an inflated bill said he agreed with the state's assessment of the utility.
Faisal Zakaria of Jericho in May received a $4,493 gas bill, more than 10 times his normal usage. While telephone representatives acknowledged a mistake, he said, correcting it took months.
"Initially, it was horrendous," he said. "Every time I called I went through the same phone tree and had to go through the motion of telling the next person the same story."
National Grid resolved the problem last month.