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Estimated PSEG utility bills have some customers reeling

Mike Pedano stands near the electric meter outside

Mike Pedano stands near the electric meter outside his home in South Farmingdale on Monday, May, 11, 2015. Pedano said PSEG overestimated his November 2014 bill -- his regular balanced bill of $195 jumped to $352.17. It took several months for the utility to rectify the error, he said. Credit: Newsday / John Paraskevas

A winter uptick in the number of electric customers whose bills were based on long-term estimates is causing consternation among ratepayers facing sometimes eye-popping tabs when the meter reader finally arrives.

While the meter-reading rate, which hit a low of 55 percent in February, has since rebounded to 97.3 percent, the lingering impact remains pronounced in the number of long-term estimated bills as of March, which hit an annual high of 5,788, according to figures from PSEG Long Island.

Long-term estimated bills are those based on six months or more of estimates for residential customers or three months for commercial. One of the problems with estimated bills is that they can distort the true picture of customer usage. The longer the estimate period, the more PSEG has to rely on past usage or guesswork to draw up bills. When bills are finally reconciled, customers may be faced with higher-than-expected charges.

Michelle Migliozzi and her husband, Renato, experienced it firsthand in November, when PSEG read the meter on their under-construction home in Ronkonkoma after nearly a year of estimates of between $8 and $86. A surprise November bill of $3,035 came for the home, which still had no appliances, Michelle Migliozzi said. "We did everything efficient and we're still not even in the home," she said.

PSEG said the problem was a power-hungry water heater the family used through cold winter months to prevent their radiant-heated floors from freezing. The utility worked out a payment plan for the Migliozzis to pay $288 a month to make up the past-due balance. But the high bills continue. With a past-due balance that now stands at $3,258, she said, the family received a $430 bill for March. Michelle Migliozzi said she has asked for a new meter.

In the case of estimates, it is impossible to accurately assign usage into months they cover because readings don't exist to verify the months in which it occurred. That's a particular problem because PSEG's power supply charge fluctuates monthly. Customers could overpay if too much usage is assigned to months with higher power supply charges. Fred Daum, director of customer contact and billing at PSEG, said the utility prorates usage over the period of estimates so that "in some cases that can benefit a customer."

Winter can slow reading

Still, for customers such as Thomas Italiano of Medford, the use of estimated bills leads to suspicion, incredulity and, ultimately, dispute.

PSEG was unable read Italiano's meter -- it says because of a locked gate -- between February and October last year, when it was finally able to get to his meter to reconcile his charges. The result: a bill for more than $2,600 in January, when prior estimates were trued up.

Italiano hit the roof. He has filed a formal grievance with PSEG and the state Department of Public Service, and he continues to dispute more than $1,800 in charges. He also disputes PSEG's claims that it could not read his meter for most of last year, saying he spoke to a reader in September and directed him to the meter.

"They are trying to extort me through a fraudulent billing program," Italiano said Friday.

PSEG spokesman Jeff Weir denied the claim, saying the meter readers couldn't get access to Italiano's meter because of the locked gate. He said the company has since found a different route to Italiano's meter and now reads it bimonthly. The past due balance represents a true-up of Italiano's usage, he said.

More generally, Weir said the utility's low meter-reading rate was the result of a decision to keep its meter-reading force off the street during the worst of the winter weather to help improve a measure of worker safety.

The 55 percent meter-reading rate in February compared with the prior year's 90.5 percent rate for the month. Bills based on long-term estimates that month in 2014 spiked at 6,123 customers.

'Never underestimate'

For the vast majority of PSEG residential customers, meters are read every other month. Yet most of those customers receive bills monthly, which means half the bill is based on estimates. Bills are then reconciled the following month. (Most commercial customer demand meters require monthly reads.)

When a customer becomes a long-term estimated account, monthly or bimonthly charges are based on prior usage and other factors such as weather and billing days.

Some complain estimates are too high, almost always in the utility's favor. Mike Pedano of South Farmingdale said he received a bill with an estimated reading for November showing a spike in usage. His regular balanced bill of $195 jumped to $352.17, raising suspicions because, he said, "I live like a monk."

He paid the bill, but when he called PSEG several weeks later to complain, he provided an actual reading. It turned out the utility had overestimated by more than 449 kilowatt-hours. The overpayment covered his entire December bill and part of his January bill.

"Why should they have my money?" Pedano said. "They never underestimate."

Jason Wornstaff, a chemical engineer from East Islip, doesn't wait for estimates. He keeps a schedule of meter readings and calls in his usage on or around the day that utility readers are scheduled to visit. "In all my years I have never found once an estimated bill that was ever in my favor," Wornstaff said.

Alternative meter readings

Technology could help, but it's uncertain how quickly PSEG will be able to integrate smart meters that send in readings multiple times a day. At a recent LIPA trustee meeting, board member Jeff Greenfield suggested that PSEG adopt a system that allows ratepayers to email a photograph of their meter. PSEG said it would review the proposal.

Smithtown resident Joan Batchelor was one of those long-term estimated billing customers. Her meter wasn't working for nearly a year because a bees' nest jammed the dial. She received estimated bills even though a meter reader came to her house to read the meter, which showed no usage. Recently, PSEG replaced the meter and sent her a refund check for $1,390, because it had no record of her actual usage.

In Italiano's case, PSEG acknowledges it has no way of telling how much of his usage occurred in each of the months for which it estimated his bill. PSEG instead prorates the usage over time, using historical and other measures.

PSEG says it expects to end 2015 with a meter-reading rate that will keep the company on course to receive a performance incentive from LIPA. During the month of April, meter-reading inquiries to PSEG made up 13 percent of all calls to the company, compared with 21 percent in January.

But total calls to PSEG, including outage reports, complaints and general inquiries, gradually increased between January and March, from 162,322 to 169,467, respectively. In April the number dropped to 152,231.

How to Avoid Estimated Bill Surprises

Look at your bill carefully each month. If the estimate for any given month appears out of line, call PSEG Long Island to complain.

Read your own meter. PSEG customers can call in their own meter readings. You can call the utility at 800-490-0025 to provide the reading. Information on how to do it is available on PSEG Long Island's website.

Get an energy audit. Have PSEG staff come to your house to review your appliances to find out which might be causing excessive usage.

File a complaint with the Department of Public Service. If you're not happy with PSEG's response to your complaints about estimated bills, call the Department of Public Service at 800-342-3377.

Source: PSEG Long Island, DPS

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