Sunday, August 24, 2008

Provo Daily Herald Calls For Questar To Absorb The Entire Cost Of Its Transponder Malfunctions, Not Just A Mere 13.6 Percent

On Sunday August 24th, 2008 the Provo Daily Herald published an editorial column about Questar's efforts to recover underpayment for natural gas because their transponders caused the meters to record only half the natural gas used by customers over a given period of time.

Specifically, the company incorrectly installed transponders at 400 homes and 117 businesses. The devices reported only about half the gas that was actually used. Once Questar discovered the error, they immediately sought to recover the costs and, without any advance notice, back-billed those customers for the gas they had actually used -- $1,200 on average. Talk about sticker shock; customers predictably howled, and many filed complaints with the Utah Public Utilities Commission.

After pondering customers' complaints, the Utah Division of Public Utilities told Questar it could back-bill those 517 customers for six months of gas and seek about $621,000 from the rest of its customers to help make up the difference. Questar would absorb only $98,000 of the loss.

But that's not good enough for the Daily Herald. They say Questar should pass none of the charges on to the affected customers. They should eat the entire mistake. And they offer a good comparison as compelling justification:

Yes, they [the customers] did use the gas. But in all transactions, the seller is responsible for charging the right price. For example, say you're at the supermarket, and you see hamburger marked at $1 a pound. You pick up a package, take it home and cook up the hamburger. If the supermarket called the next day and said the packages were mislabeled and demanded that you come back to pay another $1 a pound, you'd laugh and hang up. And most of us would be pretty steamed if the Utah Division of Hamburger Regulation said we had to pay any part of that tab.

{snip}

That's unconscionable. Questar should eat the whole amount.

We consumers have to trust the company to accurately record how much natural gas we use, because it's not a commodity we can measure on our own. After all, if the customers knew how much their gas bills really were, they could have made adjustments to conserve. Instead, they're being treated as debtors.


The last paragraph is particularly important. One can easily determine the accuracy of hamburger pricing by looking at the label and comparing it with the appearance of the product. But how can an ordinary person just as immdiately spot a malfunctioning utility meter, unless it's not functioning at all. The "good faith" clause comes into play here.

However, there's one other factor in Questar's defense that was omitted from the Herald's analysis. If Albertson's or Smith's wants to raise the price of hamburger, they don't have to spend thousands of dollars preparing a case for a price increase to be heard before a state "Division of Hamburger Regulation". The grocer merely changes the price. But a public utility cannot just raise rates on the fly; they must appeal to the Public Utilities Commission, spending thousands of dollars preparing justification. Consequently, to hold a regulated public utility accountable on exactly the same level as a less-regulated grocer may impose too much of a burden on the utility.

Nevertheless, the Daily Herald is absolutely correct in their assertion that Questar is getting off too lightly. After all, it was their mistake; they must take greater responsibility. And the best way for them to take greater responsibility is to split the loss 50-50 with the affected customers, at the very least. For Questar to absorb only 13.6 percent of the loss is a disgrace and a slap in the face of their customers.

Questar's ham-handed hardline predatory tactics in handling this situation will not soon be forgotten, regardless of the outcome. Questar has already instituted two rate hikes this year, adding an average of $163 per year to a customer's bill. The Public Services Commission has scheduled hearings on Questar's back-billing issues Oct. 22-23. Public comment will be accepted from noon to 1:30 p.m. and 4:30 p.m. to 6:30 p.m. Oct. 22 at 160 E. 300 South, fourth floor, in Salt Lake City.

1 comment:

steel68 said...

A large energy company taking one on the chin for consumers.Riiight!Maybe we can get Exxon and BP to kick us down some checks.We all know their exorbitant profits were accrued through "normal free market capitalism".

The cancer of the Golden Calf has metastasized at such a rate now that even non-Jews are Jews in their insatiable lust for profit.There is no breaching the Matrix!

"The devout and politically free inhabitant of New England is a kind of Lacoon who makes not the least effort to escape from the serpents which are crushing him.Mammon is his idol which he adores not only with his lips but with the whole force of his body and mind.In his view the world is no more than a Stock Exchange,and he is convinced that he has no other destiny here below than to become richer than his neighbor.Trade has seized upon all his thoughts,and he has no other recreation than to exchange objects...In North America,indeed,the effective domination of the Christian world by Judaism has come to be manifested in a common and unambiguous form:they preach of the Gospel itself,Christian preaching has become an article of commerce."-Karl Marx