State utility regulators have taken the first step toward a broader investigation of how Central Maine Power’s management by parent company Avangrid may be hurting Maine customers.
The order is the result of an independent audit of CMP released in July. The audit was ordered by the Public Utilities Commission last year after an investigation into billing mismanagement and other customer service issues at the state’s largest energy provider surfaced.
Now, the PUC is ordering the utility to file a report by Nov. 30 on how it will address the concerns raised in that audit, including “concrete actions” for making sure company leaders are meeting CMP’s operational needs and fixing any systemic issues that stand in the way.
“I am concerned that significant problems could keep arising if steps aren’t taken to fix the underlying management problems that have plagued the company,” PUC chair Phil Bartlett said during deliberations Tuesday.
He said the audit warned that the billing issues the state investigated in 2020 may not have been an isolated problem, but instead stemmed from lax oversight and support of CMP by Connecticut-based Avangrid and its parent company, the Spanish energy giant Iberdrola.
CMP said in a statement on the investigation that it plans to continue excellent service in Maine under the leadership of their new CEO Joe Purington, who began work this week after a short stint leading operations in New Hampshire for New England’s largest utility, Eversource.
“CMP has made demonstrable improvements in our daily service to customers as measured by responsiveness to customer calls and billing accuracy and timeliness,” the utility’s statement said. “We remain committed to sustainable improvement across the company.”
But Bartlett said the audit suggested that once CMP pays off a $9.9 million state penalty for the billing issues, “the company’s focus could again slip without that significant financial incentive to improve,” especially as it becomes “an increasingly smaller piece” of its parent firms.
He said the audit also raised concerns about Avangrid’s board structure, CMP’s staffing and the company’s readiness to keep up with the coming push for electrification and renewable energy growth under Maine’s aggressive climate change goals.
After it receives CMP’s report in November, Bartlett said, the PUC will decide whether to open a full investigation of these issues, which would include adjudication and “appropriate remedies.”
Dan Burgess, director of Gov. Janet Mills’ energy office, said he supports the PUC’s order.
“We ... strongly believe that Maine should use every regulatory tool within its power to ensure that our electric utilities are meeting their statutory mission to deliver safe, reliable and adequate services at just and reasonable rates for Maine people,” he said in a statement. “We welcome and applaud this new and stronger level of oversight.”
Tuesday’s PUC order includes a summary of comments on the audit from CMP, which said it doesn’t think an investigation is necessary but asked for a narrow focus on issues precipitating the audit if the case does proceed.
The Office of the Public Advocate, meanwhile, commented that recent state investigations show that CMP “has struggled in carrying out many of its core public utility functions,” leading to “a loss of customer confidence.”
Problems with CMP’s management, the advocate said in the PUC order, include the apparent disinterest of Avangrid’s board in CMP problems, overemphasizing cost-cutting to achieve short-term earnings goals and capital investments to achieve long-term ones, and the delegation of certain planning tasks to finance staff instead of engineers.
The advocate also commented, according to the PUC order, that “CMP’s failure to acknowledge the problems in the report is itself support to open an investigation.”
State Rep. Seth Berry, a Bowdoinham Democrat, went a step further. He has advocated for the creation of a consumer-owned utility in Maine to replace CMP, and said the PUC is limited in its ability to fix the company’s inherent problems.
“They’re the symptom of the moment — they’re not the underlying disease,” Berry said. “The real issue is … a globalized monopoly system that guarantees profits at the expense of people and planet.”
While he said the investigation could “yield some short-term good behavior from our utility,” he suggested that it’s unlikely to give Ibedrola any more real stake in serving Maine customers.