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Conectiv chief apologizes Utility's planned efforts fall short of PSC request

The News Journal/SUSAN L. GREGG Howard Cosgrove, chief executive of Conectiv, says that he expects that most of the billing problems will be settled by the end of March. By BILL YINGLING Staff reporter 02/25/2000

Conectiv's chief executive apologized Thursday for the persistent problems plaguing the company's billing and customer service operations.

"We know we have fallen short of the expectations that our customers have of us," said Howard Cosgrove. "We bear the responsibility for producing timely and accurate bills."

Cosgrove said Conectiv will open a group of walk-in service centers on the Delmarva Peninsula for customers who prefer to resolve billing problems in person rather than over the telephone.

He predicted that most of customers' billing problems would be resolved by the end of March.

But Conectiv's move falls short of what Public Service Commission staffers have requested. The parties are headed for a meeting in front of the five regulators Monday to debate the issue.

Cosgrove, during a news conference at the company's Wilmington headquarters, discussed a series of steps the company is taking to resolve problems created by the December conversion to a new computer billing system.

The company, for example, has decided to open five temporary walk-in centers. Four of the centers are in Delaware, and are two fewer than were requested by PSC staffers. The centers, however, will be open only two days a week rather than six days, as commission staffers are requesting.

The commission staff has requested that the PSC take emergency action and order Delaware's largest power supplier to begin solving its persistent billing and customer service problems.

PSC staffers also want:

Conectiv managers to attend a series of public meetings in Delaware. The company to suspend its automatic payment program in which it withdraws funds directly from customers' bank accounts. The 13,000 customers would continue on the program only if they gave written authorization.

Only 50 customers have canceled the service thus far, Cosgrove said.

Conectiv tried to explain the billing conversion to customers with an advertising campaign before the conversion. But Cosgrove said the utility did not anticipate the size of the problems the new system created.

"I think we underestimated the impact and the time it would take us to fix some of the initial problems," Cosgrove said. "It was a little bit of a snowballing effect. We weren't able to fix the initial problems quickly enough and they kept on building."

Other steps Conectiv said it has taken include:

Hiring and training 137 new customer service representatives, a 68 percent increase. Adding 120 incoming and 48 outbound telephone lines. Adding eight new meter readers in northern Delaware to a staff of 32. Meter readers are working overtime to reduce a backlog of bills that must be processed, Cosgrove said. Sending Conectiv representatives to speak to community groups. Adding nine computer programmers, bringing to 74 the number working mandatory overtime to solve the problems. Programmers have fixed about 1,500 flaws in the computer's coded instructions. They have 275 problems remaining, the company said.

Cosgrove said Conectiv's efforts have been productive.

About 99 percent of all bills are now accurate, compared with a historical average of 99.5 percent.

And about 94 percent of customer bills are being mailed on time compared with 82.6 percent when the computer was launched.

Bruce Burcat, executive director of the Public Service Commission, said it's good that Cosgrove has become visible on the subject. But he said the company's news conference won't prevent his staff from seeking an emergency order from the commission.

"I think it's an important step that Mr. Cosgrove presented the company's view of what they are going to do for the public," Burcat said. "However, there are many details that need to be addressed at the commission's meeting on Monday. And there are still a number of open issues to be resolved."

Cosgrove's remarks represented his first public comments on the subject since the company launched the new system Dec. 11.

State officials, many of whom have been hearing customers' complaints, said they were pleased to see Cosgrove speak out.

"It should have happened a long time ago," said Pat Stowell, Delaware's public advocate.

Sen. George Bunting, D-Bethany Beach, said Cosgrove needed to show some leadership on this issue.

"Now I'm glad to see he stepped forward," Bunting said. "It will truly be a test to see whether he can correct this billing problem that has affected people up and down the state."

Cosgrove made his appearance less than a week after Public Service Commission staffers filed the motion for emergency action, threatening that the company could be fined for failing to maintain a reliable billing system.

Cosgrove on Thursday said the company is handling the problem without regulatory oversight.

"I have no idea what they do," he said. "I'm focused on meeting our customers' needs. If I solve that problem, everything else should get worked out over time."

Conectiv previously operated walk-in customer-service centers in Delaware. It closed them about two years ago because executives decided the public was not using them.

But two months ago the company converted to the new computer billing system. The system produced thousands of incorrect bills, which were mailed to customers.

While making the conversion, the company disrupted many customers' billing schedules.

Conectiv since has been struggling to recover from the problem. It has been trying to correct the computer problems and handle an overwhelming volume of complaints from outraged customers calling by telephone.

The company ordinarily mails about 1 million bills a month, Cosgrove said. Of that, it usually has a backlog of about 15,000 bills a month that it delays mailing to check by hand for mistakes.

During the conversion to the new computer system the backlog grew to about 61,000 bills. It has since been reduced to about 40,000.

Cosgrove said the company is increasing from 76 to 100 the number of people reviewing bills by hand. By the end of March, he expects the backlog will be reduced to normal.

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-- Martin Thompson (, February 25, 2000

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