New president of RG&E and NYSEG opens up about billing issues, public outcry

At any other time there may have been more accolades and recognition for the appointment of Patricia Nilsen as president and chief executive officer of Rochester Gas and Electric Corp. — the first woman in the company's nearly 175-year history to ascend to the job.

Instead, she has taken the helm of RG&E, as well as New York State Electric and Gas Corp., or NYSEG, at a tumultuous time: Consumer complaints are rampant, with state investigations ratcheting up; a proposed rate increase is receiving significant pushback and has led to negotiations with state officials; and there is growing momentum for a publicly-owned utility.

Nilsen has been with the companies since 1992 and succeeded Carl Taylor, who retired at the end of June. The anger with the utilities is so deeply felt now that steps to improve and change could well seem like too little, too late.

But, Nilsen said in an interview last week, she and the companies are trying. RG&E has significantly increased customer service numbers; is hiring more meter readers; and is working toward the installation of "smart meters," which should eliminate the estimated power usage that became particularly problematic during the pandemic.

Many power reading estimates in the past year or more have been "significantly off," she said. "Couple that with turnover, and 'the Great Resignation'; we have not been untouched by that."

While RG&E is bolstering its customer service numbers to add employees and replace others, it will clearly take a significant turnaround in public attitude toward the utility to alter widespread dissatisfaction. RG&E is asking for a rate hike of approximately 20 to 30 percent in its electric and gas rates — the utility says it, too, has been hit by inflationary costs and also worked to keep rates steady during the pandemic — and that request has brought out intense opposition.

"We all know that rampant inflation is hitting consumers across the spectrum right now," said Joseph Stelling, AARP's New York Associate State Director of Advocacy. "Their request is a lot higher than the rate of inflation."

Many of the AARP's members are on fixed income and end up deciding whether to significantly lower the heat within their homes, skip prescriptions, or limit food purchases, Stelling said. "They become horrible choices," he said.

The AARP is one of a number of organizations opposing the rate increase, and has also come out against a requested delay in a hearing on the proposal so utility officials and state officials could continue negotiations. The state needs to hear from consumers in a hearing, Stelling said, instead of reaching a settlement.

Billing issues at RGE, NYSEG lead to complaints to New York Public Service Commission

Nilsen's trek to the leadership of major utilities was not a standard journey.

She holds a master’s degree in English from Syracuse University, a master’s degree in adult education from Elmira College and a bachelor’s degree in English and Fine Arts from Alfred University. Nilsen envisioned a career in teaching, but instead joined NYSEG in human resources and then corporate communications.

A Binghamton resident, she took on positions with Avangrid, the parent company of RG&E and NYSEG, including a key role in its emergency preparedness. According to the company, Nilsen "led crisis response to system emergencies across all eight of Avangrid’s electric and natural gas companies."

Over the past few weeks, Nilsen has been holding media availability, highlighting the company's current efforts to try to make improvements. Describing what the utilities have faced as a "storm" of hurdles, Nilsen says she is both realistic and optimistic: The consumer complaints will not be resolved overnight, she said, but she thinks headway and improvements will be obvious.

"Our customer service is staying in close contact with the PSC," she said of the state Public Service Commission, which regulates utilities and investigates consumer complaints. "We work very collaboratively."

PSC officials announced in late December that an ongoing investigation into consumer complaints with RG&E and NYSEG was widening.

"The problems with the two utilities’ billing systems became apparent when the Department began tosee a significant spike in the number of complaints from customers," PSC said in a statement.

"The complaints received by the Department range from incorrect bills being sent to consumers orvery late bills being sent. In 2022, the number of consumer complaints against the two companiessoared to more than 4,700, 60 percent more than the two previous years combined."

Mike Coniff, the founder and chief executive officer of Refugee Resettlement of Rochester, said the billing problems and subsequent unreliability of consumer complaint response has been particularly burdensome for the newcomers his company tries to help settle into a new country.

One Afghan man received a bill of about $1,000 after moving into a new home, Coniff said. The amount made no sense, and those trying to help him struggled to get a sufficient explanation.

"Everything was estimated," Coniff said. "He got this whopper of a bill. Then we go down and read his meter and now he's got a credit for three months.

"It just all seems very dysfunctional," he said.

What led to issues at RGE, NYSEG?

The billing, consumer problems, and complaints to the state are first and foremost on the list of issues being tackled, Nilsen said.

One problem for both NYSEG and RG&E was the growing use of renewable energy with the utilities, and how to integrate those programs into billing, she said. The systems required more manual input of usage information than in the past, she said.

During the pandemic, the company lost employees and meter readers could not go into homes. The estimated billing numbers and the loss of employees created a significant problem, Nilsen said.

"The estimates ended significantly off," she said. "... A lot of utility companies are seeing some of the same thing."

In response to the complaints, RG&E said it last year increased the number of customer service workers and is doing so again this year. It added new billing specialists, and allows for appeals from customers who think their billing is inaccurate.

Installation of the so-called "smart meters," which allow utilities and customers a much simpler and regular reading methodology, will begin this year and be completed in three to five years, Nilsen said.

"It's hundreds of different meter types that we have to swipe out," she said.

The pandemic also caused issues for the utilities with inflationary costs and supply "pain points," delaying some connections with construction projects, Nilsen said. The utility is now collaborating with the Rochester Home Builders Association.

Calls to make RGE a publicly-owned utility

The RG&E issues have intensified the call for a publicly-owned utility, an initiative headed by Metro Justice, a progressive nonprofit, and receiving support elsewhere, including some local lawmakers. The plan has not been endorsed by the mayor or county executive, but Metro Justice hopes that an "implementation study" can be completed and bring more enthusiastic backing from key legislators.

"The implementation study will give us the road map for how to give us a utility that is better than RG&E," said Mohini Sharma, Metro Justice's lead organizer. "We can make a transition comprehensive and equitable."

Sharma said RG&E's billing issues, as well as its difficulty responding to some past outages, clearly demonstrate the need for changes. While commending the steps taken by the utility, she said, "These issues are not really new issues."

Locally, Fairport, Churchville, and Spencerport all have public utilities. The change requires a referendum, one that supporters would like to have on the ballot for 2024.

Supporters contend that public utilities across the country have demonstrated how rates can be reduced and significant infrastructure improvements made, such as major moves toward pushing utility lines to underground placement.

Asked about the possibilities of a public utility, RG&E officials contended that government would be in control and that "Government Controlled Power would require taxpayer investment and would disrupt the nearly 800 jobs RG&E has in its Rochester division.

"In 2021, RG&E contributed more than $165 million in tax revenue to local municipalities and the state that supports our local schools, public safety, infrastructure and other crucial services in the communities we serve. This revenue and reinvestment would be lost" with the public utility, the company maintained.

AARP, which has been one of the key organizations in negotiations over proposed rate hikes, has not taken a stand on the public utility proposal. Its focus is ensuring its members are treated fairly and don't suffer with the rates, said Stelling.

That, and reducing the consumer complaints from its overall customer base, may well be the most pressing issues for Nilsen in her first year.

People's needs "to keep the power on and keep their home heated in the wintertime hasn’t decreased," Stelling said.

This article originally appeared on Rochester Democrat and Chronicle: RGE, NYSEG billing issues: CEO opens up about public outcry