UCAN

In 2010, when the FCC began discussing government mandates that would allow consumers to avoid overages, Verizon said they had it under control.  There have been a slew of reports on the internet lately about Verizon customers receiving overage charges without receiving an alert from Verizon.  Verizon lobbyists filed comments specifically stating that customers receive alerts on the 20^th day of their billing cycle if they are set to go over their allowances for that month.

However, there’s been a recent slew of backlash on the internet from customers who have, in fact, NOT received these alerts.  Most notably was Consumer Reports writer Jeff Blyskal, who incurred $70 in overage charges without so much as a peep from Verizon, if you are going to pick and choose who you send your alerts to, an employee of the biggest organization dedicated to consumer protection is not a good account to skip.

We’ve had consumers tell us they are experiencing similar problems, especially with international roaming.  Just a few days ago we were contacted by a gentleman who incurred a $500 international roaming bill.  Verizon alleges they sent him text alerts, but he reports that he never received them.

Failing to send promised alerts is bad enough, but we’re also questioning the efficacy of a text message alert system.  Is it sufficient to alert customers of overage charges? 

Specifically in the case of international data roaming, a text alert doesn’t make much sense.  The horror story we usually here is the of the customer that dutifully buries his smart phone away in his luggage, for fear of accidentally placing a call or reading a text and receiving a roaming charge.  Little does he know that his smartphone is accessing data and updating without his knowledge or intent. 

In cases like this, where customers see opening their phone as anathema, is it useful to send them a text message?  How about an email alert instead?  This same customer that ignores his phone while abroad is probably still checking his email through an internet café or through a wifi connection on his laptop.

UPDATE: After hashing out a few of the most egregious overage issues with Verizon, we're finding an interesting trend. When aggreived customers reach the first one or two tiers of customer service, they are being offered paltry credits of 15% to 30% off the fees. That may seem like an okay resolution at first glance, but when you're looking at $1500 in fees, knocking $300 off still leaves you with a crippling bill to pay. However, once escalataed to the highest levels of customer service, companies like Verizon and T-Mobile get considerably more generous - - we're seeing 100% credits for cases where customers couldn't access the notifications and made a legitimate effort to not use the network. Even on iffy cases where customers saw the alerts and didn't change their behavior, executive customer service is willing to fork over a 50% credit.

It's good that escalated cases are getting refunds, but it's troubling that wireless companies are forcing consumers to go to these lengths for credits. For the time being, if you're bowled over with overage bill shock and getting nowhere with customer service, get that bill escalated. The easiest way to do so? File a online complaint with your state's public utilities commission or with the Federal Communications Commission. It's the quickest way to get your issue up to the wireless company's top dogs.

Have you incurred overage charges at home or abroad without an alert from Verizon?  If so, we want to know.  Fill out our online complaint form and we’ll investigate on your behalf.

Source: http://news.consumerreports.org/electronics/2011/09/verizon-wirelesss-ph...

 With the most current round of UCAN's inserts in the City of San Diego water bills, our phones have been lighting up like the Christmas tree at Rockefeller Center. Many people have legitimate gripes about their water bills and the City, from their bills being too high to not being able to reach a live person on the phone. But one thing we've noticed is that many people do not know how to read their water bill. The callers can definitely see how expensive their water bill is each month, but they don't know what each line item represents. We can help break though all the confusion, but we have to warn you that you can't unsee the horrors that are the Four Horsemen of the Water Bill.

Four Horsemen of the Water Bill

Like their distant brethern in equitation, the Four Horsemen of the Water Bill each represent a terrible thing: a line item on your City of San Diego water bill. Separately, each line item packs a powerful punch against your pocketbook. But unite their powers and you'll experience a pain unlike any others.

1) Water Base Fee - The water base fee is a flat rate per month based upon the size of your meter. For the typical 5/8 or 3/4 inch meter, the monthly base fee is $19.33. This fee covers meter maintenance and other administrative costs.

2) Water Used - This is the charge for the water you actually consume. The City bills you in HCF, or hundred cubic feet. One HCF is equal to a shade over 748 gallons, or 748 gallon cartons of milk. The City has a tiered rate structure, meaning the more water you use the more you pay per HCF. The cheapest water rate is the first tier, which gives you up to 7 HCF per month. The second tier is between 7 and 14 HCF per month. The third tier is above 14 HCF per month.

3) Sewer Base Fee - Like the water base fee, the sewer base fee is a flat rate per month. Since there is no sewer meter, all single-family residential customers pay the same monthly rate: $16.28

4) Sewer Service Charge - This is the charge for your use of the City's sewer system. Unlike the water use charge, the sewer service charge is not based on your sewer use that billing period but an annualized rate that is calculated during your Winter Monitoring Period. This charge depends not on the amount of water you use in a billing period but on the amount of days in the billing period. If you didn't have a Winter Monitoring Period in the previous year, the City charges you the new customer sewer service charge based upon 9 HCF per month--$34.39 using the current sewer rate.

When Powers Combine

As I mentioned before, the potetency of each individual line item is compounded when all the charges are added together. Not including the water use fee, a new customer will pay $70 per month for the water base fee, sewer base fee, and sewer service charge. However, the City bills you bimonthly--once every two months. This means we need to double the monthly charges, making a new customer's bill--without including the water use fee--$140 every billing period. Shocking, yes, but not as shocking as this next revelation: three out of the four horsemen are fixed charges.

Yes, that's right. Three out of the four main charges on your water bill have nothing to do with how much water you use in a billing period. I'll repeat that last point for emphasis: three out of the four main charges on your water bill have nothing to do with how much water you use in a billing period.

The Fix Is In

If you re-read the description of the water base fee, the sewer base fee, and the sewer service charge, you'll find that these are all fixed costs. Whether you use 1 HCF or 100 HCF, those three charges are fixed and will not change. The only portion of your bill you control every month is the water use charge. 

To further exmplify this point, what would happen if a City of San Diego water customer used the lowest billable amount of water every two months--one HCF? Using one HCF would put this conserving customer in the first tier of $3.612 per HCF. For the sake of argument, let's say this customer also had an annualized sewer service charge of one HCF, which would add another $3.8211 to the bill. The customer's overall bill for a two month period would be $78.65. Almost $80 to use one HCF that cost $3.612. 

Frightened yet? It's not even Halloween yet and I'm terrified of the Four Horsemen of the Water Bill.

Have you experience the wrath of the Four Horsemen? Let us know in the comments or fill out our online water complaint form.

Fairness. It is a fundamental question in our society. How we operate, how we live, often comes down to a question of what is fair. What does fairness have to do with SDG&E request for $1.5 billion “general rate” increase? Everything. After a year-long investigation by UCAN’s team of experts have found that over the last years SDG&E’s rates have skyrocketed, its profits soared, and its executives reaped large bonuses all while its customers suffered through the worst recession since 1929. Sound fair yet?

SDG&E claims that increasing costs of doing business necessitates $1.5 billion more of its customers’ money. For 2012, the increase would start at $168 million and grow over the following three years. UCAN and its team of experts poured through SDG&E’s books and reached an entirely different conclusion. Not only does SDG&E not need more money, in fact, it could actually use less money than it currently collects.

UCAN was able to document $142 million in inflated costs, which if adopted would pare back the rate increase to $26 million. When we pair this with large potential cost savings, as much as $200 million in reduction, found by the regulatory staff at the CPUC the math says there should be a rate reduction.

So here is that question of fairness. While customers are in the midst of the worst recession in many of our lifetimes, should ratepayers be funding SDG&E’s wish list of expenditures or should state regulators actually reel in SDG&E’s spending to meet its actual need and spare its customers significantly increased costs?

Now you may be asking yourself how SDG&E concluded its needs a $1.5 billion rate increase in 2012 while UCAN concluded SDG&E could actually use a rate reduction. Through its year-long investigation UCAN’s team of experts uncovered an amount of budgetary mischief that exceeds anything UCAN has witnessed in the past 25 years. So much in fact, that UCAN has called upon the Commission to reevaluate the General Rate Case process. Here is just a small sampling of what our experts uncovered:

• In almost every single operational department, SDG&E's bonus-happy managers have found reasons to increase their annual budgets. The only department with a substantial decrease: meter reading. That’s only because there are no more meter readers due to the $578 million spent on installing smart meters. SDG&E then inflated costs in almost every operating account, after reducing costs the previous year, through use of a five-year average.

• SDG&E overstated operational challenges, if not dangers, that it claims require massive infusions of money

• It manipulated forecast data developed by others in order to achieve outcomes that are more favorable.

• SDG&E sought incentive ratemaking treatment for performance that is marginally competent and created employee incentive programs that disproportionately award suboptimal performance. SDG&E also issued to its employees 517 American Express Travel cards from 2008-2010. In the 2008-2009 time period, charges on this card increased from $693,379 to $1,024,979, or over 45% in just one-year’s time.

• SDG&E only offered cursory justifications for most increases, thus requiring an extensive and time-consuming discovery process for every account. UCAN had to pose 72 sets of data requests containing over 5000 questions and, in many cases, never secured complete answers. One glaring example was its failure to detail its over $6 million in public affairs expenses, despite the CPUC requiring SDG&E to provide “a more detailed justification for all public affairs and outreach expense to demonstrate genuine customer benefit that outweighs any incidental corporate image enhancement."

• SDG&E disregarded commitments made (and directives given) in the previous GRC and using its discretion to fund projects that it had reason to believe the Commission would not have approved

• And it resisted any cost-effectiveness analysis for major initiatives.

These mischievous tactics did not prevent UCAN’s experts from uncovering numerous examples of excessive or unnecessary expenses and other disturbing findings including:

• Two of UCAN's analysis teams found that SDG&E management slashed spending at the company during 2009 and 2010. However, the increased net profits caused by the under spending was directed towards increasing executive bonuses and inflating shareholder returns. Not a dime of it went to lower rates. And now, SDG&E is asking for double-digit increases above the rate of inflation in many cost categories, including the very operational expenses that management cut in 2010. It is asking for those increases across the organization rather than in a select number of accounts to guard against regulatory focus on any one aspect of its operation.

• Since 2008, SDG&E’s system average rates have leapfrogged to the highest in the continental United States and the highest in California, by more than 15%. Where just five years ago SDG&E's rates were about the same as the other California utilities, now we are higher by double-digits in the midst of a full-blown recession. As of 2011, SDG&E's residential average rates are 18.4 cents per kWhr.

• SDG&E's residential customers are currently paying 13% more than SCE customers and almost 15% more than PG&E customers. Notably, at the last rate case in 2008, the residential rates for all three utilities were just about the same (15.6 for SDG&E, 15.0 for both SCE and PG&E).

• Only after the 2008 SDG&E GRC decision, did SDG&E's rates jump well above California's other two energy utilities while SDG&E reaped record profits and management bonuses.

• It wants $83 million to “help” customers who buy electric cars and for burdens caused by customers who use solar to generate their own power. UCAN's experts have found that electric car customers do not need SDG&E's help and that solar panels help SDG&E's system, not burden it.

• SDG&E seeks $13 million to place power lines underground to make them less susceptible to fires. A number of the proposed undergrounding projects however are not located in fire-prone areas.

• SDG&E proposes to need $7.1 million to "fire proof" a transmission line to Mount Laguna. Mount Laguna has 32 households suggesting SDG&E wants to “fire proof” that transmission line at a cost of $221,875 per house.

• SDG&E wants $6.9 million to place solar panel installations its SDG&E properties. But SDG&E's version of solar PV is so expensive that it will take 53 years to pay it back.

UCAN’s experts in addition to its numerous findings made a series of recommendations that support its conclusion for a rate reduction rather than yet another rate hike for SDG&E. Here is just a sampling of those recommendations.

• SDG&E should be compelled to maintain internal data to help gauge the effect of IVR on overall customer service quality. This includes tracking average time of an IVR call and average total call to time to CSRs (including IVR).

• SDG&E should also take steps during this period to evaluate the cost-effectiveness of implementing Internet based services for customer support.

• Rather than continue to spend millions on a project that its own data suggests will not improve interactions with customers, SDG&E be required to implement Internet-based alternatives. A corresponding reduction in IVR expenditures is made in the Testimony of William Marcus on behalf of UCAN.

• SDG&E should transform its call center into a contact center planning to utilize web efficiencies to improve the customer experience.

• SDG&E should be investing in Live Chat functions, E-mail with Artificial Intelligence, a function for helping consumers find a rate plan that fits their needs, and online customer surveys.

• Commission should not fund vague project to increase spending on social media without a more compelling showing that adoption of social media will enhance its customer service and reduce its customer outreach costs.

• Allocation of Sempra lobbying costs assigned to SDG&E must be cut in half to better reflect the lobbying specifically done on SDG&E‘s behalf.

• The Commission should prevent SDG&E from using ratepayer funding to engage in corporate image enhancement, promotion of SDG&E political initiatives, or the purchase of giveaway items by imposing a disallowance and should renew its justification requirement that it set forth in the 2008TY General Rate Case.

• Disallows 50% of all of SDG&E forecast travel costs. SDG&E's failure to document its travel expenditures justifies that shareholders share in the costs of all travel for which ratepayer funding is sought.

• Disallow all dues paid to Chambers of Commerce.

• Disallow costs for memberships, dues, or contributions to organization whose work involves political lobbying or advocacy and where SDG&E has not met its burden of showing a clear and specific benefit to ratepayer.

• UCAN recommends that SDG&E be obligated to split the costs of the service guarantee program with shareholders until the next GRC TY, at which time, if it provides details of these costs, the program might, once again, be fully funded by ratepayers.

• UCAN recommends a reduction in funding of $994,000 in the administrative programs supporting Clean Energy Program initiatives.

• The Commission should deny a $2.23 million increase to Electric Clean Transportation project.

• Reject future funding for the Energy Innovation Center also known as the San Diego Energy & Environment Center and to disallow expenditures of at least $2.4 million for monies already spent on this Center.

To read all of the finding and recommendation of UCAN’s team of experts see UCAN’s published testimony available at http://www.ucan.org/energy/electricity/general_rate_case_2012/ucan_testi...

Despite these findings of UCAN and the potential cost reductions found by the CPUC staff, it may not be enough to convince the Commission to not grant SDG&E’s wish list of expenses. SDG&E’s customers need to take advantage of the opportunity to give regulators a piece of their minds during the week of October 10th. During that week, there will be eight public hearings throughout the County. The regulatory agency that will make the final decision on SDG&E's rates will be taking public input on the proposed rate increase. Hearings will be held in San Diego, Chula Vista, El Cajon and Oceanside.

If you can afford a 5-7% rate increase locked in for the next four years, then you needn't do anything but sit on a couch and wave goodbye to your money. But if you feel that you simply cannot afford higher gas and electric prices at the moment, you need to make your feelings known at the upcoming public hearings held at 2pm and 7pm at each of the four locations:

• San Diego: October 10, 2011 (Al Bahr Shriners Center, 5440 Kearny Mesa Road, San Diego 92111)

• Chula Vista: October 11, 2011 (Comfort Inn & Suites, 632 E. St., Chula Vista 91910)

• El Cajon: October 12, 2011 (El Cajon City Hall Council Chambers, 200 E. Main St, El Cajon 92020)

• Oceanside: October 13, 2011 (Civic Center Library, 330 N. Coast Highway, Oceanside 92054)

If you are a Cox subscriber, you will probably receive an email from Cox explaining a nifty new tool for its customers. Called the Data Usage Meter, Cox believes this tool will help its customers make informed decisions about their internet data consumption. And here at UCAN we're all for giving customers information and tools to help them make informed decisions. But tacked at the end of the second paragraph of the e-mail (see the PDF copy attached at the bottom of this post) was a startling piece of information: Cox gives you a data alottment that depends on your Internet package. Surprise!

Digging further into this, it seems that at least since June 16, 2011, Cox has put limitations on the amount of downloading and uploading you can do each month. If you subscribe to Cox's lowest tier internet package, you get a measly 30 GB. If you subscribe to Cox's highest tier Internet package, you get a whopping 400 GB.

Interestingly enough, even though Cox considers each of its Internet packages to have a data allowance, there is no penalty for exceeding your allowance. From Cox's Data Usage Allowance FAQs:

What happens if I go over my monthly data usage allowed by Cox?

Cox notifies customers if they exceed their data usage allowance -- and works with them proactively to resolve the problem. In some cases, customers do not even know they are exceeding the allowance because their computers are infected with a virus that is spewing spam or otherwise consuming data. In others, customers choose to reduce their data consumption or select a different Cox High Speed Internet package that better fits their needs.

Other than the mildly distrubing mental image of your computer spewing spam, this seems fairly straight forward. Cox wants to make sure that the data consumed from your account isn't from some malicious piece of software. But if you exceeded the data usage allowance because you actually use your internet connection, Cox will suggest that you upgrade to another Internet package. Since there is no penalty for exceeding the data allowance, you will be paying Cox more money to access the same amount of bandwidth. Cox can argue that you'll have faster download and upload speeds on a higher-tier plan; but, at the end of the day you will still be consuming the same amount of total bandwidth and paying Cox more money. That's a kind of math you didn't learn in grade school.

Even though Cox doesn't charge any penalty for exceeding your data allowance right now, that doesn't mean it won't in the future. What do the FAQs have to say about the issue:

Will I be billed if I exceed these allowances?

Cox does not currently charge you an additional fee if you exceed your allowance. If you determine that your Internet data usage consistently increases, we recommend that you consider a Cox High Speed Internet package that more closely matches your use of the service. 

Cox won't charge you right now if you exceed your data allowance, but that word "currently" worries me. Does it mean that something is brewing in Cox's cauldrons, with that something being a fixed data cap that is trendy among many telecommunications companies (e.g. AT&T). Anything that restricts or limits a consumer's ability to choose is not a good thing in our book.

30 GB (and of course 400 GB) sounds like a lot of downloading and uploading, and it actually is. But it is a lot based upon the way people use their Internet connection today. Although video streaming services are wildly popular, there are still a good deal of people who watch TV through a cable box or using rabbit ears. But as the video streaming moves out of infancy and into teenagerdom, more and more people will be canceling their cable subscription and switching to an online video service. Additionally, more and more cloud-based and streaming services are launching every day, with music services like Grooveshark and Spotify and video telephony services like Fring and FaceTime. The more consumers adopt online services for their media consumption and communication needs, the quicker consumers will use up their bandwidth allowance.

It is our hope that telecommunications companies have the foresight to see that we need to be planning for the future of online services, not just increasing its own quarterly profits. Companies who implement data caps may end up making more money, but it may be at the cost of innovation and adoption of high-bandwidth online technologies.

What do you think about Cox's data allowances? Will you change your consumption habits if you get a warning from Cox that  you exceeded your plan's allowance? Does this make you want to switch from Cox to another Internet Service Provider? Let us know in the comments.