Retail Supplier Seeks Initial Decision Against Utility Over Alleged Continuation Of Billing Errors

March 21, 2023

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Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

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Agway Energy Services, LLC ('Agway') filed at the New York PSC a request for an Initial Decision with respect to its formal dispute with Central Hudson Gas and Electric Corporation concerning the provision of accurate billing data

Joe Jenkins, Director of Media Relations for Central Hudson Gas and Electric Corporation, provided the following statement concerning the matter:

"Central Hudson is reviewing Agway’s filing and will respond in due course. Central Hudson has resolved many issues associated with the transition to its new billing system. Customers -- including Agway -- are receiving improved billing services. Central Hudson continues to improve service to meet the standards expected by its customers and to meet our own standards as well."

--- Statement from Joe Jenkins, Director of Media Relations for Central Hudson Gas and Electric Corporation

As previously reported, Agway initiated the Formal Dispute Resolution process on May 23, 2022 in accordance with Uniform Business Practices ('UBP') § 8(B)(1) to address Central Hudson’s systemwide failure to exchange billing information with Agway.

Agway alleged, "The errors, which include incomplete, inaccurate, and mis-formatted Electronic Data Interchange records, have wreaked havoc with Agway’s customer files and financial records."

See more background on the billing issues here

As previously reported, the PSC has also separately initiated an investigation of Central Hudson billing issues, not specific to ESCO matters

Agway alleged in its March 21 motion, "Central Hudson filed its response in this matter on June 2, 2022, and the parties participated in a meeting on June 16, 2022 in accordance with UBP § 8(B)(1)(b). Agway and Central Hudson scheduled weekly meetings thereafter in order to see if a resolution could be reached. To date, Agway has made enormous efforts to work with Central Hudson, meeting with its personnel over thirty (30) times between June 2022 and February 2023. Unfortunately, no resolution has been reached, and the same problems that began in September 2021 continue to this day."

Agway alleged, "as reflected by the fact that Central Hudson is still unable to prevent continuing errors, let alone correct all prior errors, it has become painfully clear that this will not end for years if things are left solely in Central Hudson’s control."

"Agway therefore respectfully requests the relief sought in this matter, which includes (a) the retention of an outside expert to audit and remedy the systemic errors, and (b) oversight by the Commission. Transparency and oversight are desperately needed," Agway said

"Pursuant to UBP § 8(B)(1)(c), a party may request an initial decision from the Department of Public Service '[i]f no mutually acceptable resolution is reached within 40 calendar days after receipt of the written description of the dispute.' It has now been nearly 300 days, and no acceptable resolution has been reached. The systemwide problems continue to harm Agway’s business as well as its customers," Agway said

Agway alleged the outstanding issues can be divided into two categories: (A) Central Hudson’s alleged failure to resolve ongoing EDI errors, and (B) Central Hudson’s alleged failure to correct historical EDI data.

"With respect to ongoing errors, the fundamental cause is the inability of Central Hudson’s new system to generate correct EDI. This has forced Central Hudson to manually create EDI transactions, but those have routinely contained errors as well," Agway alleged

Agway alleged, "Agway has identified over 1,000 such examples since September 2021. These errors are still occurring today."

Agway alleged, "With respect to historical data, there have been literally thousands of EDI transactions containing errors that have impacted Agway’s sales, sales tax, and accounts receivable. It is unknown to what extent these errors have shown up on customer invoices. Central Hudson has failed to correct errors on multiple accounts -- which it can only manually -- and the problem grows every time new erroneous EDI is generated."

Agway alleged, "Central Hudson has represented that it can only address cleanup manually and that doing so would be an enormously time-consuming process. When Central Hudson attempted to address some historical errors, it managed to create more errors, causing additional problems on Agway’s end. Meanwhile, approximately half of the EDI 820 payment transactions sent by Central Hudson since October 2021 have been incorrect, with header totals differing from the sums of the detail transactions, resulting in erroneous cash and A/R balances on Agway’s financial records. Agway, in an attempt to make corrections that Central Hudson had not successfully made, obtained spreadsheets from Central Hudson setting forth the data underlying the header totals, which represented the POR cash payments. Agway spent hours reconciling that data with Central Hudson’s EDI 820 detail transactions."

Agway alleged, "The foregoing problems have resulted in multiple categories of ongoing harm to Agway. (Garofalo Aff., Section C). Because Central Hudson is still billing customers incorrect amounts, some customers are undercharged, to Agway’s detriment, while others are overcharged, to the customers’ detriment. The latter could well have led to cancellations by customers who believed the billings problems were caused by Agway and not Central Hudson. Additionally, Central Hudson is failing to apply correct tax charges, which causes Agway to pay those taxes without compensation. Agway also incurs other accounting losses because its general ledger is not posted when certain transactions lack the required matching EDI."

Agway alleged, "The impact of the above problems on Agway’s business cannot be overstated. In order to properly serve its customers, Agway has been constrained to add substantial resources and redirect its staff from critical roles to keep up with Central Hudson’s problems."

"The financial errors range from one cent to very large amounts. There are instances where Agway's customers pay less than Agway's cost to purchase the energy," Agway alleged

Agway alleged, "One Agway customer has had at least nine invoices with unit rates incorrectly set too low, resulting in understated sales and AIR on Agway's books. Although Central Hudson initially characterized this customer as an isolated situation, five more customers were found to be affected, three of which are no longer Agway's customers. Central Hudson sent corrections to Agway for all of them, resulting in more data errors."

Agway alleged, "Other customers are overcharged, which Agway strongly believes led to cancellations by a number of customers who believed the billings problems were caused by Agway and not Central Hudson."

Agway alleged, "The relief sought by Agway is directed at increasing transparency and oversight. Right now, Central Hudson has exclusive possession and control of data required to solve the problems and has withheld that data. (Garofalo Aff., Section D). Agway asked Central Hudson to provide copies of the bills that were sent to Agway’s customers. The purpose of this request was to confirm that the amounts Central Hudson has actually charged Agway’s customers is the same amount that Central Hudson has claimed in its EDI records was charged."

Agway alleged, "Central Hudson has refused to provide these bills, dubiously asserting that it cannot share them due to 'confidentiality.' However, Agway is asking only for bills for its own customers. Because these customers already enrolled with Agway, they have already provided Agway with their names, addresses, utility account number, and usage. Agway is not asking for bills for customers serviced by other ESCOs or that were still on incumbent utility service. Simply put, Central Hudson should not be able to conceal to what extent Agway’s and other ESCOs’ customers were overbilled, to what extent ESCOs were underpaid, and to what extent Agway’s and other ESCOs’ customers were given incorrect information or erroneously dropped from their supplier, perhaps as erroneously identified as on the ineligible list."

Agway alleged, "In its submissions here and in other matters, Central Hudson has repeatedly insisted that it already corrected the underlying problems [sic] It obviously has not."

In a January 2023 response to an earlier January 2023 Agway filing, in which Agway further alleged errors with respect to bill accuracy, Electronic Data Interface ('EDI') issues and Purchase of Receivables ('POR') accuracy, Central Hudson Gas & Electric Corporation (Central Hudson) had said, "Rather than bring these issues to Central Hudson so that the issues can be discussed, and any misunderstandings resolved, Agway chose to submit its [January 24, 2023] letter with no notice to Central Hudson."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "Agway incorrectly alleges that Central Hudson has not shown that Agway’s customers have been accurately billed. Agway has asked for Central Hudson’s help to verify billing accuracy because due to prior EDI issues, now mostly resolved, Agway could not verify billing accuracy for some of its customers through its customer information system."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "Central Hudson agreed to provide a spreadsheet that would align customer bills to allow Agway to verify accuracy. Agway provided a sample of ten of its customers so that Central Hudson could provide a preliminary spreadsheet allowing Agway to confirm to Central Hudson the usefulness of the spreadsheet before Central Hudson prepares a similar spreadsheet covering the full set of customers requested by Agway."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "Central Hudson tested the data against the list of ten customers provided by Agway and the data shows that the bills issued to Agway’s customers are accurate. Agway has insisted that the spreadsheet does not demonstrate the accuracy of customers’ bills even though the data matches the information on customer’s bills. The reason for Agway’s statement is its assertion that the spreadsheet does not align with the original EDI data. Of course, the spreadsheet data does not match the original EDI data because the original EDI data, for a variety of reasons, did not match customers’ bills. The spreadsheet data must align with customers’ bills to verify accuracy, and it does."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "Central Hudson has presented the facts -- the issue is that it appears that Agway doesn’t understand the facts. Central Hudson has addressed all ten customers referenced by Agway and is willing to provide Agway with a spreadsheet confirming the billing accuracy to its remaining customers. Central Hudson is also again willing to walk Agway through the sample spreadsheet. Once Agway understands the spreadsheet, Central Hudson may produce the same information for all of Agway’s remaining customers. To date, Central Hudson has resolved billing or EDI issues for more than 305 Agway accounts for which Agway has asked for assistance."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "POR payments are based on customers’ bills. Agway does not allege that Central Hudson has failed to make POR payments, because Central Hudson has paid POR to Agway and all other ESCOs. Central Hudson has provided Agway, and other ESCOs, with a spreadsheet allowing ESCO verification of the POR payments. For Agway, Central Hudson has also developed a spreadsheet to verify customer billing. Because customer bills form the basis for the POR payment, if Agway asks for the customer accuracy spreadsheet for its customers that spreadsheet should confirm the POR spreadsheet for the same billing period. The POR calculation includes adjustments for backbills. Central Hudson has no reason to believe that its POR payments are inaccurate, and Agway has not presented any facts to demonstrate that POR payments are inaccurate."

In a January 2023 response to an earlier January 2023 Agway filing, Central Hudson had alleged, "Central Hudson has diligently worked with Agway in good faith, and it will continue to work in good faith with Agway to resolve its issues. As part of that process Agway has a responsibility to have the expertise and technical ability to understand and process information, just as it did under the legacy CIS system. Agway does not help customers or itself when it makes baseless allegations that are demonstrably inaccurate. The Commission should not give any weight to Agway’s inaccurate comments."

Case 22-E-0121

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