UPDATE: July 1, 5:25 p.m.
The Public Utility Commission has approved a refund for 270,000 Philadelphia Gas Works customers who were charged abnormally high fees on their May bills. With the PUC's permission, it will refund the charges as a credit on July or August bills.
PUC Chair Gladys Brown Dutrieuille signed an emergency order allowing the refund. The full PUC will consider the Order at its July 14 meeting. It can vote to ratify, rescind or modify the order.
The original story follows
PHILADELPHIA (KYW Newsradio) — Philadelphia Gas Works says it plans to refund enormous extra charges that were tacked on to 270,000 customers' bills for May, after customers made numerous complaints to the company and state regulators. The company says the fees were not a mistake.
The Public Utility Commission and the Pennsylvania Office of Consumer Advocate both report receiving an unusual number of complaints about May bills from PGW. The consumer advocate says he is launching an investigation.
PGW declined an interview request but sent a statement from CEO Seth Shapiro, which attributed the charges to a long-used formula for stabilizing bills known as the "weather normalization adjustment."
This typically generates fees of a few cents to a few dollars. However, customers like Anne Marie Muldoon suddenly saw hundreds of dollars added to their bills.
Muldoon, who runs a small chiropractic office in Northeast Philadelphia, said her gas bill in the spring is typically around $50 per month. On Monday, she received a bill from PGW for more than $1,000.
"I thought, 'This had to be a mistake," she said.
However, when she called PGW, a representative said the bill included an $800 weather normalization charge.
"So we went back through a year's worth of bills — and that charge is on there, but it's anywhere from zero to 50-, 60 cents," Muldoon said.
PGW customer Caroline Kapka says she also saw hundreds of dollars added to her bills.
"I was very angry," she said.
Kapka filed a complaint, but PGW said there was nothing they could do.
It would appear that something went terribly wrong with the weather normalization calculation, but Shapiro said, in the PGW statement, that "the equation performed as designed," with no explanation of why May's charges were so far out of line with previous billing cycles.
The utility says the fees were so high because it was a warm May. The average temperature in May 2022 was three degrees higher than in May 2021 — but it was cooler than in May of 2015.
PGW's explanation doesn't sound right to City Councilmember Derek Green, who is on the Philadelphia Gas Commission. He says he will use upcoming budget hearings to get clarity.
"I hope that will shed some sunlight on why this anomaly occurred and make sure this does not happen going forward," he said.
Shapiro has acknowledged that the result "is not what is intended and is unfair to our customers," and PGW has asked the PUC if it can provide a refund as a credit on July or August bills. A PUC official declined to comment on the request but said PGW can refund money to customers on its own.
Green estimates refunds will total $12 million.
