Between 2014 and 2017, thousands of Southern California residents opened their gas bills and discovered they were on the hook for way more money than they expected.
So many of them complained to the California Public Utilities Commission, that the regulatory agency opened an investigation into Southern California Gas Company.
This week, the investigation concluded that SoCal Gas had violated the rights of consumers by delaying bills for more than a month. It also criticized the company for using estimates based on previous usage patterns, instead of actual meter readings.
The company was fined $8 million.
$4.7 million of the fine will be used to compensate some 47,000 gas customers whose bills were delayed 45 or more days. Meaning 47,000 customers will each receive $100 in credit towards their future gas bills.
Starting around 2014, during a period when SoCal Gas was busy swapping out analog meters for digital ones, the company fell behind in their readings. Turnover of staff during that time also hindered the company’s meter-readings.
So the company, which is required under state regulations to bill monthly (billing cycles being 27 to 33 days) began extending the duration of its billing cycles, from 34 to 60 days. It also began estimating the bills for 2015 and 2016 based on usage patterns established in 2014.
Some customers didn’t even get bills for several months. Millions of the company’s bills had irregularities, according to the CPUC decision.
People whose bills arrived over three months late during the winter of 2015-16 will be eligible for $100 in credits. It turns out that if a utility fails to send a bill for several months, and then sends one to catch up on payments, the most it can collect is three months’ worth, said Mindy Spatt, of the consumer advocacy group TURN.
“You can’t just turn to your customers after six or eight months, or however long it was, and say oh by the way you owe us X hundreds of dollars,” Spatt said.
For its part, SoCal Gas says it is reviewing the decision and has not yet decided whether to file an appeal.
“We maintain that our billing practices during the period in question were consistent with our CPUC approved tariffs,” SoCal Gas spokeswoman Christine Detz said in an emailed statement.
The company says it has completed replacing gas meters so it “has all but eliminated estimated bills.”
Read the full CPUC decision here.