When ConEdison estimates electric bills, low-income neighborhoods lose
Through our financial coaching programs with New Yorkers, the Finesse team has continued to discover how companies like ConEdison have unfairly designed their pricing and service models for everyday Americans.
Recently, we called ConEd on behalf of one of our clients to understand an unusually high bill. Our client, Randi*, is both a both a working mother and the head of a large household — with a lot of bills. Over the course of the past three months, Randi’s energy bills were $200 in June, $350 in July, and $250 in August.
Over the course of the past three months, Randi’s energy bills were $200 in June, $350 in July, and $250 in August. The extra $150 charged in July broke her budget right before she had to go back to school shopping for her son.
What was baffling to us?
- August was a hotter month than July. In fact, average temperatures for that area, per month, were listed on the bill. If AC costs are the primary driver for higher bills in the summer, why was July so much higher than August?
- Her July bill was marked as “an estimated reading.” This meant that only the numbers from the June and August electricity bills had been taken from an actual meter reading.
- When we called ConEd’s customer service, we were told that in much of the Bronx, smart auto-reporting meters hadn’t been installed yet.
They told us that in that neighborhood it wasn’t financially feasible to send a meter reader out every month to accurately determine how much should be charged, so they use an algorithm to determine what the estimated reading would be for that month.
In neighborhoods, we learned that while ConEd has either been able to (1) install smart meters which can send energy consumption readings automatically or (2) send meter readers out on a monthly basis, ConEd only sends out meter readers once every two months to this neighborhood. They also claimed that upon the next meter reading, any overcharges for the previous month would be refunded. (It’s currently in the process of rolling out full smart meter coverage across NYC.)
Unfortunately, we weren’t able to get ConEd to send out another meter reader, or for the bill to be refunded. We were, however, able to help Randi negotiate an installation payment plan for the high charge.
We legitimately believe that ConEd is not intending to overcharge families like Randi’s. We do believe that as a large utility with a monopoly, its resources, processes, and priorities have evolved over time to overlook the impact of inaccurate pricing on the financial wellbeing of its low-and-middle-income customers.
Coned does a lot of good for consumers in NYC. But companies that have been given monopoly markets — utilities, telecoms — by our democracy have a special obligation: to give fair service to all customers, and especially to those who may be disproportionately harmed by its business practices.
We suspect if Coned’s customer service team tallied up the costs of serving customers with bill bill disputes, they’d be able to make a strong business case for two two customer-centric practices: (1) expediting the rate of smart meter installations in the Bronx, which experiences the highest household poverty rate among the five boroughs, and (2) improving the readability and understandability of its billing web dashboard and paper forms. (We spent ~70 minutes on the phone with two ConEd reps.)
We believe that building simple ways for your customers to understand why and how you’re charging them is not only right, but also pays off for your bottom line.
- Thank you you to Randi — name changed — for allowing us to tell her story and for helping us build Finesse, the world’s best digital financial coach that empowers everyday folks to achieve their biggest financial goals. Sign up here to join our waitlist.
