HomeMy WebLinkAboutMOIR.txt
1 (The following proceedings were
2 had in open hearing.)
3 COMMISSIONER HANSEN: The exhibits
4 marked 206 through 212 plus 225 identified on the
5 record. If there is no objection, so ordered.
6 (ScottishPower Exhibit Nos. 206
7 through 212 and 225 were marked for identification.)
8 MR. MILLER: And Mr. Moir is available
9 for cross-examination.
10 COMMISSIONER HANSEN: Okay. Let's
11 start with Solutia.
12 MR. BUDGE: No questions.
13 COMMISSIONER HANSEN: Mr. Nye.
14 MR. NYE: No questions.
15 COMMISSIONER HANSEN: Mr. Ward.
16 MR. WARD: No questions, thank you.
17 COMMISSIONER HANSEN: Mr. Richardson.
18 Mr. Richardson, do you have any questions?
19 MR. RICHARDSON: I'm sorry,
20 Mr. Chairman. No questions.
21 COMMISSIONER HANSEN: Staff.
22 Mr. Purdy.
23 MR. PURDY: Just a couple.
24
25
405
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 CROSS-EXAMINATION
2
3 BY MR. PURDY:
4 Q. Now, good morning, Mr. Moir.
5 A. Good morning.
6 Q. Am I to understand that ScottishPower
7 has proposed, through your direct testimony or
8 perhaps direct testimony of another witness,
9 essentially a financial penalty of $1 per customer
10 in the event that the Company does not live up to
11 its commitments with respect to network reliability
12 performance?
13 A. For the first five performance
14 standards, yes.
15 Q. All right. And isn't it also true
16 though that the Company has not made the same
17 penalty proposal with respect to, for instance,
18 telephone service levels and complaint resolution
19 matters?
20 A. That is correct, yes.
21 Q. All right. My question then is why is
22 the Company not willing to -- to commit to the same
23 penalty for those areas of customer service?
24 A. I think a lot of the word the
25 "penalty" is used through testimonies essentially is
406
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 possibly the wrong word, because essentially the
2 entire customer service package, both the guarantees
3 and the performances standards, are really as far as
4 PacifiCorp is concerned in terms of the common
5 performance, they really are stretching goals and
6 stretching targets. However, the Company, when it
7 put together the proposal, recognized that the first
8 five -- these are the reliability standards -- will
9 not materialize fully for the first -- until the
10 first five years. Then under those circumstances,
11 we felt that it was only fair and proper that
12 customers and the Commission itself were able to
13 satisfy itself that these were not indeed false
14 promises by the Company and promises that we would
15 not keep because of the duration and that is the
16 five years.
17 Quite clearly, the other two
18 standards -- the Commission complaints and the
19 telephone answering -- fall into a completely
20 different category, particularly the telephone
21 answering, because the telephone answering, for
22 example, has to be implemented within 120 days of
23 the transaction being signed. That means that the
24 standard, which is 80 percent of calls be answered
25 within 30 seconds, we only have four months to
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HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 achieve that. And immediately customers will see
2 the benefit of that, so there is no false promise
3 aspect associated with that.
4 Within one year later, we take the
5 30 seconds down to 20 seconds, and one year later
6 following that we take it down to ten seconds.
7 The Company believes and I certainly
8 believe that -- that a stretch target from common
9 performance down to ten seconds would be undoubtedly
10 a US best in class, and customers will see that and
11 we don't think that -- that such a stretching target
12 should be the target of penalties.
13 Q. Well, I can appreciate the time frame
14 considerations that you discuss, but wouldn't you
15 agree with me that PacifiCorp has had a history of
16 relatively high billing-related calls and customer
17 complaints?
18 A. Yes.
19 Q. In fact, I believe in your rebuttal
20 testimony, you indicated that there were, on the
21 average, about 870,000 billing-related calls
22 received by the Company each year. Correct?
23 A. That is correct, and that is something
24 that ScottishPower will be addressing
25 posttransaction.
408
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Q. All right. Would you consider that a
2 fairly significant problem with respect to customer
3 service?
4 A. I would, yes.
5 Q. All right. And do you agree that --
6 well, I think your testimony was that of those, of
7 the 870,000 billing-related calls, 62,000 calls
8 required some type of follow-up work by the
9 Company. Correct?
10 A. That's correct, yes.
11 Q. And you would agree that that's a
12 fairly significant percentage, would you not?
13 A. I would indeed.
14 Q. Have you, in preparing for this merger
15 and I assume in the work that you've done in
16 reviewing PacifiCorp's operations and their records,
17 have you been able to identify or fashion any
18 remedies for reducing or eliminating some of the
19 costs of this high number of complaints?
20 A. Yeah, I think what we have to
21 recognize here is that my testimony relates to the
22 promises and guarantees and commitments that
23 ScottishPower is specifically making and entering
24 into the public domain. Quite clearly, beyond
25 that -- that's really only the tip of the iceberg.
409
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Beyond that, ScottishPower and PacifiCorp as a
2 muddied couple, if you like, will really have to get
3 into the nitty-gritty and the organization and the
4 structure, the processes, the working practices to
5 improve all of its activities. And my experience --
6 and I've been here now since mid-January -- is that
7 there is significant amount of work to be done in
8 the business centers, A, to achieve what we've said
9 what we would do in terms of telephone answering and
10 so on, but secondly, some of the working practices
11 that traditionally have allowed that kind of backlog
12 of complaints and inquiries, et cetera, to develop.
13 Q. So in that answer, have you -- are you
14 telling me that you've come up with some type of
15 remedy or you intend to begin working on that at
16 some point in the future?
17 A. I'm telling you that at this stage, we
18 have not come up with a remedy.
19 Q. When do you expect to do that?
20 A. Part of that will be transition
21 planning, part of it will be operational planning
22 carried out by a mixture of PacifiCorp and
23 ScottishPower experts; and I would guess
24 posttransaction you're talking about within the
25 first six months.
410
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Q. You said -- did you tell me you've
2 been here since January? Do you mean here in the
3 United States?
4 A. I mean here in the United States.
5 Q. How long have you been with
6 ScottishPower?
7 A. A long time. Thirty-two years.
8 Q. Fairly experienced in the area of
9 customer service, are you not?
10 A. Both customer conservation and
11 engineering, yes, and general management.
12 Q. Now, I believe that you indicated in
13 your rebuttal testimony that the follow-up work, the
14 62,000 phone calls that require follow-up work,
15 typically take more than ten business days to
16 complete, equates to about two weeks in real time.
17 Do you consider that to be a fairly slow turnaround
18 time?
19 A. I would consider it to be acceptable
20 if the 62,000 was 2- or 300. Because the 62,000 is
21 such -- is of such magnitude, I would say the
22 overall performance in that context is unacceptable.
23 Q. So you think it's because of the sheer
24 volume that's requiring the Company to take nearly
25 two weeks to follow up on the customer complaint?
411
HEDRICK COURT REPORTING MOIR (X)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 A. Yes.
2 Q. Okay. Thank you very much.
3 COMMISSIONER HANSEN: Let's see if we
4 have any questions from the Commission. I have
5 none.
6 Do we have any redirect?
7 MR. MILLER: Yes. Just a couple,
8 Mr. Chairman.
9
10 REDIRECT EXAMINATION
11
12 BY MR. MILLER:
13 Q. Mr. Moir, were you in the hearing room
14 yesterday?
15 A. I was, yes.
16 Q. Mr. Richardson testified yesterday.
17 Were you here for his testimony?
18 A. I was indeed, yes.
19 Q. As I recall, Mr. Richardson testified,
20 among other things, that one value of the customer
21 payments from a management point of view is that if
22 management discovers payments are being made, it's
23 necessary to make payments, that management is, in
24 effect, receiving information that there is a
25 problem that needs to be addressed. Is that right?
412
HEDRICK COURT REPORTING MOIR (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 A. That is absolutely correct, yes.
2 Q. So one of the values of the payment
3 proposals is as a not so much a -- an addition to a
4 customer benefit, it also is providing information
5 to management on what needs to be done in the
6 operation of the business?
7 A. I would submit that is the main value
8 of the customer service and performance standards
9 proposal and package from the point of view that
10 because every aspect of our activities and in terms
11 of guarantees and performance standards is now being
12 measured, everyone is aware of them, from CEO down,
13 right down to a meter man who knocks on a door,
14 makes an appointment, keeps appointment, et cetera.
15 So the whole culture of the organization.
16 And you know, you mentioned how long
17 I've been in the organization. I've seen
18 ScottishPower or State of Scotland Electricity Board
19 transformed from an organization of relative
20 sloppiness mixed with I think complacency, into one
21 which is now target-driven, objective-driven, right
22 through the organization. There's almost a paranoia
23 about performance -- about measuring performance,
24 about reporting performance -- and making sure that
25 everybody in the organization is aware of it.
413
HEDRICK COURT REPORTING MOIR (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 That's a situation I would have to say I have not
2 found in the last six months of my operation in the
3 US, and as far as PacifiCorp is concerned,
4 particularly the reporting aspect of performance.
5 And there is such grave inaccuracy in reporting that
6 it is something that ScottishPower will address
7 immediately on transaction.
8 An example of that was yesterday when
9 Mr. Richardson was asked about a number of outages
10 that go beyond 24 hours. Now, in the absence of the
11 data in front of him, quite rightly he answered in a
12 way which would suggest that there was only five
13 outages beyond 24 hours in Idaho, and that would be
14 the type of situation possibly you would get in the
15 UK. What I found is that it's at least 70 percent
16 of outages are not reported at all in PacifiCorp,
17 which makes the outage reporting system, the
18 accuracy of it, questionable, to say the least. So
19 any figures and any data that's presented in terms
20 of outages, for example, you just have to disregard.
21 And as I said earlier, one of the first things that
22 ScottishPower to do -- has to do is to get the
23 reporting systems in place.
24 Q. So this payment scheme or proposal is
25 related to standards that will be implemented over a
414
HEDRICK COURT REPORTING MOIR (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 long period of time. Is that correct? Not a long
2 period of time, but a substantial period of time?
3 A. Which payment scheme? I'm sorry.
4 Q. The Company's --
5 A. The penalties for the first five?
6 Q. Right?
7 A. Yes, over a five-year period.
8 Q. And when viewed from a management
9 information perspective, does management need any
10 information to know that telephone answering needs
11 to be improved?
12 A. Does it need information?
13 Q. Does it need the type of information
14 that is conveyed by payments?
15 MR. NYE: Objection. Beyond the scope
16 of cross.
17 COMMISSIONER HANSEN: Mr. Miller.
18 MR. MILLER: That's a very good
19 objection: Should be sustained.
20 (Laughter.)
21 COMMISSIONER HANSEN: That makes it
22 easy on the Chair. Objection sustained.
23 THE WITNESS: I'm rather glad because
24 I didn't know the answer.
25 MR. MILLER: No further questions,
415
HEDRICK COURT REPORTING MOIR (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Mr. Chairman. Thank you.
2 COMMISSIONER HANSEN: Okay. Well,
3 thank you very much, Mr. Moir.
4 THE WITNESS: I appreciate it.
5 (The witness left the stand.)
6 COMMISSIONER HANSEN: Move to the next
7 witness.
8 MR. MILLER: Next witness will be
9 Robin MacLaren.
10 And I wonder if I could have the
11 indulgence of the Commission to just have like two
12 minutes to make a couple of photocopies that I
13 forgot to make.
14 COMMISSIONER HANSEN: That would be
15 fine. Go at ease.
16 (Recess.)
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416
HEDRICK COURT REPORTING MOIR (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 ROBIN MacLAREN,
2 produced as a witness at the instance of
3 ScottishPower, being first duly sworn, was examined
4 and testified as follows:
5
6 DIRECT EXAMINATION
7
8 BY MR. MILLER:
9 Q. Sir, would you state your name,
10 please?
11 A. My name is Robin MacLaren.
12 Q. And what is your business address?
13 A. My current business address is
14 Suite 900, 500 Northeast Multnomah Street, Portland.
15 Q. By whom are you employed?
16 A. I am employed by ScottishPower.
17 Q. What is your position with
18 ScottishPower?
19 A. I have been chief engineer of power
20 systems in Scotland which cover both the
21 transmission and distribution networks in Scotland
22 and the -- covers the distribution network in
23 Manweb. I have now moved to Portland to work on the
24 PacifiCorp -- on the PacifiCorp merger and would
25 expect to stay within the US after completion.
417
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Q. In general, what are your current
2 duties and responsibilities?
3 A. My current duties in my capacity in
4 Portland are to technical issues and to support
5 generally on the merger team. Before coming across
6 here I was responsible for running power systems
7 which following on from Alan Richardson's across
8 here which was managing all generality of the
9 networks in the UK and the associated operational
10 and design staff.
11 Q. Very good. Did you previously have
12 occasion in this proceeding to prefile certain
13 written rebuttal testimony consisting of six pages?
14 A. I did.
15 Q. Were there any exhibits attached to
16 your testimony?
17 A. Not to that testimony.
18 Q. Okay. Do you need to make any
19 additions or corrections to your prefiled written
20 testimony?
21 A. I do not.
22 Q. If I asked you the questions today
23 that are set forth in your testimony, would your
24 answers be the same?
25 A. They would be.
418
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Q. Is your testimony true and correct to
2 the best of your knowledge?
3 A. It is.
4 MR. MILLER: Mr. Chairman, I'm going
5 to ask now a couple of questions, if I might,
6 relating to Exhibit 226 which has been marked and
7 distributed.
8 Q. BY MR. MILLER: Mr. MacLaren, do you
9 have in front of you what's been marked as
10 Exhibit 226?
11 A. I do.
12 Q. To your knowledge, was this exhibit
13 previously distributed to all of the parties?
14 A. I believe it has been distributed.
15 Q. Now, in his direct testimony,
16 Mr. Sterling expresses a concern about the
17 possibility that network reliability might drop
18 below the baseline levels that will be established.
19 Is Exhibit 223 -- 226 -- intended to respond to that
20 concern?
21 A. It is a -- we clarified the intent of
22 the testimony and put forward this exhibit to put in
23 a place a process that ensures that any
24 deterioration in the system performance -- though I
25 personally think that to be unlikely -- is addressed
419
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 and puts a process in place to work with Staff to
2 rectify that and ultimately puts the power in the
3 hands of the Commission to ensure that no
4 deterioration does take place and that ScottishPower
5 will carry out the necessary work to make sure that
6 the system performance is at least as good as it
7 currently is; although as I said, I would expect to
8 see performance improvement, and that is what we are
9 committing to in our testimony.
10 Q. Our witnesses have expressed a general
11 concern that in some way the Eastern Idaho service
12 territory might be neglected or left behind. Is
13 this proposal also designed to respond to that
14 concern?
15 A. Yes. It underpins our intent in our
16 rate testimony to introduce performance standards
17 for improvement, but this proposal will make sure
18 that there is no deterioration in Eastern Idaho.
19 Q. In fact, is this proposal unique to
20 Idaho; that is, has something like this been
21 proposed?
22 A. It is. We have set up a process here
23 to work closely with Staff to make sure that these
24 concerns would be addressed and we're putting this
25 proposal forward here for consideration.
420
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 Q. And just in general terms, without
2 reading through the entire thing, could you describe
3 for the Commissioners the process that's summarized
4 in the exhibit?
5 A. Yes. We propose to set up a
6 performance review committee with PUC Staff. One of
7 the first tasks will be to establish the base lines
8 based on the information that we have at the moment.
9 That committee will continually review performance
10 in Idaho, putting -- it meets twice -- twice a
11 year -- and that should be I hope monitoring
12 improvements that we make within network. However,
13 if the performance is to deteriorate or
14 deteriorates, then that will provide a forum where
15 we will put forward our proposals for remediation.
16 If the remediation does not happen, then the -- a
17 committee will then move forward to get an
18 independent assessment of why that performance has
19 deteriorated.
20 In conjunction with that,
21 ScottishPower will take steps to improve the
22 performance, but ultimately what that allows -- the
23 process allows the -- a referral of the matter to
24 the Commission. And we accept in this case that
25 the -- where the issues are remediation measures to
421
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 restore reliability, the expenditure required for
2 remediation and the cost responsibility, that these
3 would be put forward to the Commission, and we would
4 accept the Commission's decision on that.
5 Q. Is it your opinion that the process
6 proposed here creates a procedure and a process that
7 will have the effect of assuring that Idaho
8 customers suffer no harm as a result of a
9 deterioration in network performance or
10 reliability?
11 MR. BUDGE: Mr. Chairman, I'd like to
12 interpose an objection here, in that we have some
13 clarification of where we're going. It appears
14 we've gone way beyond merely introducing a new
15 exhibit into new direct testimony through this
16 witness that's going beyond the scope of his
17 rebuttal testimony and essentially appears to be
18 redirect coming before we even cross-examine. I
19 just think we're really out of line here; we've been
20 quite liberal on withholding objection.
21 One other matter, and I apologize, but
22 I'm not sure, when was this exhibit spread around?
23 Was this today or yesterday? I don't have that
24 exhibit. I may have misplaced it.
25 MR. MILLER: Mr. Chairman, it was
422
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 distributed to all the parties by mail with a cover
2 letter that I can get from my office last week.
3 And that was the last question that I
4 had anyway, Mr. Chairman, so if he could answer that
5 question.
6 MR. BUDGE: That would be sufficient.
7 COMMISSIONER HANSEN: Okay. Okay,
8 then, Mr. Budge, you said --
9 MR. BUDGE: This is as far as we're
10 going to go.
11 COMMISSIONER HANSEN: -- beyond your
12 objection then, the answer --
13 This is the last question. Is that
14 correct?
15 MR. BUDGE: Yes.
16 COMMISSIONER HANSEN: Okay. This will
17 be the last question.
18 THE WITNESS: Could you repeat the
19 question, please?
20 Q. BY MR. MILLER: The question may be
21 different than what I originally asked, but I'll
22 try.
23 Is it your opinion that the process
24 proposed here provides an assurance that Idaho
25 customers will not suffer harm due to a decline in
423
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower
1 network performance and reliability?
2 A. Yes, I believe that to be the case,
3 that we are providing a very substantial and robust
4 process to ensure that does not happen, with the
5 ultimate power lying with the Commission as
6 representatives of the customers.
7 Q. Very good.
8 MR. MILLER: With that, Mr. Chairman,
9 the witness is available for cross-examination.
10 COMMISSIONER HANSEN: Mr. Miller, I
11 don't believe we spread his testimony on the record,
12 or the exhibit either.
13 MR. MILLER: Mr. Chairman, if there is
14 no objection, we would ask that the rebuttal
15 testimony of the witness be spread on the record as
16 if read, and that Exhibit No. 226 be marked.
17 COMMISSIONER HANSEN: Okay. Is there
18 any objection to testimony being -- rebuttal
19 testimony being spread upon the record? Being none,
20 so ordered.
21 (The following prefiled rebuttal
22 testimony of Mr. MacLaren is spread upon the
23 record.)
24
25
424
HEDRICK COURT REPORTING MacLAREN (Di)
P.O. BOX 578, BOISE, ID 83701 ScottishPower