The woes of Philadelphia’s main gas utility, Philadelphia GasWorks (PGW), have grown to embarrassing levels as computer systemproblems, debt, and customer unhappiness continue to dominate thescene. The situation came to a head last week, as the hierarchy ofPGW testified before the Philadelphia Gas Commission during publichearings of the utility’s budget process.

During the hearings, which lasted from Wednesday to Friday, theutility proposed a strategic five-year plan that includes staffreductions of about 300 managerial positions over that span as wellas an overall budget cut of $42 million for 2000.

“We know we have a lot of work to do to make [PGW] a healthyoperation,” executive vice president Gregory Martin said. “If wewere doing it again, there’s a lot of things we would have donedifferently.”

The poor state of PGW was put in focus during the hearings. Ithas $800 million in debt, and Chris Kimmerle, executive directorfor the Commission, said that debt is “headed for $1 billion fast,”he said.

One way for PGW to cut its debt would be to collect on its gasbills, but due to a combination of problems with PGW’s new $70million computer system, even that has become a chore. “There havebeen significant problems in implementing the new customer servicesystem,” Kimmerle said. “Nobody knows how many people wereover-billed or by how much. There is a staff of eight here in myoffice. One person definitely had a miscalculation on his bill, andthere are a couple of other suspect ones.” He added that theproblems are a combination of software trouble, staff training andperson power.

Yet billing is not the only area affected by the computerproblems, according to Kimmerle. “On a good day, PGW answers 30% ofits customer service calls.” Efforts are ongoing to fix theseproblem, PGW said.

Pennsylvania has not turned a blind eye to this problem. When thestate legislature passed its comprehensive deregulation bill earlierthis summer (See Daily GPI, June 23,1999), it included a section requiring PGW to be regulated by thestate’s Public Utilities Commission. The city, however, may behesitant to let the state have any control over the municipalutility. “No papers have been filed anywhere, but issues are beingreviewed,” Kimmerle said.

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