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Gayatri Schilberg
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Gayatri M. Schilberg
Senior Economist (Retired)

We are sad to report that Gayatri Schilberg died at the end of December 2015 from cancer. Gayatri retired from consumer advocacy work at JBS Energy. All of her associates miss her calm presence.

Summary of an Illustrious Career

Gayatri Schilberg had a unique career of service to consumers, to the environment and to the public interest as a whole over a 27 year period.

 

She came to JBS Energy in 1987.  Her first assignments were related to utility resource planning, avoided costs of Hawaiian Island utilities, and electric demand forecasting.  She developed considerable expertise on the valuation of environmental externalities, testifying at the California Energy Commission in several electricity reports and before the Ontario Energy Board. 

 

She was heavily involved, along with virtually all of JBS, in the most massive project JBS ever did in its 30-year history – the review of Ontario Hydro’s Demand/Supply plan for the Independent Power Producers’ Society of Ontario.   She also was a member of teams preparing two other major JBS reports with far-reaching consequences – the economic analysis supporting the South Coast Air Quality Management District’s Rule 1135 on powerplant emissions of nitrogen oxides, and the Photovoltaic Regulatory and Policy Issues report prepared in 1995-96 for the National Association of State Utility Consumer Advocates.

 

Her consumer advocacy work began with the Pacific Bell Late Payment Charge case for TURN in 1992, where PacBell did not open mail, charged erroneous late charges, and disconnected customers who had actually paid their bills.  She developed better estimates than Pacific Bell of the amount of erroneous charges and wound up being one of the few people who ever caused a utility to bring in a new expert witness to rebut not only Gayatri’s work but the entire direct case filed by the utility's original expert.

 

From this start, she developed expertise in a number of critically important areas of utility operation in the areas of distribution, customer service and information technology.

 

She was involved in a number of projects related to the measurement and analysis of customer service.  She designed customer service programs and evaluated problems related to several California utilities as well as Texas, Maryland, Nevada, and Alberta.  She adopted the position (originated in the UK) that paying individual customers was the right remedy for many customer service errors.  She also consistently claimed that objective indicators of performance were better than subjective surveys.  Her views in this area were borne out when Southern California Edison committed fraud with consumer surveys to increase its shareholder rewards under Performance-Based Ratemaking, and Gayatri was there to figure out the extent of the fraud. 

 

She also became expert in the arcane issues involved with the measurement of utility reliability as used in shareholder incentive programs and as justification of capital projects. 

 

She also worked on customer service issues for one of JBS’ rare utility clients, preparing a study for Scottish Power compiling service quality practices across the U.S. in support of that company’s proposal for service guarantees offered to regulators as part of its acquisition of Pacificorp.

 

She also was involved in Information Technology projects including a detailed review of the PG&E Customer Information System (rebuilt three times from 1990-2003 – just like Diablo Canyon).  She developed the analytical concept of the “IT treadmill” where utilities would incur ever-increasing expenses for short-lived computer systems if they did not engage in prioritization, cost discipline, and buying more off-the-shelf products.

 

She became an expert in analyzing utility tree trimming practices, testifying in a number of rate cases and in the 1998 trial leading to the conviction of PG&E in Nevada County on charges including criminal negligence for a decade of inadequate tree trimming spending.

 

She also was analyzed utility storm and emergency response and served on a working group at the PUC to develop emergency standards and inspection and maintenance standards for California electric utilities.  She also represented consumers on a committee of the California Independent System Operator on reliability issues.

 

Her testimony demonstrated that Southern California Edison’s deferred pole inspections for more than a decade contributed to its need to replace large numbers of poles.  While the remedy that she proposed, was not adopted, the Commission found Edison at fault for causing some of its pole replacements by not doing timely inspections.

 

Gayatri also testified on a number of other distribution operational issues including the development of holistic and comprehensive estimates of underground cable replacement needs, the assignment of greater amounts of pole replacement costs to communications companies, and means of better quantify the costs that utilities would actually require for pole replacement.  Her last work before her retirement was a comprehensive analysis of Southern California Edison’s multi-billion-dollar replacement program for overloaded and high-wind area poles.

 

Gayatri left consumers and others with the legacy of an amazing body of work as a consummate economist and systems analyst during her time with JBS.

 

Qualifications

Gayatri Schilberg is a Senior Economist and expert witness with over twenty-seven years of experience in economic and statistical research and business applications.  She has concentrated on utility issues for the last twenty years.

 

Ms. Schilberg has three degrees in economics: a B.A. from Oberlin College (1968), an M.A. from the University of Wisconsin (1969), and an M.Phil. from Oxford University (1973).

 

In July, 1987, Ms. Schilberg joined JBS Energy as a Senior Economist, where she is an expert on quantification of energy savings to demand response programs, customer service for both energy and telecommunications utilities, utility revenue requirements for tree trimming and distribution maintenance, economic analysis of the value of reliability for utility planning, and quantification and modeling of energy and environmental issues.

 

Ms. Schilberg has testified at the California Public Utilities Commission (CPUC) on many occasions on utility customer service and operational issues, quantification of demand response, customer service and reliability issues in Performance-Based Ratemaking (PBR), emergency response and emergency standards; tree trimming, deferred pole maintenance and other distribution expenses; costs of PG&E’s customer information system; medical baseline; meter reading practices; and erroneous late payment charges. 

 

She presented testimony before the Public Utilities Commission of Nevada on several occasions regarding PBR service quality mechanisms.  Ms. Schilberg testified before the Alberta Energy and Utilities Board on service quality as well as customer harm from sale of the retail utility functions.  She testified at the Nevada County (California) Municipal Court on PG&E's spending on tree trimming.  She has also testified at the California Energy Commission (CEC) and the Ontario Energy Board on valuation of environmental externalities; and at the CEC on demand forecasts and in a siting case.  She has also filed testimony at the Maryland PSC on service quality issues.  Ms. Schilberg conducted a nationwide survey on utility customer service standards, and has served on a CPUC task force to create inspection, maintenance, and reliability standards for electric utilities.  She has served as a member of a committee on transmission planning standards for the California Independent System Operator (ISO).

 

Relating to environmental issues, Ms. Schilberg estimated the energy impacts of the South Coast Air Quality Management District’s 1994 Air Quality Management Plan and its Rule 1135 on powerplant emissions.  She prepared a major report on valuation of environmental externalities for Environment Canada, and supervised the preparation of major reports for the Photovoltaic Education Program of the National Association of State Utility Consumer Advocates.  In the area of quantitative analysis, she reviewed CEC demand forecasts in three Electricity Reports, and also modeled generation systems of three Hawaiian utilities.

 

Earlier Ms. Schilberg worked for the United Nations Conference on Trade and Development in Geneva.

 

Gayatri Schilberg Selected Documents and Decisions

In celebration of Gayatri Schilberg’s retirement, we have prepared a document that summarizes selected cases and decisions that she participated and contributed to. The complete document can be downloaded here.

 

The following is a summary of the cases highlighted in the document:

 

Year/

Client

Case or Decision

Page

Description

 

 

3

Executive Summary

 

 

15

Gayatri Schilberg Qualifications

1987

 JBS

 

16

Letter from Gayatri to Jim Helmich accepting JBS’s job offer.

1988

JBS

 

 17

Memo to JBS associates telling them how to use the new Laser Printer.

 

 

20

JBS Pictures

1991

South Coast AQMD

Rule 1135

28

JBS Energy, Inc. produced an analysis of the cost-effectiveness of reducing NOx emissions at utility steam plants in the South Coast Air Basin as part of the District’s development of Rule 1135, a NOx control strategy for these plants. Gayatri was the project manager for this report and conducted large portions of the modeling of the SCE system. Over the objections of the utilities, Rule 1135 was adopted.  When the SCAQMD governing board became more conservative in 1994, Rule 1135 was junked for political reasons and replaced with the “market based” RECLAIM system.  The replacement rule contributed greatly to the price gouging California energy crisis in 2000-2001, demonstrating that the JBS approach originally adopted by the District was sound.  

1993

TURN

CPUC Decisions D.93-05-062 and D.94-04-057

57

TURN filed complaint (3/1/1991) against Pacific Bell (telecommunications) before CPUC alleging Pacific unlawfully imposed late payment charges and disconnected customers between 1986 and 1991. TURN also alleged that Pacific’s management was aware of the practice and consciously chose to continue it, ignoring the Company’s tariffs, to the a) benefit of its shareholders and the b) detriment of its customers. TURN estimated the erroneous charges amounted to $33 million. TURN also sought a shareholder penalty of $50 million. Gayatri filed testimony that estimated the customer refund amount and providing evidence of management complicity.

Pacific Bell admitted to some erroneous charges but claimed it took immediate action to remedy the situation when it first understood the situation. Pacific estimated its erroneous charges amounted to $3 million and it opposed any imposition of a penalty.

The CPUC found Pacific guilty of all offenses and ordered Pacific to refund $34.32 million in late payment charges and imposed a $15 million penalty on the Company’s shareholders.

1997

Nevada County District Attorney

Nevada County versus PG&E

89

Nevada County District Attorney’s office filed criminal charges against PG&E for negligence and causing a devastating wildfire in Sierra’s in 1994. Gayatri submitted evidence that PG&E had diverted about $77 million from customers between 1987 and 1994 that it told the CPUC was needed to protect the public from the threat of wildfires to its shareholders. Some of the most damaging evidence produced by Gayatri came from internal memorandum from PG&E’s corporate headquarters praising field managers for cutting tree trimming costs.

1998

TURN/ORA

CPUC Decision D.98-03-036

 93

Electric Distribution Facility Standards. A. 94-12-005, PG&E GRC.  Got the CPUC to adopt standards for utility responses to major storms and outages. Joint TURN/ORA testimony on Emergency Response Standards. Create emergency plan, train staff, coordinate with media and others, and develop mutual assistance agreements.

2002

Disability Rights Advocates

CPUC Decision D.02-04-026

111

Baseline OIR – Commission adopted a number of Gayatri’s recommendations to improve outreach for medical baseline and simplify the application process. 

2004

TURN

CPUC Decisions, D.04-05-055 and D.04-10-034

126

PG&E 2003 GRC Phase I—A. 02-11-017

In response to PG&E’s Phase I GRC request for recovery of its storm related costs, Gayatri filed testimony opposing that cost increase providing testimony on PG&E’s proposed reliability targets and subsequent incremental funding request.  In D. 04-10-034, the Commission adopted nearly all of TURN’s proposals storm response and other reliability issues. The CPUC made the following findings;

 It agreed with TURN that PG&E’s response was not reasonable regarding outage information on its system,

 PG&E’s prior value of service studies were outdated and any new studies on value of reliability should include a “willingness to pay” element,

 Agreed with TURN that PG&E should amortize a number of its outage information investments as well as be denied funding for certain aspects of its outage IT projects,

 Based on TURN’s testimony it denied a PG&E/CUE request for $27 million in incremental funding based on TURN’s analysis that PG&E should meet and exceed proposed reliability targets levels without any incremental funding.

 Also agreed with a number of other policy recommendations concerning call center standards and ratemaking treatment for storm related and reliability investments.

2005

UCAN

CPUC Decision D.05-08-037

147

SDG&E Catastrophic Event Memo Account A. 04-06-035.

During 1994 SDG&E applied to the CPUC to recover its costs for catastrophic wildfires that occurred in its service territory. SDG&E originally applied to recover $62.7 million from its distribution retail but reduced that figure by $21.9 million to reflect funds that it had already been authorized for this purpose and sought recovery of $40.8 million.

On behalf of UCAN, Gayatri intervened with recommendations on ratemaking treatment as well as a number of policy recommendations. The proposed decision adopted most of UCAN’s recommendations and found that SDG&E failed to exercise reasonable control over its service vendors and also failed to offset its incremental costs with an existing rate allowance for those pole inspection and replacement --costs. The proposed decision adopted UCAN’s proposed disallowances for these items. The final decision did not adopt these recommendations but found that UCAN’s contribution was substantial by insisting that the Commission review the reasonableness of UCAN’s costs estimates to ensure a more detailed review of SDG&E’s cost wildfire cost estimates. 

2006

Alberta CCA and PICA

 

Alberta Energy and Utilities Board Decision 2006-104.

187

Testimony for the Consumer Group caused the Alberta Energy and Utilities Board to reject giving Enmax Energy an advance incentive payment for meeting service quality standards before those standards existed and were adopted by the Board. “The C[onsumer Group] also presented evidence suggesting that under EEC’s proposal, there is a probability that the existing levels of service would be provided at a 30% increased cost, such that “customers would pay more and get nothing in return.” [citing Page 15 of Schilberg Evidence.]

2006

TURN

CPUC Decisions D.06-05-016 and D.06-10-018

196

SCE 2006 GRC – Got SCE to lower request by $40.8 million due to stipulation on reducing Priority 5 maintenance costs.

2007

TURN

CPUC Decision 07-03-044

CPUC PG&E Advice Letter 2838-G/3059-E

211

 

224

Gayatri was responsible for a PG&E service guarantee to pay customers who were shut off in error, as proposed in PG&E's 2007 GRC.  See attached PG&E Advice Letter Advice 2838-G/3059-E ("Quality Assurance Standard Ten for Erroneous Service Termination in Compliance with Decision 07-03-044").  Hayley Goodson remembers: “When TURN was negotiating this with PG&E, they referred to it as the Schilberg Service Guarantee, which is how I've always thought of it since then.”

2007

TURN

CPUC Decision D.07-05-058

 230

 She saved the vast majority of PG&E's branch offices a few years back. PG&E proposed to close all 84 local offices in its 2007 GRC, and we settled for keeping 75 open They are still open and continue to be well-used by PG&E customers.

2007

TURN

CPUC Decision D.07-09-041

252

Improving Access to Medical Baseline – Filed on behalf of Disability rights Advocates – R.01-05-047

2008

TURN

CPUC Decision D.08-03-012

 315

PG&E Backbilling Case from 2003 GRC. This decision found that TURN made a  substantial contribution in an investigation of PG&E’s having backbilled customers $35 mm over multi-year period.(D.07-09-041   adopted most of TURN’s recommendations in this investigation..

2008

TURN

CPUC Decision D.08-07-046

336

 

Gayatri also helped defeat SoCalGas's proposal to close 7 of its 47 branch offices in the Sempra 2008 Cost of Service Proceeding -- and got the Commission to order the Sempra utilities to stop contracting with payday lenders as authorized utility payment locations.  See D.08-07-046, issued in A.06-12-009 et al., pp. 20-21. Of course SoCalGas now has a pending request to close 6 of the 7 branch offices that TURN saved in 2008.Gayatri's work in that case -- A.13-09-010 – is  pending, and we are hoping with confidence that this work will be successful as well.

2008

TURN

CPUC Decision D 08-09-038 in OII 06-06-014

353

 

In D. 09-07-022 CPUC found TURN contributed to D. 08-09-038—investigation into SCE’s fraudulent survey of customer satisfaction indices to wrongly claim PBR rewards. SCE had to refund $48 mm in customer satisfaction incentives, $35 mm in safety incentives. Also refund $32.714 mm in fraudulent results sharing and ordered SCE to pay a $30 mm fine.

2009

TURN

CPUC Decision D09-07-019

373

Service Standards for wireless providers – provided analysis refuting telecom claims that customer complaints were not numerous to worry about. OTHER D.10-07-014 – found TURN contributed to Decision D.09-07-019.

2009

TURN

CPUC Decision D-09-03-025

SCE 2009 GRC –A. 07-11-011

 412

Contributed to D. 09-03-025— SCE 2009 GRC Phase I – A. 07-11-011—

In Edison’s 2009 GRC Phase I, Gayatri intervened on behalf of TURN on customer service issues as well as tree trimming and pole inspections and pole attachment fees.

 Agreed with TURN to implement a moratorium on use of pay day lenders as authorized payment agents agreeing with TURN that customers paying bills at Authorized Payment Agents (APA) are normally the most economically vulnerable and establishing APAs at payday lenders will establish them as targets of predatory lenders.

 Maintained the existing policy of funding utility service guarantees to customers using shareholder funds,

 Convinced the Commission that Edison’s forecast of intrusive inspections of its wood distribution poles is excessive,

 Agreed to implement changes to its tariff language concerning billing errors to ensure consistency with California’s other investor owned utilities.

2013

TURN

CPUC Decision D. 13-08-002

 415

SCE 2012 GRC –Gayatri submitted testimony on Edison’s request to recover hundreds of millions of dollars in capitalized software design and development. The Commission largely agreed with Gayatri’s testimony and ordered all future capitalized software requests be justified by more detailed and cost justified analysis. Specific projects that were disallowed based on Gayatri’s findings included,

  • Interactive Voice Response (IVR) $8.2 million
  • Customer Relationship Management (CRM) $4.5 million
  • Remove all funding for HAN support
  • Removed $16.3 million in IT O&M associated with AMI from base rates
  • Made an across-the-board 10% reduction to all IT capitalized software

2014

TURN

Excerpt from Testimony filed in A. 13-11-003 (SCE 2014 PHASE 1)

452

The case is still pending. Her last major piece of work, examined Edison’s multi-billion dollar program to relieve overloaded poles at electric ratepayer expense.  The testimony recommended that telecommunications companies be given the choice to remove attachments that caused overloading or pay for remediation; proposed a one-time “catch-up” fee for poles with joint owners or attachments.  She also proposed to disallow costs for a make-work program to replace perfectly good, although aged poles that had previously passed inspection.  She also recommended both lower unit costs of replacing poles and a lower number of poles requiring replacement, as well as more payments by telecommunications companies for routine pole maintenance.

 

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[Gayatri Schilberg]