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It’s been a while since my last  round up on social media sightings in state utility commission decisions.  Here’s the next batch, between May and November 2012.

Social media sites as a source of securities law violations

In Mountain State Power , 2012 Ariz. PUC LEXIS 197, the Arizona Commission found that wind company had violated various securities laws when it solicited investors for a wind farm that it didn’t own and failed to register as a salesperson of securities.  Evidence against the company included an ad on Linked In in which the company advertised for investors.

Social media and privacy

In August 2012, the California Public Utilities Commission extended privacy protections concerning customer usage data for gas customers.  The privacy rules established are similar to those already adopted for electric corporations and electric customer data.

Social media and outages

In August 2012, the Connecticut Department of Public Utility Control completed its review of utilities’ performance in Hurricane Irene and discussed the role of social media in crisis communications. While endorsing use of alternative mechanisms such as social media, the Commission found that maintaining a website with storm specific and emergency information is still vital – and that a Facebook page set up in lieu of a web page was not an adequate substitute.

Social media customer education

Both the  Massachusetts and  Kentucky  approved use of various social media tools to educate customers on and promote energy efficiency and demand response programs.  Meanwhile, the Kentucky Commission also  approved use of social media by an energy cooperative to disseminate information about its prepay utility program.

So that’s it for the social media round up. Still not many cases; my sense is that some regulators still don’t fully understand the power of social media while more encouraging, those who do are willing to allow social media practices to develop from the ground up before regulating it.

Source: Uploaded by user via Carolyn on Pinterest

Social media policies are important – but they’re not the only source of guidance that utilities need to follow when engaging social media.  In addition to abiding by social media policies, utilities need to familiarize themselves with the platform’s terms of service, which are often laws unto themselves, utility regulation and codes of conduct (that may apply to endorsements or classification of social media charges for rate recovery  and of course, good old fashioned evidence.  Here’s a pictorial to help you remember it.

After ten days without power, Con-Ed’s customers have had enough.  So they’ve done what any cold-blooded ratepayer (and with temperatures hovering in the 40s, these ratepayers are literally cold) in a similar situation would do:  sued the company .  What’s interesting about the complaint though is that in addition to claiming damages resulting from ConEd’s failure to restore power for more than a week, the lawsuit contends that ConEd was also remiss in failing to communicate with customers about the outages.

Yet are these claims accurate?  According to this detailed Huffington Post dispatch , young Con Ed staffers worked 14 hour days, frantically tweeting and Facebooking updates on restoration efforts and responding to irate customers.

Were some ratepayers left out because they weren’t using social media – or couldn’t access it with the power out? Or was ConEd’s social media campaign not sufficiently extensive or accurate to inform its customers? Although class action lawsuits against utilities
face a tough hurdle (most matters are resolved before utility commissions and in any event, plaintiffs must prove gross negligence to survive summary dismissal), the initial pleadings and discovery are likely to shed insight on the effectiveness of social media as a communication tool in times of crisis and as a potential defense to a lawsuit.

Here’s a webinar on FERC market pull incentives for marine hydrokinetics and other small renewables.  It’s 50 minutes in length and you can access it at this link.  If you have any questions about the webinar or you’d like to contact me about a live workshop for your company or a copy of the slide deck, please email me at carolyn@carolynelefant.com

Social media may cost less than traditional advertising but even so, social media done right doesn’t come cheap.

As I’ve written before, an increasing number of utilities are investing in social media for a  variety  of functions, presumably anticipating that they’ll recover the costs in rates. But not every cent spent by utilities on social media is prima facie  prudent and recoverable as a recent FERC order suggests.

On September 20, 2012, FERC set for hearing  the accuracy and prudence of $5.7 million in expenses for advertising, public relations, consumer education and lobbying included in rates associated with the now abandoned Potomac Appalachian Transmission Highline  (PATH) transmission project.  (Note: for those following the case, PATH has more recently sought recovery of abandoned costs for the project which may be recoverable under FERC policy if prudently incurred).  Questionable expenditures include:

• Costs associated with promotion of the transmission project (which are not recoverable) that had been classified as public education and outreach;
• Costs associated with creation of reliable power coalitions formed by a public relations firm contractor to develop third party support and coordinate efforts for the PATH project and which challengers claimed were really front groups created to provide a false appearance of grass-roots activism and to hide PATH’s sponsorship by professing to promote overall energy infrastructure development.
• Costs associated with a public education and awareness team (PEAT) which the challengers argue does not educate the public as PATH claims, but rather is a public relations advocacy program for the Project.

Though the PATH case doesn’t specifically involve utility use of social media, the outcome will hold valuable lessons.  Social media makes it easy to set up public education campaigns or Facebook pages for coalitions which often serve the dual purpose of education and advocacy.  Utilities that do not narrowly define their social media campaigns may find them subject to question, just like the expenses in this case.

Traditionally, publication in the Federal Register  is deemed constructive notice to the public of a federal agency action or regulatory filing.  Though this precedent has been on the books almost as long as  the Federal Register itself, it’s also pure legal fiction that irks me to no end.  Really, is it reasonable to assume that members of the public flip through the Federal Register  each morning in search of rate filings, infrastructure projects and new regulations that might affect their interests?

So I was gratified to come across this  news story  reporting on an initiative by the New Jersey Board of Public Utilities (BPU) to discuss alternative ways to notify customers of rate hikes, including social media sites such as Facebook and Twitter.  Although the article involves notice of state rather than federal proceedings, the concept of giving notice of administrative actions through social media applies across the board and makes eminent sense.

True, many folks don’t yet use Facebook – and consumer advocates are always concerned that heavy reliance on social media would exclude the elderly and the indigent (though studies persuasively show otherwise.) Still, in any demographic, I’ll bet dollars to digits that far more people check Facebook on a daily basis than the Federal Register.

So move over Federal Register – there’s another source in town to provide the constructive notice that you never delivered very effectively anyway:  Facebook.

Utilities and other players in the energy industry continue to use social media in a variety of ways.  Here’s a list of the latest sightings of social media usage in the energy and utilities industry:

 Competitive electric business  Maine’s competitive retail electricity markets are attracting electricity suppliers from the gas and oil business, such as Dead River, CN Brown  and Gulf Oil. Though familiar names in their respective existing markets, what are these companies doing to fuel their recognition as electricity suppliers?  Why, social media which has lowered the costs of both promoting electric services to potential customers, notes the Press Herald.

Water Utilities Social media is making a splash with water utilities.  Like most businesses, water utilities are struggling in a down economy; social media enables drowning companies to cost effectively build strong customer relationships and provide more responsive service, according to Water Tech Online.  And with water supply scarce in many parts of the country, new start-ups are leveraging social media to create apps that will help water customers share tips on saving power or information on where to purchase water-efficient appliances reports Forbes.

Outages  As they’ve been doing for at least a year, utilities continue to use social media to communicate with customers about storms.  From Maryland  to New Jersey, utilities are using a variety of social media platforms to communicate about storms, outages and other emergency situations.