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National Grid facing fines.

SYRACUSE, N.Y. - National Grid faces at least $6.5 million in penalties for too many power failures and other service problems during 2006, according to the utility's annual service quality report.

The company, whose U.S. headquarters are located in Westboro, Mass., said it failed three of the 11 service quality tests required under its electric rate plan. The tests consist of six areas that measure customer service and five that measure system reliability.

The report comes as National Grid seeks regulatory approval for a takeover of KeySpan Corp., a large downstate utility. Critics of the deal, including staff representatives at the state Public Service Commission, have complained about National Grid's service record.

But National Grid officials said the latest service quality report reveals excellent performance in most areas.

"Are we satisfied with the report? No," said utility spokesman Steve Brady. "Are there positives we can take out of it? Absolutely. "

Customer complaints to the PSC, for example, dropped to an all-time low of 0.98 per 100,000 customers, the utility reported. And the utility enrolled 4,038 customers into low-income assistance programs, above its mandated target enrollment of 3,780.

The largest penalty incurred by National Grid was $4.4 million for having too many power failures.

The utility recorded 1.01 power failures per customer in 2006, above the limit of 0.92 per customer. Because the utility has failed the test for three consecutive years, the PSC could double the penalty to $8.8 million when it reviews the report later this spring.

National Grid passed the other major reliability test, which measures the average duration of outages. It also passed several tests that measure momentary power interruptions.

Utility officials have promised to spend $1.4 billion over the next five years to beef up the electrical network.

On customer service issues, National Grid said it would be fined $1.125 million based on customer satisfaction ratings from small and medium commercial and industrial customers and faced a $993,750 penalty because of poor customer satisfaction ratings.

National Grid serves more than 2 million electric and gas customers in upstate New York.
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Title Annotation:BUSINESS
Publication:Telegram & Gazette (Worcester, MA)
Date:Apr 5, 2007
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