paula johnson -bacon paula.bacon@dteenergy

February 9, 2021 Ms. Lisa Felice Executive Secretary Michigan Public Service Commission 7109 West Saginaw Highway Lansing, MI 48917

RE: In the matter of the application of DTE Electric Company for review and approval of its revised Advanced Meter Infrastructure Opt-out Program

MPSC Case No: U-20837 Dear Ms. Felice: Attached for electronic filing in the above referenced matter is DTE Electric Company’s Rebuttal Testimony of Witnesses John A. Jamerson, Habeeb J. Maroun and Arvind R Sharma. Also attached is the Proof of Service.

Very truly yours, Paula Johnson-Bacon

PJB/erb Encl. cc: Service List

Paula Johnson-Bacon (313) 235-7052 [email protected]

DTE Electric Company One Energy Plaza, 1635 WCB Detroit, MI 48226-1279

STATE OF MICHIGAN

BEFORE THE MICHIGAN PUBLIC SERVICE COMMISSION

In the matter of the application of ) DTE Electric Company for review ) MPSC Case No. U-20837 and approval of its revised Advanced ) Meter Infrastructure Opt-out Program ) ____________________________________)

REBUTTAL TESTIMONY

OF

JOHN A. JAMERSON

DTE ELECTRIC COMPANY REBUTTAL TESTIMONY OF JOHN A. JAMERSON

Line No.

JAJ -1-Rebuttal

Q1. Please state your full name, title, business address and by whom you are 1

employed?2

A1. My name is John A. Jamerson. My business address is One Energy Plaza, Detroit, 3

Michigan 48226. 4

5

Q2. Did you file direct testimony in this proceeding on behalf of DTE Electric 6

Company (DTE Electric or Company)? 7

A2. Yes. 8

9

Q3. What is the purpose of your rebuttal testimony? 10

A3. The general purpose of my rebuttal testimony is to address certain statements made 11

by Residential Customer Group (RCG) Witness Mr. Crandall. Specifically, I will 12

provide corrections to Witness Crandall’s direct testimony regarding opt-out policy 13

and practice and rebut RCG’s accusations of deficiencies in DTE Electric’s direct 14

filing. 15

16

Q4. Are you sponsoring any rebuttal exhibits in this proceeding? 17

A4. No. I am not. 18

19

Q5. What is misleading about Mr. Crandall’s direct testimony alleging that DTE 20

Electric has not provided cost support for its Opt Out Program? 21

A5. Throughout his direct testimony, Mr. Crandall’s mixes a discussion of the AMI 22

Program and the AMI Opt Out tariff. Other than the 80 customers who have refused 23

the Company access to replace their analog meters with AMI meters, the AMI 24

Program is complete. 25

J. A. JAMERSON Line U-20837 No.

JAJ -2-Rebuttal

Witness Crandall’s discussion of the history of the AMI Program is not used in the 1

development of a cost-based opt out tariff. Witness Crandall’s discussion of the 2

cost of metering rate classes other than the Residential rate class, are outside the 3

scope of this proceeding. 4

5

Q6. What is the status of the Opt Out customers mentioned by Mr. Crandell on 6

page 5, line 5 through 7 whose metered radios were not turned off? 7

A6. All of the historical issues raised by Witness Crandall have been completely 8

resolved and have no relevance to this proceeding, which is the determination of a 9

proper AMI opt out tariff. DTE Electric entered into a settlement agreement with 10

the RCG, the MPSC Staff and the AG that was approved by the Commission on 11

December 20, 2018. DTE Electric has complied with the terms of the settlement 12

agreement in both letter and spirit. DTE Electric instituted a project to replace all 13

existing AMI opt out meters with digital meters that have no radios, at no cost to 14

the customer. In additional, the AMI opt out meters were tested to see if they were 15

transmitting radio signals at the time of replacement with information reported by 16

use of smartsheets. If the radio(s) were found to be transmitting, the customers were 17

refunded the initial fee ($67.20) and the meter reading fee ($9.80) with interest from 18

the date the AMI opt out meter was installed until the date it was replaced by DTE 19

Electric Field representatives. 20

21

Q7. Witness Crandall’s states on page 6, lines 19 and 20 that DTE Electric’s policy 22

coerces customers to pay a higher cost to maintain their existing meter. Why 23

is maintaining existing meters not feasible? 24


JAJ -3-Rebuttal

A7. Analog meters are being replaced with digital meters due to obsolescence. Analog 1

meters are no longer manufactured in the United States. The new industry standard 2

meter is a digital meter with a radio or without a radio installed inside. As pointed 3

out in the rebuttal testimony of Witness Maroun, the opt out customer causes DTE 4

Energy additional costs that would not be equitable for the remaining Residential 5

customers to subsidize. 6

7

Q8. On page 7, lines 15 thru 22 Witness Crandall addresses among other items, the 8

concerns that customers may have with the collection, use and ownership of 9

the data collected by the AMI meter. Can you explain how DTE Energy 10

protects customer data? 11

A8. The Company takes its role of securing customer data very seriously. DTE Energy 12

has an approved Data Privacy tariff (Section 14.1) that describes the framework for 13

customer data privacy practices and policies with which DTE Energy fully 14

complies. DTE Energy monitors and upgrades its security systems to detect and 15

deflect hacking threats. DTE Energy equipped all smart meters with data 16

technology that encrypts your data before it is transmitted. All Company employees 17

must pass security awareness training each year and the Office of Compliance 18

ensures that specific rules are being followed. 19

20

Q9. On page 8, lines 5 thru 7, Witness Crandall states, “The data transmitting 21

meter and communications system is designed to collect an immense amount 22

of very specific data, perhaps as short as every few seconds, concerning all 23

aspects of a private residence, which is itself highly intrusive, and which can 24

lead to abuses.” Can you explain the specific data that DTE Energy collects? 25


JAJ -4-Rebuttal

A9. AMI meters do not record or store any personal information and are not surveillance 1

devices. They simply capture, measure and register electrical usage. The normal 2

setting for Residential AMI meters is to capture usage at hourly intervals and 3

transmit the data back to the company daily. 4

5

Q10. On page 8 of his direct testimony, Witness Crandall states, “that DTE Energy 6

has not provided the entirety of its actual meter reading costs attributable to 7

its various service classes, or to specifically the residential class. Has Witness 8

Crandall explained why RCG believes it is necessary to have historic meter 9

reading costs by customer class and historic incremental costs by customer 10

class to establish a cost-based opt out tariff? 11

A10. No. Witness Crandall has not explained why this information is germane or how 12

this historical information would be used to design an AMI opt out tariff. DTE 13

Energy possesses all the information needed to calculate the cost imposed by the 14

typical AMI opt out customer. In fact, MPSC Staff spent months auditing DTE’s 15

cost support. MPSC Staff Witnesses Rogers and Gottschalk determined that DTE’s 16

tariff is supported by the 2019 cost data. 17

18

On page 5, lines 6 and 7 of her direct testimony, MPSC Staff witness Danielle 19

Rogers states, “Staff has reviewed the Company’s proposal and determined the 20

reduction of the initial fee from $67.20 to $40.69 is reasonable and prudent”. On 21

page 8, lines 10 thru 12 of her direct testimony, MPSC Staff witness Danielle 22

Rogers states, “Staff concludes the proposed monthly opt-out fee of $9.82 is an 23

accurate cost the Company incurs each month to serve participants in the AMI Opt-24

Out Program. Staff agrees this cost should be paid by the participants of the 25


JAJ -5-Rebuttal

program as they are choosing this more costly alternative of having their electric 1

meter manually read “. 2

3

The Opt Out Tariff is for electric residential customers only and no other DTE 4

Energy rate classes have shown an interest in an opt out tariff. Customers who 5

decide to receive the non-transmitting meters become the basis for the opt out meter 6

reading cost. That cost is based on the meter reading contractor cost for opt out and 7

the cost to process the meter reads for the opt out customers. 8

9

Q11. On page 11, lines 28 and 29, regarding the 80 customers that have not provided 10

DTE Energy access to their meters, Witness Crandall states: “DTE’s 11

testimony concerning a cut-off of electric service to the subject customers is 12

too unclear and constitutes an unreasonable open-ended delegation to DTE 13

Energy to cut-off service”. Please explain DTE Energy’s shutoff policy? 14

A11. DTE Energy follows the Michigan Public Service Commission. Rule 460.137e that 15

states a utility can shut off electric service to the customer if “The customer has 16

refused to arrange access at reasonable times for the purpose of inspection, meter 17

reading, maintenance, or replacement of equipment that is installed upon the 18

premises, or for the removal of a meter.” Also, Michigan Public Service 19

Commission Rule 460.139.e-g discusses the shut off notice. Under this Rule, the 20

customers have the following options: 21

• File a complaint disputing the claim of the utility before the proposed date 22

of the shutoff of service. 23


JAJ -6-Rebuttal

• Request a hearing before a utility hearing officer if the complaint cannot 1

be otherwise resolved and that the customer must continue to pay their 2

utility bill to the utility. 3

• Represent himself or herself, to be represented by counsel, or to be assisted 4

by other persons of his or her choice in the complaint process. 5

DTE Electric sends a shutoff notice to customers 10 days prior to the shut off 6

which follows these Commission rules. Another letter is sent five days before the 7

shutoff. The reason for the shutoff of these customers is access to our equipment. 8

9

On page 8, of her direct testimony, MPSC staff witness Danielle Rogers states, 10

“Staff agrees with the Company that the 80 customers who have refused DTE 11

Electric access to their property to install an AMI meter should be placed in the 12

AMI Opt-Out Program and be responsible for the monthly fee of $9.82. 13

14

Q12. Does this conclude your rebuttal testimony? 15

A12. Yes, it does.16

STATE OF MICHIGAN



REBUTTAL TESTIMONY

OF

HABEEB J. MAROUN

DTE ELECTRIC COMPANY REBUTTAL TESTIMONY OF HABEEB J. MAROUN

Line No.

HJB -1-Rebuttal

Q1. Please state your full name, title, business address and by whom you are 1

employed?2

A1. My name is Habeeb J. Maroun and I am employed by DTE Energy Corporate 3

Services, LLC. 4

5

Q2. Did you file direct testimony in this proceeding on behalf of DTE Electric 6

Company (DTE Electric or Company)? 7

A2. Yes. 8

9

Purpose of Testimony 10


A3. The purpose of my rebuttal testimony is to respond to statements made by Witness 12

Crandall representing The Residential Customer Group (RCG). Specifically, I will 13

provide comments on Witness Crandall’s testimony regarding opt-out surcharges 14

and tariff modifications. 15

16

Q4. Are you sponsoring any exhibits in this proceeding? 17

A4. No, I am not. 18

19

Rebuttal of RCG Witness Crandall 20

Q5. On page 4, lines 1 thru 3 Witness Crandall claims that DTE Electric did not 21

examine the initial and monthly opt-out charges subsequent to the 22

Commission’s Order in Case No. U-17053. Is this correct? 23

A5. No. In the Commission’s Order on December 11, 2015 in Case No. U-17767, the 24

Commission required the Company to review the opt-out charges either in its next 25

H. J. MAROUN Line U-20837 No.

HJB -2-Rebuttal

rate case or six months after completion of AMI meter installation, whichever 1

occurs first (Order page 98). 2

3

The Company complied in Case No. U-18014 whereby Company Witness 4

Sitkauskus supplied updated cost and participation data which showed the updated 5

AMI opt-out one-time fee and monthly charge which were even higher than what 6

was currently being charged at the time. The Company did not change the opt-out 7

surcharges in that case. 8

9

Q6. What did the Commission indicate in its January 31, 2017 Order in Case No. 10

U-18014? 11

A6. The Commission stated. “Because DTE Electric has yet to complete its AMI 12

installation, the Commission agrees with the company, the Staff, and the ALJ that 13

it is premature to review and amend the opt-out charges. Therefore, the 14

Commission adopts the ALJ’s recommendation that within six months after the 15

completion of its AMI installation, DTE Electric shall file, in a separate docket, an 16

application for review of the opt-out charges.” (page 129) 17

18

Q7. Was DTE Electric required to review its opt-out surcharges in subsequent rate 19

cases? 20

A7. The Company was not required to review its opt-out surcharges in Case Nos. U-21

20162 or U-20561 since the AMI program was not complete at the time of either 22

filing. The Commission further ruled in its May 8, 2020 Order in Case No. U-23

20561 that they would “review AMI opt-out charges in a separate docket to be filed 24

by the company in the third quarter of 2020.” (page 241) 25


HJB -3-Rebuttal

Q8. Do you agree with Witness Crandall’s claim on page 4, lines 18 thru 21 that 1

DTE Electric has not provided an “adequate cost of service study or financial 2

study” supporting the current opt-out surcharges? 3

A8. No. Testimony and exhibits supporting the proposed electric opt-out charges have 4

been supplied in the direct testimony and exhibits prepared by myself and Witness 5

Jamerson in the instant case. 6

7

Q9. On page 5 lines 21 and 22, and page 6 lines 1 and 2, Witness Crandall states 8

that all customers pay for AMI costs including those choosing opt-out. Is this 9

true? 10

A9. No. To the extent that AMI costs are included in base rates, then opt-out customers 11

initially pay for a portion of these costs. However, as shown on my Exhibit A-1 12

Revised, Schedule 1, Lines 7 and 8, opt-out customers are then credited these AMI 13

costs in the monthly opt-out surcharge. 14

15

The MPSC Staff sponsored the direct testimony of Witness Gottschalk, who 16

independently verified that the Company removed the costs of the AMI Program 17

from the costs assigned to opt-out customers. 18

19

Q10. Witness Crandall recommends on page 8, lines 16 and 17 that the “DTE tariff 20

should be revised to allow an opt-out with no charges or fees.” Do you agree? 21

A10. No. Witness Crandell’s proposal contradicts the principle of cost causation. That 22

is, absent the opt-out charge proposed by the Company, the costs associated with 23

the opt-out program would need to be recovered from other DTE Electric customers 24


HJB -4-Rebuttal

through base rates. It would be inappropriate for other customers to pay for the 1

specific costs resulting from those who voluntarily choose opt-out service. 2

3


A11. Yes, it does.5

STATE OF MICHIGAN



QUALIFICATIONS

AND

REBUTTAL TESTIMONY

OF

ARVIND R SHARMA

DTE ELECTRIC COMPANY QUALIFICATIONS OF ARVIND R SHARMA

Line No.

ARS-1-Rebuttal

Q1. What is your name, business address and by whom are you employed? 1

A1. My name is Arvind R Sharma. My business address is One Energy Plaza, Detroit, 2

Michigan, 48226. I am employed by DTE Energy Corporate Services. 3

4

Q2. What is your current position with the Company? 5

A2. I serve as a Manager – Meter Reading and AMI Strategy. 6

7

Q3. On whose behalf are you testifying? 8

A3. I am testifying on behalf of DTE Electric Company (DTE Electric or Company). 9

10

Q4. What is your educational background? 11

A4. I have a bachelor's degree in technology (B.S Electronics and Communications) 12

from Manipal Institute of Technology, India and a master's degree in Industrial and 13

Operations from the University of Michigan, Ann Arbor. 14

15

Q5. Have you completed any seminars or other training courses? 16

A5. I have completed training courses pertaining to Meter Reading and Billing systems 17

including and not limited to Multi-Vendor Reading Systems, Field Collection 18

systems and SAP. I have certifications of the same. 19

20

Q6. What is your employment history? 21

A6. I joined DTE in March 2009 as a Developer in the IT Department. From 2009 to 22

2014, I worked on management and development of Meter Reading and Customer 23

Information IT systems at DTE Energy. I worked on implementing Automated 24

Meter Reading technology and supporting AMI installation in this role. From 2014 25

A. R. SHARMA Line U-20837 No.

ARS-2-Rebuttal

to 2017, I worked on the business side of Metering and Billing operations as a 1

Principal Analyst assisting with SAP implementation and migration of the meter to 2

cash processes at DTE Energy. Subsequently, I held leadership roles in the capacity 3

of a Principal Supervisor – Customer Service. Currently I serve as a Manager – 4

Meter Reading and AMI Strategy, managing DTE Energy’s internal meter reading 5

and Consecutive Estimates team, URG service providers, and giving work direction 6

to IT to support our business operations. 7

8

Q7. What are your current duties and responsibilities? 9

A7. I manage the Company’s Manual Meter Reading and Consecutive Estimates team, 10

URG service providers and I give work direction to IT to support our business 11

operations. 12

13

Q8. Have you previously sponsored testimony in cases before the Michigan Public 14

Service Commission (MPSC or Commission)? 15

A8. No. 16

17

DTE ELECTRIC COMPANY REBUTTAL TESTIMONY OF ARVIND R SHARMA

Line No.

ARS-3-Rebuttal

Purpose of Testimony 1


A9. The purpose of my testimony is to explain why Witness Crandall’s alternative AMI 3

opt out meter reading proposals should not be approved by the Commission. I 4

explain why these proposals would cause increased costs and unintended 5

consequences. 6

7

Q10. On page 5 of his direct testimony, Witness Crandall suggests a no cost, opt-out 8

option, without an initial charge and monthly surcharges. On page 9 he states 9

that the Commission’s billing rules allow a self-reading option. What is the 10

faulty basis for Mr. Crandall’s recommendation? 11

A10. The faulty basis in Witness Crandall’s recommendation is his proposal would create 12

opt out costs that would then be passed on to opt out customers. 13

14

Each month, DTE Energy physically attempts to read the actual meter of every opt 15

out and non-AMI customer. However, if we are unable to obtain the read, DTE 16

Energy does accommodate self-reading options including obtaining reads over 17

phone or extracting reads off pictures sent by customers. Exercising an exclusive 18

self-reading option as suggested by Crandall would have negative results. 19

20

Q11. What are some of the implications of customers self-reading their meter? 21

A11. DTE would have no control around the consistency of our customers sending in 22

pictures of their meter or providing reads on a monthly basis. The result would be 23

an increase in estimated billing and consequent customer complaints. Further, this 24


ARS-4-Rebuttal

would increase DTE’s consecutive estimate count that the Commission has urged 1

the Company to minimize. 2

3

DTE does not have the workforce to handle the self-reading option on a monthly 4

basis as a program. The billing analysts who process the customer reads and pictures 5

are the same billing analysts that collect meter reads on an exception basis in 6

situations where DTE can’t physically access the meter. Reverting to a manual 7

process would require additional staff to work a manual process of read collection, 8

validation and Billing system update. Based on cost-of-service principals as 9

discussed by Witness Maroun in both his direct and rebuttal testimony, associated 10

costs would have to be billed back to the opt out customer. 11

12

DTE is under a Commission-mandated billing window (26 – 35 days) to bill our 13

customers. Ideally, the Company reads customers on the scheduled meter read date 14

within a 3-day window to ensure bill normalization. If the customers send reads 15

outside of the window, DTE will have to make a physical visit to the site to hit its 16

Bill Rate metric of 98.8%. 17

18

Under Witness Crandall’s proposal, if customers send incorrect reads or read the 19

meters incorrectly and receive high or low bills, DTE would not be able to reconcile 20

the discrepancies for a year. Based on my experience, this may result in customer 21

complaints or loss of revenue. Currently, the Company has an internal goal to 22

attempt to limit back billing customers beyond a certain timeframe to help drive up 23

customer satisfaction. 24

25


ARS-5-Rebuttal

Managing the opt-out fee process, exempting charging the customers only on 1

months they send us the reads within the bill window would be a challenge. On top 2

of this, explaining to the customer why we made a site visit and are charging a fee 3

despite a read sent (outside of the MPSC mandating bill normalization date range) 4

may result in more customer complaints. 5

6

Q12. On page 9 of his direct testimony, Witness Crandall recommends that "there 7

should be no requirement for an actual monthly meter reading and that their 8

only needs to be one annual actual meter read. What are the problems and 9

costs associated with Mr. Crandall's proposal? 10

A12. Currently, DTE has over 50-meter readers in the field collecting periodic production 11

meter readings and consecutively estimated customer meter reads daily. Moving to 12

one annually read meter reading process would have the following drawbacks in 13

addition to the drawbacks stated previously such as an increase in estimated billing, 14

consecutive estimates, customer complaints, opt-out fee management, managing 15

billing within the commission mandated bill window and loss in revenue. 16

17

While most of the meter reading work is managed by our URG service provider, 18

DTE attempts to keep the costs low by optimizing the field work and negotiating 19

the lowest pricing via our internal bidding process. URG constantly hires meter 20

readers to backfill and keep up with the constant attrition they face. If the Company 21

reverts to an annual reading process, DTE wouldn’t have the appropriate staffing in 22

place to accomplish this on a yearly basis. 23

24


ARS-6-Rebuttal

On the technology front, DTE’s billing system is designed to handle monthly 1

periodic automated meter reading. There could be technology constraints to handle 2

a portion of non-AMI customers on annually scheduled reading routes while the rest 3

on a monthly scheduled billing portion. 4

5

Q13. On page 9 of his direct testimony, Witness Crandall advocates a billing option 6

for AMI Opt Out customers similar to DTE’s budget payment program by 7

which customers can pay monthly billings based upon overall estimated electric 8

usage, subject to an annual reconciliation. Why do you disagree with Mr. 9

Crandall's recommendation? 10

A13. DTE needs to see the monthly actual consumption data to accurately capture usage 11

spikes and consumption behavior changes to perform quarterly reviews, thereby 12

making appropriate adjustments to the budget plan. This would help ensure the 13

customers would not owe any balloon payments during the reconciliation month. 14

DTE believes this is in the best interest of both our customers and the enterprise. 15

Therefore, I disagree with Mr. Crandall’s recommendation. 16

17

Q14. On page 9 of his direct testimony, Witness Crandall recommends a self-18

read/self-report billing option that would provide opt-out customers with the 19

option of receiving a waiver of any opt-out surcharges if they agree to 20

participate in the self-read/reporting of their monthly electric usage and/or 21

participate in the company’s budget payment program. Why would Mr. 22

Crandall's recommendation be poor policy? 23

A14. Mr. Crandall is incorrect that his proposal would eliminate virtually all opt-out 24

customer costs, and that DTE would not incur specific incremental costs. Witness 25

A. R. SHARMA Line U-20837No.

ARS-7-Rebuttal

Crandall incorrectly assumes that DTE already has the infrastructure, personnel, and 1

programs to support the self-read/self-reporting option and the budget payment 2

program. This approach would create various problems I previously discussed and 3

create incremental cost attributable to the opt-out customer. Contrary to Mr. 4

Crandall's representation, these are not costs DTE is currently being compensated 5

in base rates. 6

7


A15. Yes, it does.9

STATE OF MICHIGAN



PROOF OF SERVICE

STATE OF MICHIGAN ) ) ss. COUNTY OF WAYNE )

ESTELLA R. BRANSON states that on the February 9, 2021, she served a copy of the

DTE Electric Company’s Rebuttal Testimony of Witnesses John A. Jamerson, Habeeb J. Maroun

and Arvind R Sharma via electronic mail upon the persons listed on the attached service list.

______ ESTELLA R. BRANSON

MPSC Case No. U-20837 SERVICE LIST

ADMINISTRATIVE LAW JUDGE Honorable Martin Snider Administrative Law Judge Division 7109 W. Saginaw Highway Lansing, MI 48917 [email protected] MPSC STAFF Benjamin J. Holwerda Monica M. Stephens Daniel E. Sonneveldt Assistant Attorney General sniderm Public Service Division 7109 W. Saginaw Highway, Fl 3 Lansing, MI 48917 [email protected] [email protected] [email protected] RESIDENTIAL CUSTOMER GROUP Don L. Keskey Brian W. Coyer University Office Place 333 Albert Avenue, Suite 425 East Lansing, MI 48823 [email protected] [email protected]

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