In case anybody wonders why so many people are suspicious about the
public burdens to be borne in the case of a proposed new NBA arena, all we need do
is remind them that the citizens of Shelby County have been had, and had
quite recently, by a large entity that supposedly exists for their welfare.
And this is no private enterprise that would supposedly benefit everyone
by catering to the entertainment appetites of a relative few. This is a public
agency that is, quite literally, responsible for the comfort, safety, and even survival
of the entire community.
We mean, of course, Memphis Light, Gas & Water, better known as
MLGW. The Flyer‘s Rebekah Gleaves has looked behind the numbers doled out to
the media by the giant utility after the astronomical rate hikes of the winter
and found them superficial and misleading. Indeed, MLGW seems to have
misled not only its customers but perhaps itself in its efforts to justify the squeeze
it imposed on the consumer.
As Gleaves pointed out last week in an exhaustive study of the matter
(updated in the current issue of the Flyer), MLGW ignored its own expert’s
advance estimates of the winter’s drastically higher natural gas prices, lulled
rate-payers (and, again, perhaps itself as well) into complacency with
announcements of a relative rate decrease that would theoretically offset the price
increases, then slapped them hard on their frostbitten cheeks with bills that
were literal budget-busters to most households.
Rates would have gone up astronomically in any case because of the
free-market factors that drove gas prices up. But, in the end, local rate-payers were
charged a full 25 percent more than the national average for December and January.
Why? Because of MLGW’s poor estimates, followed by its willingness to be
disingenuous and to overcompensate itself at the expense of its customers. Readers
interested in just how local rates were manipulated by MLGW are advised to
consult Gleaves’ article, “A ‘Perfect’ Storm,” in the
Flyer‘s April 12th issue. Her cost-accounting is far more revealing than anything the utility itself ever released.
All this is bad enough, but MLGW then made promises to the public it
could not, or would not, fulfill. It offered a variety of rate-payment and
rate-reduction plans, one of which did not take effect until the natural gas emergency was over
— a fact that greatly minimized its impact. Worse, many customers were told
by MLGW office employees that certain plans did not exist.
Worst of all, while it was still officially winter and with cold days potentially
yet to come, MLGW sent technicians around to households throughout its
service area threatening immediate cutoff unless the company’s extravagant and
unexpected winter bills were paid on the spot, to the penny.
Many factors went into this sad performance, including a documented
lack of gas futures purchasing experience on the part of MLGW’s current
leaders. But perhaps the foremost one was the utility’s willingness to leave its
customers in the dark, so to speak, even after it had caught on to its own
mistakes. There has been a Newtonian result of sorts: MLGW’s cold-blooded
behavior has produced a seething response in its customer base, and it is no
wonder that other professed benefactors — such as the city’s NBA arena proponents
— are feeling the heat.
