By Jeff Stidham,
Director of Utility Services
If you’re in business, you’re paying utility bills. There’s no way around it, and unfortunately, they’re not getting any cheaper. Issues such as infrastructure, quality, and scarcity are becoming more complex by the year, and the associated costs to address these concerns will be unavoidable. As utility costs increase, will you be capable of recognizing how they directly impact your business? Will you know what to do, and where to go, when there is a problem? Chelepis can help.
The First Public Utility
On March 25, 1639, at a grist mill on Mother Brook in Dedham, Massachusetts, Governor Winthrop, and Company, approved the digging of a canal that resulted in increased river flow and industrial activity. This project established the first public utility in our country.
Like the first utility that came into being almost 400 years ago, it was typical for local governments to produce, own, and manage utilities because the cost to build and maintain an infrastructure for utility service was very high. But, the times have changed. Today, developments in technology have made it possible for private companies to step in and take ownership of utility services.
Who Sets the Rules?
Knowing how ownership and regulation are structured in the utility industry is important when problems and errors arise. The nature of the problem and the type of error will dictate which authority to pursue. Knowing the structure will also assist in understanding where breakdowns can occur.
Privately-owned utilities are regulated at the state level. These governing bodies go by different names, but they’re typically referred to as utilities commissions, public utilities commissions (PUCs), utility regulatory commissions (URCs), or public service commissions (PSCs). In contrast, publicly-owned utilities are not regulated by the state commissions. They’re regulated at a local level by the city, district, or cooperative where the service is provided.
In either case, there are a number of processes that take place at different levels of authority that ultimately dictate what’s reported on your utility bill. Errors can occur at every step, and they can vary in severity. Being charged an incorrect billing rate is one thing, but what is the next step when a utility is issuing a bill that is inconsistent with the established ordinance? Mastery of the issue and jurisdiction will ensure swift resolution.
Do Errors Exist at My Facility?
At one point, the House Ways & Means Committee reported that utilities overcharge their customers by $19 billion every year in the United States. Chelepis alone has identified over $40 million in utility billing errors. Given these staggering statistics, we wouldn’t recommend turning a blind eye to the possibility of errors on your bills.
Conceptually, an audit is straight forward: You learn how things should be, and see how reality matches up. In reality, audits are logistically cumbersome and their results depend heavily on the expertise and resources available to the audit team. Tying to the billed amounts is not enough. Can your team answer the following questions?
How much utility should my facility use?
What processes / systems at the city level affect my bill?
How trustworthy is the data on my bill?
What will it cost to pursue the identified error?
What are the chances of success?
Why Choose Chelepis?
The typical utility audit won’t give you the answers to the questions above, but Chelepis can. We have billing data for thousands of different facilities across the country, and the billing methods, rates, and procedures for thousands of different utilities. This information, combined with the experience of our licensed staff (CPAs, attorneys, engineers, etc.), has enabled us to reduce utility costs for some of the largest companies in the country.
We manage our work on a contingent basis, with no financial risk to you, so that you can focus on your business’ priorities. We also front any funds needed so that you can realize a return on no initial investment. Do we have your permission to get started?
Our success is based on knowledge of how each occupancy dollar is consumed, calculated, and billed. We offer more than the big accounting firms. We offer real estate industry experience from an operations, accounting, and engineering viewpoint; proven experience not offered by any other firm in the industry.