FL - City Utility Underbills 13 Companies The Lakeland Electric mix-up amounts to $212,000.

Sunday, August 12, 2001

By RICK ROUSOS The Ledger

LAKELAND -- Oops! Lakeland Electric underbilled 13 of its biggest customers a combined total of $212,000 for electricity between May 2000 and May this year.

"There were no checks and balances in the system," utility spokesman Kevin Cook said. "There was no accountability -- but now there is."

The business and industrial customers now being billed for the snafu, a group that includes The Ledger, are given discounts of 25 percent to 30 percent based on how much electricity they use.

In return for the discounts, the companies agree they will be treated differently during times when the demand for electricity threatens to exceed Lakeland Electric's generating capacity.

In the event that no power is available on the open market, the companies would be the first to have their power shut off, which is why the utility refers to them as "interruptables."

They must also pay market-rate prices for power the city utility has to buy from other sources.

Lakeland Electric buys power and passes on the extra cost to the companies.

Since 1995, when the interruptable program began, none of the customers have ever had their power interrupted.

The utility does buy power for the companies on an occasional basis, which cuts into their discounts. Lakeland Electric officials say the interruptable program is similar to ones used throughout the power industry. But for 13 months, Lakeland Electric didn't bill the interruptable customers for the power it bought for them and for which they should have been charged.

What happened, utility officials said, was that the person whose partial responsibility was to compile the charges to the interruptables left the job, and that responsibility didn't get passed along to the replacement worker.

Sharon Bauer, Lakeland Electric's director of customer service, said two people discovered the error, and they now are part of a team responsible for the billing.

Much of that recordkeeping for the interruptables was done by hand but now is done by computer, Bauer said.

After the problem was discovered, it took months to carefully review the purchases to make sure the bills for the 13 customers were right, Bauer said.

All of the companies have been notified of the problem and what they'll be billed, Bauer said. Some have received their bills, and others are deciding whether to pay now or pay monthly over the six months Lakeland Electric is permitting.

Lakeland Electric can use the $212,000.

The utility is having an off year and, through June, has experienced an overall loss of $2.8 million.

An update that includes July should be ready in about a week.

The 25 percent to 30 percent discounts given to the interruptables can mean substantial savings.

For example, in the 13-month period between May 2000 and May 2001, The Ledger saved $234,892, utility officials said. What would have been a $840,738 bill for those months was instead $605,846, a savings of 27.9 percent.

Adding the $29,384 worth of power the utility bought for the newspaper and is now billing it for, the paper's discount for the 13 months is still 24.4 percent.

Executives for several of the interruptable customers declined to comment.

Keith Hulbert, Lakeland Electric's managing director, said the billing foul-up won't repeat itself.

"We found errors, and we were responsible for them," Hulbert said. "We've got accountability systems in place now to make sure it doesn't happen again."

http://www.theledger.com/top_stories/12elec.htm

-- Anonymous, August 16, 2001