Got the State Corporation Commission Involved.

In an earlier post I described my MANY discussions with the power company about how they were calculating 'Demand' and my findings.  An engineer there agreed with me and was going to see about changing the definition.

So far, that hasn't happened.

Meanwhile, I got a copy of their Tariff and read it.  Based on my findings, they are not compliant with their tariff and that's against the law.  The tariff gave essentially the same definition for Demand as their web site and disagreed with my data.  So, after waiting to see any action on their web site or further contact I sent the following email to the Arizona Corporation Commission.  This body is similar to other state's Public Utilities Commission and handles this kind of thing

On 9/4/2010:

Greetings:

 The APS published description of  ‘Demand’ is :

 This component is part of the pricing for the Combined Advantage plans. "Demand" or kW is the average kW used during the 60-minute period of maximum use during the on-peak hours of the billing month. The kW used is determined from readings of your APS meter.

 As taken directly from their website at http://www.aps.com/general_info/search_results.html?required=search&search=demand&x=0&y=0 on 8/25/2010.

 Additionally, the rate tariff defines this same item as:

 DETERMINATION OF KW

 For billing purposes, the kW used in this rate schedule shall be based on the average kW supplied during the 60-minute period of maximum use during the customer’s On-Peak hours, as determined from readings of the Company’s meter.

 Again, taken from the APS web site at http://www.aps.com/_files/rates/ect-2.pdf  on 8/25/2010

 However, this is not what they do.

 A normal person reading the either of the descriptions above would, reasonably, think that APS measures the power usage for an hour and averages the hour’s usage then picks the highest of all the hours for a month and then bills the customer for that number.  Extensive research, testing and observation as well as direct conversations with APS personnel and residential power meter manufacturers have led me to believe they simple take the highest amount of usage for the month and bill for that.

 This may seem like a trivial difference at first glance, but suppose a person has an extremely short period of high use on a single occasion during the month.  They would be billed for that usage at a very high rate.  Simply switching on an additional air conditioner, and then noticing that it was after the beginning of the peak period and switching it off would result in 3 kW additional demand and the subsequent charges in the monthly bill.  During certain peak periods in the summer this could cost as much as $60. Multiply this by the customer base using this rate schedule and it becomes a very significant amount of money.

 To help one understand better a simple case study can be described.  One has a 1000 watt light bulb and turns it on for 15 minutes by mistake during the peak period.  This would result in an additional .250 KwH usage (1000 / 4 for the quarter of an hour), and an additional .250 KwH peak usage and an additional 1 KW peak demand.  The charges would be approximately 3 cents for the power usage and over 13 dollars for the demand component.  Whereas, with the above described ‘average’ method, the additional amount would be .250 KwH for the usage and .250 for peak demand, a very substantial difference.  Moreover, there are other charges derived from the demand number such as Demand Generation and Demand Delivery.  These are not trivial amounts.

 I took the following description directly from a power meter manual supplied to me by the APS Metering Division:

 For block interval, demand calculations are made at the end of each completed demand interval. This method is similar to the way mechanical demand meters operate. As load is applied to the demand register, an indicating pointer and maximum demand indicator are driven upscale. At the end of each interval, the indicating demand pointer is returned to the zero position, and the maximum demand pointer retains its highest or maximum position.

Please note that I’m not disputing charges or rates; I’m describing inaccurate and very misleading descriptions of how APS calculates power charges.  People trying to minimize the impact an electric bill has on their family during these troubled economic times need accurate information to make good decisions.  Conversely, this is a extremely rewarding mistake from APS’s perspective that could, and maybe has, resulted in huge windfall amounts.  I’m not sure of the legal impact of the difference between what APS is actually doing and the description in the tariff.  I’m assuming the tariff is a legal document and someone holds them accountable to it.

Sincerely,

David Thompson

 I waited until 9/14/2010 and sent the same mail again along with a phone message to the head of the Utilities Division of the Commission.  Guess what?  I actually got a phone call from a nice lady named Trish.  She said she was forwarding my comments to the executives at APS (the power company) for their comments and that both they and Trish would contact me again after the response.

Can you believe it?  I've actually gotten responses instead of being stone-walled.  I haven't seen any actual action to speak of, but it's encouraging.