Tom A. from Denver here but working with a client who has a new warehouse in New Jersey. PSE&G put them on Schedule GLT (General Large) from day one but the load profile and demand characteristics clearly fit Schedule GLP (General Large Power). The rate difference is enormous - about $2,800 per month. Client has been operating for 14 months and PSE&G claims they can't do retroactive adjustments for "initial rate selection errors." This seems wrong to me. Anyone fought PSE&G on new construction rate corrections?
PSE&G New Construction Rate Disaster
Randy Dawson here. PSE&G's position on new construction rate corrections is not supported by their tariff or NJ BPU regulations. Tom, you need to file a formal complaint with the Board of Public Utilities. The utility has an obligation to place customers on the most appropriate rate schedule regardless of when the error is discovered. I've seen similar cases where PSE&G backed down once the BPU got involved. The key is documenting that GLT was clearly inappropriate from the beginning based on the customer's load characteristics. What's the monthly demand and usage pattern?
Thanks Randy. Monthly demand runs 850-920 kW with very consistent load factor around 0.75. Usage is 480,000-520,000 kWh monthly. The warehouse runs three shifts with minimal demand variation, which is exactly what Schedule GLP is designed for. GLT has much higher demand charges but lower energy rates - completely wrong for this load profile. I'll start preparing the BPU complaint.
David C. in Seattle. Not familiar with PSE&G specifically but those load characteristics scream large power rate in most territories. The high load factor should make GLP much cheaper. Document the monthly savings analysis and emphasize that any competent utility analyst should have recognized this from the original application. New construction rate errors are usually utility mistakes, not customer choice issues.
Iris C. from Boise here. Tom, also check if PSE&G has any internal procedures for rate reviews on new large accounts. Some utilities are supposed to do 90-day or 6-month reviews to confirm appropriate rate classification. If they have such a policy and didn't follow it, that strengthens your case with the BPU.
Great suggestion Iris. I requested their new customer procedures under NJ's Open Public Records Act. Turns out they do have a policy requiring rate optimization review within 90 days for accounts over 500 kW. They never did it. This should be a slam dunk with the BPU now.
Excellent detective work Tom. That policy violation gives you a strong procedural argument in addition to the substantive rate classification issue. Make sure to calculate the full damages including the 14 months of overcharges plus interest. PSE&G will likely settle before the BPU hearing once they see how strong your case is.
Hector R. from El Paso following this thread with interest. We don't have PSE&G here but the principle applies everywhere. Utilities cutting corners on new customer rate analysis costs businesses serious money. Good for you Tom for fighting back instead of just accepting it.
Final update: PSE&G settled! They agreed to reclassify the account to Schedule GLP retroactive to service start and refund $38,400 in overcharges plus 6% interest. Total recovery was $41,280. The BPU complaint was never formally filed - they settled as soon as they saw we had the documentation on their policy violation. Thanks everyone for the guidance and encouragement.