Charles O. from Fargo here. This is driving me crazy. New client built a 75,000 sq ft cold storage warehouse 18 months ago. Contractor applied for electric service and utility put them on small general service Schedule GS-1 despite 850kW connected load. Building has been operational 14 months, averaging 520kW demand, and they've been paying commercial rates the whole time. Should obviously be on large general service Schedule LGS-2. Utility says original application didn't specify industrial use so they defaulted to commercial. Anyone dealt with this contractor error situation before?
New Construction Rate Schedule Nightmare - Wrong from Day One
Randy D. here. This is unfortunately common with new construction. The key issues are: 1) Service application typically locks in the initial rate schedule, 2) Many contractors don't understand rate implications when filling out forms, 3) Utilities often default to commercial for anything not explicitly marked industrial. For your cold storage facility, you'll need to prove it qualifies as industrial under the tariff definition. Cold storage is usually considered industrial if it's the primary business function, not just incidental to retail operations. Document the refrigeration equipment loads, compressor schedules, and business purpose. Most utilities will reclassify but may resist retroactive billing adjustments since the original application was technically 'correct' based on information provided.
Warren T. in Boise. Had exact same issue with Idaho Power two years ago. Food processing cold storage, 600kW demand, stuck on Schedule 9 commercial for 8 months. What worked was getting a letter from the facility manager explaining operations and showing it met industrial classification criteria. Idaho Power reclassified prospectively but only gave 3 months retroactive. Better than nothing but still frustrating.
Steve N. from Salt Lake City. Charles, which utility? Rocky Mountain Power has different policies than some others for new construction errors. Also check if the cold storage qualifies for any special industrial rates - some utilities have specific schedules for refrigerated warehouses with better demand charges.
Steve, it's Otter Tail Power. Haven't found any special cold storage rates in their tariff book yet. Randy, good point about the application being 'technically correct' - that's exactly the pushback I'm getting. Warren, 3 months retroactive is better than what they're offering now (zero). What documentation did Idaho Power find most compelling?
Charles, the facility manager letter was huge. Also helped to show the refrigeration load constituted 78% of total facility usage. Equipment nameplate data for all the compressors, evaporators, and control systems. Load profile clearly showed industrial pattern - high baseload from refrigeration with demand spikes when compressors cycled. Didn't look anything like a typical commercial building.
Larry G. from Meridian. One thing to check - make sure the 850kW connected load doesn't push them into an even higher rate class. Some utilities have multiple large service tiers. Also verify they're not missing out on TOU rates that could save even more money with cold storage load flexibility.
Larry, good catch. Otter Tail has Schedule LGS-2 up to 1000kW then LGS-3 above that. They're safely in the LGS-2 range. Working on TOU analysis now - cold storage should be perfect for shifting some loads to off-peak hours. Will update once I hear back from the utility.
Renee H. from Charlottesville. Charles, one more thought - if Otter Tail won't budge on retroactive recovery, consider filing a complaint with your state utility commission. New construction rate errors where the customer had no control over the initial application sometimes get more favorable treatment from regulators than from utilities directly.
Update: Mixed results. Otter Tail approved reclassification to Schedule LGS-2 effective February 1st. Projected savings $1,850/month. But they're only allowing 6 months retroactive recovery despite 14 months of overcharges. Renee, might take your advice on the commission complaint for the remaining 8 months. That's about $15K they're keeping that rightfully belongs to my client.