Just wrapped up a major case with Westar Energy (now Evergy) here in Kansas. Industrial client was being charged supply rates on what should have been delivery-only usage during scheduled maintenance outages. When they were drawing minimal power for essential systems, Westar was applying the full blended rate instead of just delivery charges. Three years of billing errors totaled $45,200 in overcharges. Anyone else seen allocation errors like this in deregulated territories?
Westar Energy supply vs delivery allocation error - $45K recovery
Rachel, that's a great catch! Here in Arizona with APS we see similar issues during partial outages. The billing system doesn't always recognize when a customer is only taking delivery service. Did Westar require you to provide documentation of the maintenance schedules to support the dispute?
Linda, yes they wanted detailed maintenance logs and load profiles showing the reduced consumption periods. The key was proving that during those hours, the facility was only using power for safety systems and wasn't actually consuming their contracted supply. Took about 6 months to resolve but they paid with interest.
This is exactly the kind of detail work that separates good auditors from great ones. I'm working with Kentucky Utilities and LG&E here in Lexington and haven't run into this specific scenario yet, but I'll definitely be watching for it. Rachel, did you have to get involved with the Kansas Corporation Commission or did Westar settle directly?
Great case study Rachel. Up here in South Dakota with Otter Tail Power, I've seen similar allocation issues but much smaller dollar amounts. The key lesson is that in deregulated markets, you really need to understand exactly when supply charges apply versus when it's delivery-only. Westar settling directly shows they knew they were wrong.