Finally closed a marathon case with CPS Energy here in San Antonio. Medical facility was incorrectly classified as commercial instead of medical rate schedule for three years. Sounds simple but CPS fought us every step of the way. They claimed the facility didn't meet medical classification because it had retail pharmacy operations. Total recovery was $447,000 but the stress nearly killed me. Anyone else dealt with CPS Energy's medical rate qualification requirements?
CPS Energy nightmare - 3 years to get $450K back
Maria, I feel your pain. CPS has some of the most bureaucratic processes I've encountered. Three years seems excessive though - what kept dragging it out? Here in Tennessee we usually get rate classification disputes resolved in 6-12 months max.
Gary, they kept changing their position on what qualified as "primarily medical use." First it was percentage of square footage, then percentage of revenue, then type of services offered. Each time we'd provide documentation, they'd move the goalposts. I think they were hoping we'd give up frankly.
That's ridiculous Maria. Did you end up having to go to the Texas PUC? I've had good luck threatening regulatory action with Duke Energy here in Charlotte when they get unreasonable on classification issues.
David, we filed a formal complaint with PUC after 18 months of getting nowhere. That finally got their attention. The administrative law judge basically told CPS their interpretation was unreasonable and ordered the refund. Should have gone that route sooner.
Maria, $447K makes the three year battle worth it though! What was your fee structure on something like that? I'm working on a similar medical facility case with AEP Ohio and trying to figure out how to price the engagement given the potential timeline.
Kevin, I did 30% contingency which worked out well given the size of recovery. But honestly, if I'd known it would take three years I might have structured it differently. The carrying costs and opportunity cost of tying up resources that long is significant.
Congratulations on sticking with it Maria! I had a similar rate classification fight with Entergy Arkansas that dragged on for two years. Sometimes these utilities just dig in their heels hoping you'll go away. Persistence pays off but it's emotionally draining.
Thanks Helen. You're right about it being emotionally draining. There were times I questioned whether it was worth the fight. But $450K is $450K and the client was thrilled. Plus now I know exactly how to handle CPS Energy medical rate cases!
Maria, you should document the whole process and maybe write it up as a case study. This kind of intelligence about specific utility practices is gold for the rest of us. CPS Energy serves a huge territory and I'm sure others will face similar issues.
Great suggestion Gary. Maria, if you're willing to write up a detailed case study, we'd love to feature it in our member resources section. These real-world examples of utility-specific challenges are incredibly valuable for our members. The more documentation we have about different utilities' practices and quirks, the better prepared we all are.