After 3 years of fighting with Duke Energy Carolina, I finally got resolution on a demand ratchet case that seemed impossible. Client had a power outage in August 2014 that caused their chiller system to restart improperly, creating a 2,847 kW demand spike for exactly 15 minutes. Duke used that single spike to ratchet their billing demand for the next 11 months under their ratchet provision. Total impact was $312,000 in excess demand charges. The breakthrough came when I found Duke's own service reliability report showing the outage was their fault.
Duke Energy Demand Ratchet Nightmare - Finally Resolved!
Derek, that's insane! Georgia Power has similar ratchet provisions but I've never seen them applied so aggressively after utility-caused outages. How did you get access to their reliability reports? That seems like the kind of documentation utilities don't readily share.
Derek, great detective work! Here in Pittsburgh with Duquesne Light, we see similar ratchet abuse but usually can't prove utility fault. What was Duke's initial response when you presented the reliability report? Did they settle immediately or drag it out?
Rachel - I filed a FOIA request with the NC Utilities Commission for all outage reports in that area during that time period. Took 6 weeks to get the documents but Duke's own report clearly stated "transmission equipment failure caused 14-minute service interruption affecting 847 customers." Walt - Duke initially denied any responsibility and claimed the ratchet was properly applied per tariff. Classic utility response.
Derek, that's brilliant research! I need to remember that FOIA approach for future cases. Did you argue that demand ratchets shouldn't apply to utility-caused outages, or was there specific tariff language about force majeure events?
Albert - Duke's tariff actually has a provision that billing demand adjustments can be made for "extraordinary circumstances beyond customer control." The key was proving the demand spike was directly caused by their outage and the customer's equipment responding normally to power restoration. I had to bring in an engineering consultant to document the chiller restart sequence.
Derek, how much did the engineering consultant cost versus the $312K recovery? I'm dealing with a similar situation with PECO where a customer's demand spiked after a voltage sag event. Trying to decide if expert witness costs are justified.
Phil - engineering consultant was $18,500 for analysis and testimony preparation. Expensive but absolutely critical to prove causation. Without technical documentation showing normal equipment response to power restoration, Duke would have claimed customer equipment malfunction. The consultant's report was what finally broke the case open.
Derek, did Duke ultimately pay the full $312K or did you have to settle for less? Also curious about timeline - how long from presenting the engineering report to final settlement?
Sylvia - got full recovery plus interest, total was $327,400. Timeline was 4 months from engineering report to settlement. Duke's legal team reviewed everything and recommended settlement rather than fighting at the commission level. Sometimes having bulletproof documentation makes utilities very reasonable!
Derek, fantastic case study! This is exactly the kind of detailed investigation that separates professional auditors from bill reviewers. The FOIA approach for utility reliability data is something every auditor should know. Mind if I reference this case (anonymously) in my next AAUBA training session?