Just closed a case with Dominion Energy Virginia that shows why you need to read every line of complex rate schedules. Hospital client was paying standby service charges of $7,400/month for backup generator service they weren't actually receiving. Turns out their backup power was from an on-site diesel generator, not grid standby. Dominion had been billing standby charges for 14 months based on incorrect service classification. Total recovery $89,200 plus they removed the ongoing monthly charges.
Standby Service Rate Trap - $89K Recovery
Faye, that's a great catch! Standby service billing errors are way more common than people think. Here in Charlottesville I see similar issues with smaller Dominion customers who have backup generators but get billed for utility standby service they don't need. How did you prove the generator was truly independent backup versus utility-supplied standby?
Gerald - the key evidence was the electrical permits and as-built drawings showing the generator was completely isolated from Dominion's service with its own automatic transfer switch. No utility-supplied backup connection existed. Dominion's billing department had misread the service application from 2023 and applied standby charges automatically based on the generator capacity rather than the actual service configuration.
Nice work Faye! Standby service misapplication is definitely a growing issue as more customers install backup generation. Utilities often default to charging standby fees whenever they see generator permits without verifying if standby service is actually provided. This is a good reminder to always audit backup power arrangements on large accounts.
Randy's absolutely right about this being a growing problem. I've got three similar cases in the pipeline right now with Dominion. Faye, did they require any engineering review or did billing department correct it once you showed the electrical drawings?