Dealing with an outrageous situation here in Akron. FirstEnergy is trying to backbill my manufacturing client $127,000 for what they claim was an 8-year period of under-recording on a 480V service. They're citing some obscure PUCO case from 1987 saying there's no statutory limit in Ohio. The underbilling was caused by their own CT cabinet wiring error that went undetected through multiple inspections. Anyone have recent PUCO precedents on backbilling limits?
Ohio FirstEnergy 8-year backbill attempt - PUCO precedent needed
Jerome, that's insane. While Ohio doesn't have a hard statutory limit, PUCO has consistently ruled that utilities can't backbill beyond what's reasonable for their own errors. Look at Case No. 08-935-EL-CSS where they limited AEP to 24 months for a similar CT wiring issue. The Commission specifically said 8+ years for utility equipment failure was unreasonable and punitive to customers.
Yuri, that's exactly the kind of precedent I need! Do you have the full case citation? FirstEnergy keeps claiming they have unlimited authority under Ohio Revised Code 4905.31 but that statute just allows collection of lawful charges, doesn't address time limits. Their own tariff is silent on backbilling periods which should work in our favor.
Had a similar fight with Xcel here in Colorado. No statutory limit either but the PUC ruled 36 months was the maximum reasonable period for utility-caused underbillings. The key argument was that utilities have a duty to properly maintain their equipment and can't benefit from their own negligence indefinitely. File a formal complaint with PUCO emphasizing the negligence angle.
Randy, the laches argument is brilliant - hadn't thought of that angle. FirstEnergy does quarterly meter readings and annual inspections, so they had 32+ opportunities to catch this wiring error. Going to add that to our PUCO filing along with Yuri's case precedent. This is why I love this forum - you guys always have the best strategies.
Down here in Louisiana, Entergy tried a 6-year backbill on similar CT issues. Louisiana PSC has a 39-month limit but we got it reduced to 18 months using the utility negligence argument. Document every inspection report and maintenance record you can get from FirstEnergy - bet they'll show multiple missed opportunities to catch the wiring problem.
Alabama Power tried something similar - 5+ years of backbilling for their own transformer bank error. Alabama PSC doesn't have statutory limits either, but they ruled 24 months was reasonable for utility-caused underbillings. The Commission specifically noted that longer periods would discourage proper utility maintenance and testing. PUCO should rule similarly.
Great precedents everyone. Filed the PUCO complaint last week citing the AEP case, utility negligence, and laches doctrine. FirstEnergy's initial response was predictably defensive but their legal team seems to be taking it seriously. Will update when we get a ruling - this could set important precedent for other Ohio cases.
Jerome, here's the full citation: PUCO Case No. 08-935-EL-CSS, AEP Ohio vs. Industrial Customer, decided March 2009. The Commission limited backbilling to 24 months specifically because the underbilling was 'caused by utility equipment failure and maintenance deficiencies.' Should be directly applicable to your FirstEnergy case.
Any update on this case Jerome? I've got a similar FirstEnergy situation brewing in Lexington and could use the precedent. They're claiming 5 years on a demand multiplier error that their own technician admits was programmed wrong during installation. Would love to know how PUCO ruled on your 8-year situation.
Carl makes a good point about the negligence angle. In Tennessee, we've successfully argued that extended backbilling for utility equipment failures violates the doctrine of laches - basically that the utility slept on their rights by failing to detect their own errors. Eight years of faulty CT wiring through multiple inspections shows gross negligence on FirstEnergy's part.