Our client in Knoxville just got hit with a massive rate increase because TVA changed how they classify primary vs secondary service. They've been taking service at 12.47kV for years and getting the primary discount on Schedule GSA-3. Now TVA says because they don't own the step-down transformer, they're reclassifying as secondary service. Anyone else dealing with this? The difference is about $180,000 per year for this facility.
TVA's primary service discount - anyone else seeing rate schedule changes?
We're seeing similar issues here with APS in Phoenix. They're getting more strict about the transformer ownership requirement. If the customer owns the transformer stepping down from primary voltage, they still qualify for primary rates. But if APS owns any part of the transformation equipment, even just the disconnect switch, they're calling it secondary. It's becoming a real headache to audit these classifications.
Indianapolis Power & Light pulled the same stunt on us last year. We had to file a formal complaint with the IURC. The key is proving that your client meets the true definition of primary service - they have to own, operate, and maintain all transformation equipment on their side of the delivery point. Got a $340,000 refund for one client when we proved IPL had been misclassifying them for three years.
Seattle City Light has pretty clear rules on this - they use the 4kV threshold. Anything delivered at 4kV or above qualifies for primary rates if customer owns the transformer. Below 4kV is automatically secondary regardless of ownership. But even here we've had disputes over voltage measurement points. They want to measure at the meter, we argue it should be at the service connection point.
The voltage measurement point is crucial. Most tariffs specify 'delivery voltage' but don't clearly define where that's measured. We've successfully argued that voltage drop in customer-owned equipment shouldn't disqualify them from primary rates. Terry, did you get anywhere with that IPL complaint? We might need to file something similar with the Tennessee commission.
The IURC sided with us on the measurement point issue. They ruled that delivery voltage should be measured at the utility's point of delivery, not after any customer-owned equipment. IPL had to reclassify about 200 accounts and issue refunds totaling over $2 million. The key was showing that their own service manual contradicted how they were applying the tariff.
SMUD in Sacramento has been fairly consistent on this. They use 2.4kV as the cutoff and clearly state it's measured at their meter location. The primary discount here is substantial - about 15% reduction in demand charges for Schedule GS-TOU3. But you have to prove transformer ownership with purchase records and maintenance documentation. They audit these classifications every few years.
Just wanted to update everyone - we filed an appeal on that TVA reclassification and won! The key was proving continuous primary service since 1987. TVA had to honor the grandfather clause in their tariff. Client got $440,000 in refunds plus ongoing savings of $180,000 annually. Sometimes these old service agreements are worth their weight in gold when utilities try to change the rules.