Just learned something that expanded my audit scope significantly. Natural gas meters measure volume, but the billing is based on therms or CCF at standard pressure. If the gas is delivered at higher-than-standard pressure, a pressure correction factor is applied to convert the metered volume to standard conditions. I found a food processing plant in South Jersey on South Jersey Industries where the correction factor was set to 1.08 when it should have been 1.03 based on the actual delivery pressure. That 5% difference was costing the client $1,400/month on a $28,000/month gas bill. Has anyone else found pressure correction errors?
Gas meter pressure correction factor — worth checking
I've found two of these. The correction factor is set when the meter is installed and almost never reviewed afterward. If the delivery pressure changes — which it can when the gas company upgrades infrastructure — the factor should be updated but often isn't. Both of mine were on Dominion East Ohio accounts. One was a steel mill, the other a hospital boiler plant. Combined recovery was about $62,000 over 3 years.
Pressure correction errors are one of the most overlooked items in gas bill auditing because most auditors focus exclusively on electric bills. The correction factor is usually printed on the gas bill — look for "pressure factor," "altitude factor," or "BTU factor." If it's there, verify it against the actual delivery pressure. You can request a pressure test from the gas utility. If the factor is wrong, the refund calculation is straightforward: the percentage difference times the total gas charges for the correction period.
Good tip about requesting the pressure test. Filing that request with SJI today. If the test confirms the discrepancy, this becomes a slam-dunk claim.