The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

A well-known Freeport food retailer is now challenging its more than $40,000 monthly electricity bill in the Supreme Court, a move that comes after a report uncovered “16 deficiencies” in Grand Bahama Power Company’s metering and billing practices.

Reaffirming his belief that Butler’s Food World should be paying 62.5 per cent less for its electricity than it was being billed for, its principal, Jeff Butler confirmed that the retailer was now locked in a Supreme Court battle with Grand Bahama’s monopoly energy provider.

In a press statement, he disclosed that while Butler’s Food World was challenging its power bill, Grand Bahama Power Company (GBPC) had also petitioned the Supreme Court for an Order requiring the retailer to shut its generators off - an application that, if granted, would force the company to shut down and lay-off 100 staff.

“GBPC has been billing Butler’s Food World over $40,000 per month for services predetermined to cost less than $15,000. per month,” Mr Butler said.

“Like many companies here in Freeport we choose to operate by using our diesel generator for several reasons - to use more reliable and constant power.

“Just last night when the power was off for several hours, Butler’s Food World power supply was uninterrupted. When the power came back on and spiked, thousands of compressors and appliances all over Grand Bahama, Butler’s Food World was safe.

“We have lost several compressors at a cost of $6,000 each due to GBPC’s inconsistent power. Altogether here on Grand Bahama, businesses have lost millions of dollars due to spikes and dips caused by inconsistent electricity from GBPC without any compensation.”

Mr Butler’s Supreme Court battle has coincided with the public release, finally, of a report on GBPC’s billing and metering practices by the PricewaterhouseCoopers (PwC) accounting firm.

The report, commissioned by the Grand Bahama Port Authority (GBPA), GBPC’s regulator, somewhat contradicts the latter’s assertion to Tribune Business several weeks ago that it had effectively received ‘a clean bill of health’, highlighting 16 “deficiencies” and making recommendations to tackle them.

While the report does not provide one ‘huge smoking gun’, it contains enough ammunition that can be exploited by the likes of Troy Garvey and Osman Johnson, and will yet again put GBPC under the spotlight just days after a series of major power outages rocked Grand Bahama.

Apart from detailing a lack of formal, written procedures relating to several areas involving power billing and metering, the PwC report also discloses:

• Although the GBPC’s goal is for 95 per cent of meters to be read, and just 5 per cent of monthly billings estimated, these thresholds have not been agreed with the GBPA as regulator.

• PwC’s field review identified three electricity meters that were not assigned, in GBPC’s billing system, to the locations where they were physically based.

• GBPC did not investigate, by physical site and meter visits, instances where consumers complained about receiving unusually high power bills.

• PwC identified one episode where GBPC’s billing clerks applied an “excessively high estimated consumption” charge to the bill of a customer who had proven difficult to reach, in a bid to force him to contact the power provider

• Customers received bills based on 34 days of usage, something that contradicted GBPC’s own internal policies.

• The fuel surcharge lacked transparency, and could be used to hide moves by GBPC to pass on its own internal inefficiencies, such as technical and non-technical system losses, to consumers. GBPC has subsequently reformed its fuel charge and tariff method.

When it came to estimated billings and meter readings, the PwC report noted that while GBPC customers were not supposed to receive three consecutive bills without their meters being properly read, in reality the system did not prevent this.

“Although the billing system has been configured to flag accounts that have received in excess of three consecutive estimated readings, this system control only raises a warning message instead of an error, and therefore allows the continued estimation on the account,” the report said.

PwC said some GBPC meter men noted down information manually, instead of keying it into their handheld devices, and these notes were not always passed on to the Customer Service Department.

Missing meter seals were not always noted, and there were

“instances” where GBPC’s meter men did not reset the demand reading on meters following a reading.

“We noted three meters from our field review which were physically present at three locations, but were not assigned to the said locations in the billing system,” PwC said.

When it came to dealing with inconsistent or seemingly inaccurate meter readings, the PWC report said GBPC billing clerks took different actions for the same type of problem.

“We observed instances where a service order should have been raised to investigate an exception and none was raised,” the report added.

“We observed instances where the billing clerks based their decisions on how to handle an exception based on their intimate knowledge of a particular customer.”

And PwC added: “From our review of a sample of customers who complained about high bills, and who appeared to have shown unusual consumption increases, we did not observe where GBPC personnel attempted to investigate the possible root cause of the increase.

“The conclusions arrived at by GBPC personnel were not based on an actual site visit to the location or discussions with the customer. Also, the meters were not pulled for testing.”

When it came to estimated power consumption, the PwC report said the GBPC system did not differentiate between actual and estimated meter readings, while “issues and anomalies” in the billing system - not identified by management - impacted “the integrity” of the estimation effort.

“We observed where the billing clerks deliberately applied an excessively high estimated consumption to a customer who had received consecutive estimated bills in an attempt to get a customer, who had not responded to multiple attempts to make contact, to come into the office,” the PwC report said.

To estimate consumption, clerks used the previous month’s billing or their own judgment. Investigating episodes where customers saw an 80 per cent of greater increase in their power bills, PwC said some spikes were due to the power company “underestimating consumption” for several months.

And, when it came to the fuel surcharge, PwC said the calculation should be improved to “restrict the level of losses arising from inefficiencies that are passed on to customers”.

It added that GBPC clients were being “charged for system losses to the extent there are overestimations of the budgeted billed kilowatt per hour kWh sales”.