Unaccounted for energy keeps city from earning some additional revenue
Published 8:27 pm Thursday, March 22, 2018
Washington “lost” at least $978,000 in revenue during fiscal year 2016-2017 because of unaccounted for kilowatt hours.
It’s not lost revenue, per se, but it’s money the city won’t realize because those kilowatt hours aren’t accounted for because they are not being recorded by a meter or other monitoring device.
The Washington Electric Utilities Advisory Board discussed that issue during its meeting Wednesday night, with the objective of helping city officials find ways to keep such revenue loss at a minimum. According to the latest audit of city finances, there were 16.3 million in unaccounted for kilowatt hours during fiscal year 2017, which ended June 30, 2017. The city pays about 6 cents per kilowatt hour when it buys power at a wholesale rate. Multiplying the 16.3 million unaccounted for kilowatt hours by that 6 cents shows the city “lost” nearly $1 million in revenue in fiscal year 2017. That amount is higher if the city’s residential, commercial and industrial kilowatt-hour rates are used as the multiplier.
The city’s latest audit report shows the city bought 291,738,820 kilowatt hours of power during fiscal year 2017, selling 275,360,200 of them, leaving a difference of 16.3 million. Unaccounted for kilowatt hours also is known as unaccounted for energy. It’s not unusual for an electric utility to experience unaccounted for kilowatt hours. Faulty meters, theft of power, billing errors, meter-reading errors, lack of tree trimming and other factors such as power being distributed over long distances result in unaccounted for kilowatt hours.
“Unaccounted for energy is energy that is not captured on an hourly basis through some type of metering device or the absence of a metering device and exists through normal operations of the utilities business,” wrote John Taylor in a document explaining unaccounted for energy for the Electric Reliability Council of Texas.
“Folks, this is probably the most interesting conversation we’re going to have the whole we’re up here Unaccounted for kilowatt hours can mean a lot of stuff and a lot of money and at a lot different times,” board Chairman Stewart Rumley said. “What I would think we need to do is try to get a grasp of what constitutes unaccounted kilowatt hours and what can we do to try to lower that number some. It’s not going to go away.”
Bob Thomas, with Progressive Engineering, said unmetered power usage such as street lights the city provides is responsible for some of the unaccounted for kilowatt hours. Jeff Clark, the city’s electric utility director, said there are about 2,500 street lights (not private yard lights) in the city.
Thomas said Washington’s rate of unaccounted for kilowatt hours is about 6.4 percent. The average for all cities (that sell electricity) across the state is about 7 percent, Thomas noted.
Rumley said the city will never be able to completely prevent unaccounted for energy, but it needs to find ways to minimize unaccounted for kilowatt hours so the city realizes as much revenue as it can from the power it sells.