We find mistakes, overages, mis-charges and just plain poor math on commercial utility bills all of the time. When we set up an account for a CLASS 5 client, we scrutinize each of their electrical and natural gas bills, and far too often we find that there is money to be saved simply by better understanding what they are being charged for. Commercial bills are different from household bills, and if the person paying yours hasn’t done a review of your utilities recently, one should be done today.
Here are 4 things businesses need to know about their utility bill:
1. Non-profit organizations such as schools and churches should not be charged sales tax. If your organization is tax-exempt, but you have been paying tax on your electric or gas bill, you have may have hundreds, or thousands, of dollars in refunds entitled to you. If you have a tax exempt status, review your bills for a tax line. If you are being charged, you have the right to appeal and be refunded.
2. Commercial businesses get charged for electric demand. This is a charge that is only found on business accounts, so if you look for it on your residential electricity bills, you won’t find it. Basically, since electricity can’t be easily stored, utility companies must be ready at any time to supply you with as much electricity as you need. You pay for this availability through a “demand” charge. Demand measures your peak use throughout each billing period, and the more you use, the more you pay. By reducing your demand, you can greatly reduce your monthly electric bill.
3. Work with your utility representative to check the rate schedules that they offer, and make sure you are on the right one. Although they can be difficult to understand, you may find an opportunity to switch and save. For example, your utilities may offer a “time of day” rate or curtailment discounts. Electric companies may offer curtailment discounts to large buildings in order to help conserve energy in times of extreme use. Generally, these happen during times of extreme heat, when many more people are using electricity for cooling purposes. If your organization is eligible for curtailment, you agree to reduce energy use during times of high need in exchange for a break on your rates. This may mean changing the temperature on your AC, turning out some lights or shutting down large equipment for a short period of time in order to allow that electricity to be allocated somewhere else.
Natural gas companies may offer curtailment discounts too . For example, if you have a boiler that can run on both natural gas and fuel oil, you may be eligible for a discount from your natural gas company if you are willing to switch to fuel oil during very cold days when the supply can’t keep up with the demand.
4. Be sure that the meter numbers on your utility bills match up with the meter numbers at your building. Do this by field checking your meter numbers to be sure they match up with your bills. Meters break, meters get changed, buildings are bought and sold – if your utility provider has incorrect meter numbers associated with your bill, you may be paying for energy you aren’t even using, or paying a fee for a meter that isn’t even being used. Each year, designate someone to locate each of your meters, ensure they are working properly and that the numbers match up. If you find one that is wrong, contact your utility provider immediately and be sure it’s corrected.
Bottom line – make the utility company your friend! If something shows up on your bill that doesn’t look quite right, pick up the phone and call them. Make sure you understand each line item of your bills so that you can learn how to reduce use and dollars. And finally – do a thorough review of your rate schedules annually. If your utility companies have made any change to their rates, you may find that there are other options available that can save you money.
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