Tag Archives: utility expense management

These may seem like simple tasks but all require significant time and effort, as well as a trained eye to know exactly what to look for and when. In addition, dealing directly with utility providers can be challenging if you aren’t accustomed to navigating the processes.

1) Utility rate errors. You may not be charged the correct rate. Check the provider website and compare the posted rate schedule to your bill. If your building is multifamily and you are being billed a commercial rate, it is likely higher than a residential rate. Also, there are some rates based on occupancy. These occupancy numbers on occasion on are reverted to a factor of “1 occupant” if the numbers aren’t updated by the owner. The result is a rate increase. Rates may also be based on meter size. Find out sizes of your meters and compare with your bill to make sure it is reflected correctly. Contact the provider to find out if the meter associated with the account qualifies for a lower rate. If the building does qualify for a lower rate, you may be able to request up to a 5 year credit of the incorrect rate you were charged

2) Utility providers have charged the account taxes. In several states utility taxes aren’t allowed to be charged and yet, the provider charges them anyway. For example, Texas utilities  were charging tax on utilities. If you find taxes on your bill, contact your PUC or attorney to find out if the type of tax on your bill is allowed and how far back you can request a refund if applicable. If you’ve been incorrectly charged, you can estimate the taxes you’ve paid and send a request for a refund to the provider going back 5 years or more.

3) Meter read error. If your consumption has increased more than 15% over the previous month and the previous year, same month, you have a problem. First check to see if the previous read is the same as the end read last month. If not, there’s a definite meter read error. Next, assuming no known leak or work requiring water (like filling a pool, power washing, etc.) has been done, look for a leak. Check to see if the meter is running when the building is unoccupied or residents are likely sleeping. Have a qualified maintenance supervisor check the meter after midnight and take a video if the meter is moving. Utilities are quick to say there is no leak without thoroughly investigating. You will need proof either way. If no leak is apparent, request a re-read of the meter. Be sure to have an onsite maintenance team member there when the utility company re-reads the meter to verify their findings.

4) Estimated reads. Estimated reads can have a very negative impact on your budget by hitting you with an expense that is too high or low. Estimating too low may result in an immense true-up expense on a future bill. Stay vigilant about calling the provider and requesting a “true read.” The provider may be having trouble accessing the meter. Schedule an appointment and meet the meter reader to ensure your read gets correctly trued up.

5) Erroneous deposits. If you are charged a deposit, always investigate it before you pay. Even if this is a new property you may not need to pay a deposit if the same owner name has credit in excellent standing with the utility provider. Call the provider and they will look up the credit standing for the legal entity name. If you can’t get the deposit waived, find out how long the deposit hold will be and make a calendar note to reach out for a future refund.

6) Charging late fees during the grace period. If you have a late fee on your bill, check your records to see if you paid by the due date. If you have proof of the payment date, call the provider and request the late fee be removed.

7) Multiple bills for the same account/same period. If you receive two or more bills for the same account in a bill period, call the provider for an explanation. Unless the dates line up perfectly, there’s a duplicate bill issue to be credited.

8) Bill use/cost duplicate. The use or cost amount of the bill is exactly the same as the previous bill. Unless this is a flat rate bill versus a bill based on actual consumption, it may be an estimated bill. Call the provider and ask for an actual consumption based bill.

9) Overlapping bill periods. If the beginning or end dates are the same as the previous bill overlap you may be charged twice for those days. Call the provider and request a credit for the overlapping days.

10) Zero usage on bill. The meter is likely not working or the provider’s process isn’t catching the read and charging you. Don’t let this for more than one billing period or you will eventually receive a large true up bill.

Don’t let your revenue go down the drain or out the window! By not auditing utility bills, many portfolios are paying hundreds or even thousands of dollars in extra fees and incorrect rates. It’s worth your time to get to know your bills or assign a skilled analyst to manage it for you.

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New Construction Utility Expense Management

Getting Your Asset Off to a Good Start from the Ground Up

What if on Day One of the earth moving on your new community you didn’t have to touch the utility aspect of the site?  And, if you wanted to understand what accounts have been created you only need to go to one place to see everything – from what utilities are set up to your current spend? And, what if you could outsource doing everything from powering up the accounts for the trailer right down to installing the last meter needed at the lowest, possible rate available?

Introducing an Energy Manager to the construction team mix in the planning stages will help establish a strong utility expense management structures that carries throughout the life of the investment.

Finding the right person requires a basic understanding of the scope of work and practical benefits. They must have the knowledge to educate you on technology options, as well as the fine details associated with this complex service.

Anyone involved with new construction has experienced the hazards, frustrations, and hair pulling while trying to understand utility bills.

Benefits of Employing an Energy Manager from Day One: 

  • A controlled set up of utility accounts at the right time with the correct, lowest rate available is obviously the best case scenario. Let’s face it, construction companies have the accounts set up at the last minute, rarely worrying about whether the rate is correct. This is a temporary gig for them. You will manage or own the asset long term. An Energy Manager can handle set up based on the construction schedule, on time, at the right rate. No frantic phone calls and unnecessary delays to the project. And, if an issue arises, the Energy Manager sits on the phone with the utility company – not you.
  • The centralization and accessibility of data in an energy management software system is imperative. Imagine no more digging through piles of paper bills trying to find the one number you need. Also, with data being captured correctly and in detail, the ease of accessing it for monthly variance analysis and annual budgets is a breeze. Reports on usage, rates, expenses and exceptions is possible. And, so is making data-driven decisions.
  • Streamlining of A/P processes and the alleviation of work for the accounting and construction, teams, i.e., the rubber stamping of bills versus skilled, audit reviews before payment. For example, the initial paperwork to create accounts, important continuous service agreements and the creation of a standardized process with one point of contact for construction and management can all be handled by an experienced energy manager.

A central point of contact smooths the transition from construction to management with business rules dictating the allocation of bills to be paid based on certificate of occupancy acceptance:

  • Once operational, the Energy Manager continues to add value by eliminating work load for management and expertly handling all your utility needs:
  • Continuous bill auditing using defined metrics. Utility providers never stop making mistakes and rate errors or leaks left unnoticed will cost you big if undetected. Issue resolution on behalf of management is also a critical component. Early detection of problems, such as leaks, and quick resolution are vital to quality utility bill management.
  • Negotiation of procurement contracts is more than just calling brokers and looking for the lowest price. There are dangerous pitfalls of low kWh/high extra fees. A seasoned Energy Manager is crucial to avoiding costly mistakes. Important steps will include reviewing historical usage patterns for your portfolio, aggregating load to gain maximum deal, determining hedging options, scrutinizing hidden fees, finding reputable brokers to contact, manage and negotiate the proposal process, and ultimately present the best options for your consideration. Once a provider is chosen, the Energy Manager maintains and manages the contracts going forward.
  • Failure to connect management and billing. This shouldn’t be a manual process completed on site. Management teams are busy and will miss opportunities to capture all failures to connect problems. An Energy Manager uses a software program designed to capture all failures to connect based on rent roll data versus bill service periods. These would then become exceptions and billed out with an additional penalty fee where allowable by law.
  • If the data is centralized, a budget should be created at an account level based on historical usage patterns, current rate and researched increases triggered to occur in the month forward when actually taking place. Further, anomalies from the previous year, such as leaks, credits or true ups should be scrubbed so the next year’s budget isn’t skewed. This is not the common practice of last year’s expense plus 3-5% increases. It takes a seasoned energy management veteran’s depth of knowledge in utilities to create a realistic budget.

In conclusion, efficient and effective utility bill management is a reality. An Energy Manager will make sure your management associates never open another utility bill envelope.  They will save you time and money and likely make you even more money. Paying a utility bill can cost you upwards of $15 per bill to process. Considering that utilities comprises 16% of your expenses, finding a good energy management program should be a top initiative and not an afterthought.

Minol Announces the Release of the Minomess 130 Polymer

Lighter weight and more cost-effective water submetering solution for optimal
Utility Expense Management

Addison, TX – June 24, 2015 – Minol announced the release of the Minomess 130 polymer water meter today at the National Apartment Association’s Annual Conference. The Minomess, specifically designed for multifamily and commercial usage, provides owners and managers with a cost-effective solution for managing their utility expenses.

In the past decade, U.S. cities have seen a trend toward higher water bills. A few of the driving factors are excessive consumption, increasing water costs, decaying infrastructures and droughts. According to a recent Circle of Blue survey, the price of residential water service in 2015 is uMinomess Polymerp 6 percent in 30 major U.S. cities; a 41 percent rise since 2010. With utilities accounting for 15% or more of an owners’ overall expense, submetering has become a necessity in sustaining positive cash flow throughout the portfolio. Three states, Texas, Georgia and California, require submetering on new construction with more states likely to follow suit.

“Studies show that submetering may result in a 10-26 percent reduction in that utility’s consumption,” said Corey Hauser, Vice President of Meter Data Management for Minol. “Installing a submetering solution not only increases property value and revenue but promotes conservation by measuring individual consumption and proactively identifying leaks. The Minomess polymer gives owners an even more cost-effective metering solution to maximize the value of their assets.”

The Minomess polymer meter is a single-jet meter for cold water applications. The polymer meter body provides a lighter weight and more cost-effective submetering option. The Minomess polymer and Minomess brass for hot or cold water application are both ANSI/NSF 61 certified and comply with AWWA C712, ISO 4064 and G13IT19001-ISO9000 performance standards.

Minol’s in-house Meter Data Management Team successfully maintains 1.5 million hardware components nationwide by proactively managing daily meter health for water, gas and electric systems. Traditional AMR systems are designed just for meter reads. Minol’s MDM solution provides two-way data to insure accurate data which results in accurate billing.