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Utah natural gas consumers could end up paying as much as $621,000 to rectify problems Questar Gas Co. caused when it improperly set the electronic transmitters on gas meters installed at 517 of its customers' homes and businesses. Full story published August 20th, 2008 by the Salt Lake Tribune. A later story now posted by KSL Channel 5.
The issue, as previously discussed on March 28th and again on April 18th, first surfaced when Questar discovered that the transponders (also referred to as transmitters) on 400 homes and 117 businesses were recording only about half of the natural gas that was used. Questar estimated each affected customer owed an average of $1,200, and set out to back bill each one. The transponders allowed company trucks driving through residential neighborhoods and business areas to automatically record each dwelling's natural gas consumption.
As a result, dozens of those Utahns faced with large, unexpected gas bills filed complaints with the state arguing that the problem was Questar's fault and that the gas company should bear the responsibility. The Utah Public Service Commission has told Questar to delay collection until the matter is decided. The Division of Public Utilities investigated, and now has compiled a report, which is apparently not yet available to the general public.
In its report, the Division of Public Utilities first recommends Questar be allowed only to back bill customers for up to six months instead of the two years the company believes is warranted. Under existing Utah Public Service Commission rules, Questar can seek back payment for up to two years if there was a billing error, but can only seek back payment for up to six months if the problem was a meter malfunction. Questar is maintaining that it was a billing error although the transponder malfunctioned. Apparently, Questar does not consider the transponder an official part of the meter.
Then they address the monetary amoung. According to their report, six months of back billing, in the absence of any further [Public Service] Commission action, will result in $621,000 remaining uncollected from the under-billed customers. This amount would eventually be paid by Questar's other customers. However, about $98,000 that is at risk to Questar would remain uncollected and be a loss to the company. The division, though, goes on to indicate that it believes it would be appropriate for the PSC to enter an order requiring that Questar pick up at least some of the $621,000 shortfall that all of the company's customers otherwise would be faced with paying.
Questar said it still is studying the division's report. "We agree with the report to the extent that it indicates the company has done everything it can to resolve this problem," Questar spokesman Darren Shepherd said. Questar has argued that by trying to go back two years to correct the undercharges from its affected customers it is trying to collect only what is due so the money can be used to help lower rates for everyone else. "This really looks like it is shaping up to be a six-month [back billing] issue or a 24-month issue," Shepherd said.
The Committee of Consumer Services, whose job it is to serve as the voice for Utah consumers and the owners of small businesses in utility regulatory matters, also is weighing its response to the division's report. "We will be providing the PSC with some different recommendations," said Michele Beck, the committee's director. In April, Beck stated that "utilities are not automatically entitled to recover all costs from ratepayers for unjustified mistakes."
Questar has already instituted two rate hikes this year, adding an average of $163 per year to a customer's bill.
The Public Services Commission has scheduled hearings on Questar's back-billing issues Oct. 22-23. Public comment will be accepted from noon to 1:30 p.m. and 4:30 p.m. to 6:30 p.m. Oct. 22 at 160 E. 300 South, fourth floor, in Salt Lake City. Clearly, Questar needs to share more of the pain, since it was their error.