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Expert tells city to take a “very active” role in SEPA rate increase

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Local meter readers honored for exemplary service

By Alice Du Pont

For more than 2 years Quincy residents and city commissioners questioned the amount of money generated from electricity, whether the money was enough to operate profitably and if meter readings were accurate.

To get answers, electric consultant Lloyd D. Shank Jr., of Power Services, Engineering & Management Services, was hired.

Shank presented his comprehensive report to the city commission last Tuesday night.

"We examined the city's monthly financial reports, annual budgets, contracts with suppliers and bond covenants. Based on historical trends evaluated, the net trends should yield a net surplus by the end of the year," Shank said.

He also evaluated the fuel adjustment process and said the present process, which was authorized by the city, is fair. The cost, Shank said, can never be truly accurate because Progress Energy bills the city on one date and the city bills its customers on another date.

"The mismatched billing periods and actual losses between the city's wholesale bill and the retail bills sent to customers prevent accurate recovery of fuel expenses of the time we measured for the fiscal year," Shank said.

He said that Quincy's electric system losses are in line with other system losses throughout the state. He suggested that the losses could be "slightly" improved with continued management oversight.

For the past 2 years the performance of the meter readers came into question regarding whether they were reading the meters accurately, if at all. Shank said he recalled one night, during a commission meeting, that a customer told commissioners her meter had not been read.

"In our opinion, the city can be assured that all meters are being read and recorded accurately. The city uses a handheld computer system that time stamps each meter reading. If the reading entered disagrees with a computer-calculated consumption, the meter reader is notified," he said.

Shank said the meter readers have to be "very, very smart" to enter a false reading because they don't know the actual previous reading, therefore the answer cannot be faked. Supervisors receive error reports and exception reports after each reading that is not in line with the computer-generated estimate.

When the error reports are entered, Shanks said, a supervisor sends a reader back for a re-read. As an added precaution, monthly meter reading error rates are now being reported.

"Therefore the overall quality of meter readings is dependent on the attention given to the exception reports by management," Shank said.

"He confirms what we have known all along and that is that our meter readers are doing a great job," said Ann Sherman, the city's customer service director. She also presented the three meter readers, Deandre Moore, Mark Hamilton and Shelia Upshaw plaques of appreciation when Shank completed his report.

Shank also examined the city's contracts with Progress Energy and Southeastern Power Association and recommended that the city maintain a "very active" role in the evaluation and examination of the forthcoming SEPA rate increase.

"We believe that SEPA will remain an advantage for the future even with the added proposed costs. The increase will have a profound impact on the city's costs and questioning the SEPA justification for the rate increase may gain you considerable savings or at least delay the impact of the increase," Shank said. According to Shank, Quincy's electric system average losses are at 6 percent. This percentage is within the normal range for municipal electric systems. He added that the city has the potential to improve its losses by at least two percentage points.

Jack McLean, city manager, assured commissioners that his plan is to work diligently toward improving those losses.