Utility construction charges

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electrofelon

electrofelon

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Cherry Valley NY, Seattle, WA
Ok, I've got to ask this. Is it just me or are utility construction charges like all over the place? As in you never know what its going to cost before you get that invoice - maybe its free, maybe its 20 grand? I am mostly referring to light/mid sized commercial. Resi is usually straightforward in my experience. A few examples:

1. New 200A 277/480 service (a second service to the building). Was told it would be $1200, ended up being $16,000.
2. New 800A 120/208 service: free
3. Upgrade service from single phase to 400A 120/208: was told it would be free, just got a bill for $5,000.

No itemization on any of these that had charges. Granted these were three different utilities with different tariffs, but am I the only one that feels like you might as well pull a number out of a hat when asked what the utility will charge? I pretty much tell clients "it might be free, it might be 20k."
 
Sounds about right. Cue the Forest Gump soundtrack Dealing with the utility company is like a box of chocolates...

I had to spend $1500 on my own house when I moved my service from overhead to underground to have engineering come out and put a wooden stake with orange flagging tape in the ground next to the power pole and tell me that the ditch needs to go to here.
 
Payback period for the utility can factor in there also.

Need for somewhat high capacity for a particular load means they need to make the investment to be able to supply it, but if that load only runs for limited time may not really sell much energy so payback on investment is longer - probably want customer to offset more of the cost.

Now build same service but expected to have a daily higher demand from it and payback period is less, may not charge as much or may even not charge at all to supply this service.
 
kwired said:
Payback period for the utility can factor in there also.

Need for somewhat high capacity for a particular load means they need to make the investment to be able to supply it, but if that load only runs for limited time may not really sell much energy so payback on investment is longer - probably want customer to offset more of the cost.

Now build same service but expected to have a daily higher demand from it and payback period is less, may not charge as much or may even not charge at all to supply this service.
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That all went down the tubes 30 years ago when the utilities were deregulated. The utility construction costs were strictly based on future electrical revenue
 
cdslotz said:
That all went down the tubes 30 years ago when the utilities were deregulated. The utility construction costs were strictly based on future electrical revenue
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With investor owned utilities probably true. We still have publicly owned non profit electric utilities here. They do what they feel is fair and best for keeping a good system and also fair to the customers who technically are all owners of the utility. Yes some things have changed over the years when it comes to what the customer pays directly for, but they are still pretty reasonable with what their procedures/policies are.

Non profit doesn't necessarily mean they operate on the edge of bankruptcy, but excess receipts are big bonuses taken by any investors, instead they are reinvested into the operation of the utility.
 
electrofelon said:
Ok, I've got to ask this. Is it just me or are utility construction charges like all over the place? As in you never know what its going to cost before you get that invoice - maybe its free, maybe its 20 grand? I am mostly referring to light/mid sized commercial. Resi is usually straightforward in my experience. A few examples:

1. New 200A 277/480 service (a second service to the building). Was told it would be $1200, ended up being $16,000.
2. New 800A 120/208 service: free
3. Upgrade service from single phase to 400A 120/208: was told it would be free, just got a bill for $5,000.

No itemization on any of these that had charges. Granted these were three different utilities with different tariffs, but am I the only one that feels like you might as well pull a number out of a hat when asked what the utility will charge? I pretty much tell clients "it might be free, it might be 20k."
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#1&#3 were just plain stupid on the staker or construction rep, (they aren’t engineers) part for not being able to quote costs closer to actual. They probably spoke out of turn and were overruled by the engineer in charge. Apparently they need more training...

#2 is in line.
We would have charged depending on future projected load vs payback. It costs to keep the lines up in the air. Also maintenance costs are extremely high for utilities. After all, out vendors sell very few of the products we purchase, so heir profit has to be made on fewer products.

We are replacing four transformers this year and adding some 115kV breakers. That money has to come from somewhere. The margins from kWh sales can, but there has to be some contribution in aid from the customer sometimes.
 
kwired said:
With investor owned utilities probably true. We still have publicly owned non profit electric utilities here. They do what they feel is fair and best for keeping a good system and also fair to the customers who technically are all owners of the utility. Yes some things have changed over the years when it comes to what the customer pays directly for, but they are still pretty reasonable with what their procedures/policies are.

Non profit doesn't necessarily mean they operate on the edge of bankruptcy, but excess receipts are big bonuses taken by any investors, instead they are reinvested into the operation of the utility.
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REA
Cooperatives...
 
GoldDigger said:
And the small number of municipalities that operate their own utility. Out here in CA those depend on locked in contracts for cheap Federal hydro power.
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Couple of munies here also.. those guys need all the money they can get...
 
And it's amazing that most of the solar-installer sales robocalls 'round here start with "Lower your PG&E bill"...

My monthly PG&E bill last summer was maybe $14 (to make hot water :D). The call centers don't bother to check that, hmm, just in my area Palo Alto, Santa Clara, Alameda, and Sacramento all have municipal electricity; rates are often 25% lower than PG&E and they kick back millions to the owner city.
 
zbang said:
And it's amazing that most of the solar-installer sales robocalls 'round here start with "Lower your PG&E bill"...

My monthly PG&E bill last summer was maybe $14 (to make hot water :D). The call centers don't bother to check that, hmm, just in my area Palo Alto, Santa Clara, Alameda, and Sacramento all have municipal electricity; rates are often 25% lower than PG&E and they kick back millions to the owner city.
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That is what I am seeing with the small town municipal power providers, they are still reasonable rates but also earning extra funds and returning them to the city for special needs here and there.
 
So I asked the rep for clarification on my #3 in the OP and I heard back today. I dont remember exactly what he said originally, but it was something like, "we will provide 120/208 three phase on our dime." (original service is 200A single phase). The bill I got had the following (vague) line items:
1. standard: $3049.57
2. extra ordinary: $1638.27
3. amp fee: $398.95

This was the response I got today

"...As far as the cost breakdown; the charges only include labor for installing all of the conductor needed to energize the service, and setting the meter. There are no charges for installing transformers, as promised."

Ok whatever. I'm not mad, its all kinda comical really. I know the client wont give me any stink about it, fortunately.
 
electrofelon said:
So I asked the rep for clarification on my #3 in the OP and I heard back today. I dont remember exactly what he said originally, but it was something like, "we will provide 120/208 three phase on our dime." (original service is 200A single phase). The bill I got had the following (vague) line items:
1. standard: $3049.57
2. extra ordinary: $1638.27
3. amp fee: $398.95

This was the response I got today

"...As far as the cost breakdown; the charges only include labor for installing all of the conductor needed to energize the service, and setting the meter. There are no charges for installing transformers, as promised."

Ok whatever. I'm not mad, its all kinda comical really. I know the client wont give me any stink about it, fortunately.
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Don't you love it when you ask anyone (not just a POCO rep) what something is going to cost you and they tell you what it is not going to cost and then surprise you later with billing for things that never were mentioned initially? I wish I could get away with that, I usually try to let a client know worst case what the cost might be and tell them it is easier to convince them the total is less than to try to justify why it is higher than initially expected.
 
kwired said:
Don't you love it when you ask anyone (not just a POCO rep) what something is going to cost you and they tell you what it is not going to cost and then surprise you later with billing for things that never were mentioned initially? I wish I could get away with that, I usually try to let a client know worst case what the cost might be and tell them it is easier to convince them the total is less than to try to justify why it is higher than initially expected.
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Yeah from now on, I am going to just ignore any estimates or verbals from POCO and not even tell the client anything until the actual official bill comes.

I dodged a bullet with my #1 in the OP, that was a few years ago. The rep misunderstood what I was doing (Sounded like her English wasn't that great) Fortunately the client forgot I had said POCO would charge $1200 and never said a thing about it and paid the $16k!
 
I had a resi client who wanted to put in a pool. Her service drop crossed the proposed pool. Due to the small lot size and tight quarters, the drop needed to be moved underground with a new meter and new conduit to the panel. We signed a contract and I got to work interfacing with the POCO on their charges. It took three weeks and many calls to the engineer to finally get a written quote of $5000. The client decided that she didn't want the pool that much and cancelled. I ended up returning the entire deposit and didn't get any compensation for all the hours I spent estimating, designing, and POCO interfacing. I didn't anticipate it would be so much time and didn't write any clause in the contract to cover it.
 
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