Using A Utility Audit

Prevent over-billing with this financial analysis

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No need to cringe, utility audits have nothing to do with taxes or Uncle Sam. In fact, this kind of audit is one every business owner should welcome because it helps keep your money where it belongs–in your pocket.

Utility auditing is a process by which a trained professional compiles a historical portfolio of your bills and assesses their accuracy and suitability for your business. “We review our customers’ review records to see if they are being overcharged or incorrectly billed,” says Tad Deriso, a senior consultant for Engineering Associates Inc. (EAI), a facility management consulting company in Atlanta.

EAI recovered $24,000 for the owner of a tenement apartment because the Public Service Co. in North Carolina was calculating energy consumption based on residential rather than commercial rates. Errors like these rob business owners of tens of thousands of dollars every year and most are unaware of it, says Marsha Miller, co-publisher of the Refund Paces, a directory of refund auditors in Southern California. Miller, who has been working in the utility auditing business for seven years, has recovered as much as $700,000 for some clients. “A third of the bills we review here in California have billing errors and 85% are billed incorrectly,” she says.

Billing errors can occur when figures are miscalculated or you have been double-billed or charged for services you haven’t used. In these instances, you would be entitled to a refund. But don’t count on utility companies to protect all your interests. These firms do not conduct professional audits. They look over your basic billing information periodically, but even when they send out notices saying, “We’ve just reviewed your account,” you can be certain it wasn’t for the purpose of saving you money. With that in mind, keep a sharp eye on all of your bills each month and question areas where you feel you’ve been overcharged.

Miller says most auditors charge no money in advance and take a percentage (sometimes 50%, depending on the region) of your refund check. Avoid dealing with companies that charge advance fees or want to lock you into multiyear contracts to audit your bills. Miller warns that these are rip-offs. To locate an auditor m your area, contact the Refund Pages at or call 888-282-6100.