What is a Utility Rate Analysis?

An overhead expense is defined as a cost to run a business. One of the biggest overhead expenses on any property is none other than the utilities. But what if we told you that there’s the potential for up to tens of thousands of dollars in savings on this overhead expense each year? That’s where a utility rate analysis can help. Here’s what you need to know about one:

What is a Utility Rate Analysis?


Don’t get a utility rate analysis confused with an energy audit. Though the two terms are sometimes used interchangeably, they’re not the same thing. An energy audit is a practice of determining a residential or commercial property’s energy efficiency, usually performed as a means of reducing a facility’s energy usage. Conversely, utility rate analysis is the practice of assessing a residential or commercial property’s utility bills. They’re often done to detect any errors or irregularities, assess different rate options, or take other means to reduce a facility’s utility costs without impacting the operations of the property or the lifestyle of anyone living or working in it.

Think of the difference this way: Energy audits are performed with the end goal of increasing energy efficiency. Utility rate analyses are performed with the end goal of decreasing overhead utility costs.

How Common Are Utility Errors?


Simply put, they’re much more common than you might think – and depending on the size of your facility, errors or lack of appropriate adjustments could cost you thousands of dollars per year. Common errors include the likes of incorrect sales tax, incorrect rate codes, or pass-through charges. The larger a property and the greater its energy usage needs, the more potential there is for saving following a utility analysis.

Understanding Utility Bills


Let’s face it – it can be difficult to even take the time to look over a utility bill, let alone understand it. In fact, many property owners and property managers simply pay the bills or arrange for automatic payment of their bills without even taking a glance at the statement. Noting this, it’s easy to miss problems. And even property managers that do review their bills might not understand them in the same way that a professional can. There’s a certain level of expertise involved in assessing utility bills, which is why it can make sense to work with a professional on an assessment. At Green Line Rates, we’ll carefully review rate charges and work to get you the best rate possible. We also have a keen eye for compliance and billing errors so we can address issues with utility companies promptly.

A utility rate analysis typically assesses three different parts of bills for errors. We’ll get into more of the specifics in the following sections:

Electric Utility Rate Analysis


For many properties, electricity is the leading utility cost – and for good reason. Electricity literally powers just about everything in a property. Your property relies on it to keep the lights on, keep key equipment and appliances running, and more. The electrical bill is also one where many cost savings can be realized during a rate analysis, largely because there are so many different electrical rates that could apply to your property and its classification as well as its usage. Simply selecting the correct electric rate for a business could save up to several thousand dollars per year.

Gas Utility Rate Analysis


From HVAC units to kitchen equipment, there’s likely a fair number of appliances within your facility that run on natural gas. And while you may think you might not be able to realize the cost savings following a utility rate analysis that you can with electrical, an assessment can offer major money-saving opportunities. The biggest errors that we often see when assessing gas are classification errors and meter errors. Here are some of the things we take a look at when it comes to gas rates:

  • Small volume vs. large volume rates
  • Firm services vs. interruptible service rates
  • We even take a look at options to buy natural gas on the market.
  • Do you burn alternative, more environmentally-friendly fuels? You may be eligible for a discount on your natural gas rate via the economy-based gas pricing principle.

In some cases, by adjusting charge rates, we’ve been able to save clients nearly $20,000 per year on their gas bills. We can also suggest installing new equipment that can provide a route to changing bill rates. While such equipment often comes with an upfront cost, it’s typically easily paid for in time due to the savings that a property can experience as a result.

Water Rate Analysis


Finally, we can also take a look at your water bill. While this tends to be a more basic bill, there are a few ways that we can go about achieving cost savings. One way is to make sure that your water meter is sized appropriately. This is important because your water charge tends to depend on it. In addition to your water charge, water bills also consist of a sanitary sewer charge. However, not all water that leaves a property goes to the sewer. Some water may go to lawn sprinklers or cooling towers. Any water that does not go to the sewer may be eligible for a credit on your bill. We can make sure that you’re rightfully getting it.

Contact Us Today


For more information on a utility rate analysis and to begin the process of having your property’s utility bills assessed, contact us today. Our five-step plan consists of an initial kickoff, access to utility bills, analysis and review, a detailed presentation of utility savings, and then delivering the savings. When we’re done, you can rest assured that we’ll have found any savings opportunities. And if we don’t find any savings opportunities, you won’t be charged. Contact us today for more information and to get started.