News From Terre Haute, Indiana

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March 20, 2014

COLD SHOCK: Skyrocketing electric bills stun Wabash Valley residents

TERRE HAUTE — Their latest electric bill was three times what the family was used to in the winter months.

The family, which lives in Lakewood subdivision in Riley, received a bill for $929.93 from Duke Energy a few weeks ago. Thinking it was a mistake, the husband in the family called Duke and spoke with a company representative.

It was no mistake.

About one-third of the bill resulted from an additional charge of $301.98 for electrical usage from the previous two months. Because of the harsh winter, the family’s outdoor electric meter was not accessible, they were told, so the bills for those months had been estimated. As it turned out, the bills were estimated way too low, leaving the family owing hundreds of dollars in back charges this month.

“It was rather shocking,” said the mother in the family, who asked not to be named in the Tribune-Star for privacy reasons. However, she made her bill available to the newspaper.

Because of the size of the bill, the family asked Duke whether a payment plan could help alleviate the burden. Two Duke representatives, according to the family, answered: No, payment is due in full.

“There was absolutely no sympathy,” from the Duke representatives, the mother told the newspaper in a telephone interview Thursday. “The complete lack of sympathy was absolutely stunning.”

It is very unusual for a customer to receive two consecutive months of estimated bills, said Lew Middleton, a Duke spokesman. However, this winter was harsh and sometimes the company’s contracted meter readers could not safely access meters, he said.

The family in Riley did not buy that explanation. With the exception of early January, their meter was accessible all winter, the mother said.

Most importantly, had the family known the true cost of their electric bills, they would have found more ways to cut back on electrical usage, the mother said. By receiving two months of estimated bills that were far too low, the family had no reason to believe they needed to cut back drastically, she said.

“We felt we were really blind-sided,” she said.

When estimated bills are necessary, Middleton said, Duke uses a complex formula that takes into account a customer’s usage, the previous month’s bill and the weather. Sometimes the estimate is low, sometimes high, he added. If you receive an estimated bill from Duke, the bill will state “estimate.” If the actual amount you owed was greater, you will be billed the difference later, Middleton said.

“It’s important to remember that estimates are just that – estimates,” he said.

After speaking with the Tribune-Star on Thursday, Duke got a new representative in touch with the family in Riley and things went much better, the mother said. The representative was courteous and the company offered to stretch out the payments over a period of months, she said.

The family has never missed a Duke Energy payment, the mother said. When that’s the case, Duke will work with customers facing difficulty, Middleton said. If customers have a history of not sticking with payment plans, the company will be less flexible, he said.

“Duke will work with people,” Middleton said. “Turning off electricity is the very last thing we want to do.”

Middleton did not know how many Duke customers received estimated bills this winter, but the cold has clearly increased energy usage, he said, adding that even for families with gas furnaces, higher electric bills are likely because of the electricity needed to run the furnaces.

Some customers have called Duke with questions about about their estimated bills this winter, Middleton added. However, the vast majority of people calling Duke have been concerned about higher bills resulting from the cold winter, he said.

In the case of the family from Lakewood, its home relies on electric heat pumps for heating, meaning the impact of this winter was especially great. The house also has some 18-foot ceilings and lots of square footage, making it a prime candidate for high energy bills.

Higher bills from this winter will only partly reflect a 16-percent rate increase linked to construction of Duke’s new plant in Edwardsport, Middleton said. Those rate increases have been phased in every six months for about the past five years, he said. Only two semi-annual rate increases are still remaining, he said.

Customers facing high energy bills are encouraged to call Duke’s customer contact center at 1-800-521-2232 to determine whether they are eligible for one of the company’s extended payment plans.

Reporter Arthur Foulkes can be reached at 812-231-4232 or arthur.foulkes@tribstar.com

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