Press Release

PUC 2015-16 Management Audits, Efficiency Investigations Resulted in $18+ Million in Savings for Utilities

Published on 9/16/2016

Filed under: Electric Gas Water and Wastewater

HARRISBURG – According to a new report released by the Pennsylvania Public Utility Commission (PUC), recommendations included in various utility audits conducted during the past year have helped regulated utilities save in excess of $18 million.

The Commission voted 5-0 to publish its 2015-16 annual report on PUC management audits (MAs) and management efficiency investigations (MEIs), which work to identify efficiencies and savings for utilities, including potential improvements in operations, service reliability and safety programs. The reviews are part of the Commission’s ongoing efforts to ensure that public utility rates are reasonable.

Chairman Gladys M. Brown commended the staff of the PUC’s Bureau of Audits for their efforts. “This important work results in real savings for utilities, and in turn, for their customers,” Chairman Brown said.

During Fiscal Year 2015-16, the PUC Bureau of Audits released the MAs of Pennsylvania-American Water Company and the Philadelphia Gas Works. These audits identified 114 improvement opportunities, with 112 of those opportunities being accepted or partially accepted by these utilities. The quantifiable net annual or recurring benefits from implementing the recommendations in the MA and MEI reports were $12.7 to $14.6 million in annual or recurring and $3.7 million in one-time savings.

More specifically, the PUC audit staff found that Philadelphia Gas Works could realize savings ranging from $6 to $7 million per year by continuing to take steps to reduce their gas supply assets, along with an estimated $1.8 million in annual savings by exploring alternatives for fulfilling internal audit requirements. Items highlighted in the audit of Pennsylvania-American Water Company include savings of up to $3.2 million per year by reducing non-revenue water levels, along with one-time savings of $2.1 million by fully optimizing its inventory function.

PUC staff also released MEIs of Duquesne Light Company and the UGI Utility Group. The MEIs showed that 23 of the 40 total recommendations from prior MAs that were reviewed had been effectively implemented and that the companies also had taken some action on the 17 remaining recommendations.

A total of 24 follow-up recommendations were made, with the companies accepting or partially accepting all of them. More specific information on each of the original audits and investigations can be found at the Commission’s website.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities; ensures safe and reliable utility service at reasonable rates; protects the public interest; educates consumers to make independent and informed utility choices; furthers economic development; and fosters new technologies and competitive markets in an environmentally sound manner.

For recent news releases and video of select Commission proceedings or more information about the PUC, visit our website at www.puc.pa.gov. Follow the PUC on Twitter – @PA_PUC for all things utility.  “Like” Pennsylvania Public Utility Commission on Facebook for easy access to information on utility issues.

# # # 

Docket No.: D-2016-2552671

 

Contact:

• Nils Hagen-Frederiksen
  Press Secretary
  717-418-2701
  nhagen-fre@pa.gov