Questar potentially could pay a lot less for its blunders - about $98,000.
The scenario where consumers pay (about 70 cents for each of Questar's 875,000 customers) and the gas company more-or-less skates was spelled out in an investigative report on the messed up meters filed recently by the state's Division of Public Utilities.
The division was asked by the Public Service Commission, the state's top utility regulatory authority, to look into the issues surrounding Questar's bid to back bill those 517 customers more than $900,000 for up to two years for natural gas they had used but their meters didn't record.
For Robert Slattery of Salt Lake City, one of the Utahns who the company surprised by back billing him earlier this year, it is appalling that someone other than Questar might end up paying to fix the company's mistakes.
"They caused the problem, and they should pay for their errors," he said. "It was never my responsibility to make sure their equipment was running properly."
Questar started installing transmitters on its gas meters attached to its customer's homes and businesses 10 years ago. The transmitters, technically known as transponders, allowed company trucks driving through residential neighborhoods and business areas to automatically record each dwelling's natural gas consumption.
Late last year, the company discovered the transmitters on 400 homes and 117 businesses, were recording only about half of the natural gas that was used. Questar estimated each affected customer owed an average of $1,200, and set out to back bill each one.
As a result, dozens of those Utahns faced with large, unexpected gas bills filed complaints with the state arguing that the problem was Questar's fault and that the gas company should bear the responsibility. The PSC has told Questar to hold off on trying to collect until the matter is decided.
In its report, the Division of Public Utilities recommends Questar be allowed only to back bill customers for up to six months instead of the two years the company believes is warranted.
"However, six months of back billing, in the absence of any further (Public Service) Commission action, will result in $621,000 remaining uncollected from the under-billed customers," the division's report said. "This amount would eventually be paid by Questar's other customers. . . . However, about $98,000 that is at risk to Questar would remain uncollected and be a loss to the company."
The division, though, goes on to indicate that it believes it would be appropriate for the PSC to enter an order requiring that Questar pick up at least some of the $621,000 shortfall that all of the company's customers otherwise would be faced with paying.
Questar said it is still studying the division's report.
"We agree with the report to the extent that it indicates the company has done everything it can to resolve this problem," Questar spokesman Darren Shepherd said.
Questar has argued that by trying to go back two years to correct the undercharges from its affected customers it is trying to collect only what is due so the money can be used to help lower rates for everyone else.
"This really looks like it is shaping up to be a six-month (back billing) issue or a 24-month issue," Shepherd said.
Lori Garcia of Santa Clara, who found an extra $1,064 charge on her February 2008 natural gas bill, said she continues to believe that Questar should bear the cost of its mistakes. "I could understand if I owed money because of a billing error," she said. "But this had to do with their equipment not being checked to make sure it was operating properly."
Still, Garcia said getting backed billed for six months instead of two years would be better for her family's finances.
Like Questar Gas, the Committee of Consumer Services, whose job it is to serve as the voice for Utah consumers and the owners of small businesses in utility regulatory matters, also is weighing its response to the division's report.
"We will be providing the PSC with some different recommendations," said Michele Beck, the committee's director. In April, Beck stated that "utilities are not automatically entitled to recover all costs from ratepayers for unjustified mistakes."
