TITLE
Recommendation to authorize City Manager to execute a Fourth Amendment to Contract No. 20610 between the City of Long Beach and Southern California Edison to change the terms of the agreement for Meter Reading Services. (Citywide)
DISCUSSION
The City Council-endorsed Three-Year Financial Strategic Plan recommended the examination of meter reading and billing cycles under services considered for optimization. Meter reading services are provided under a contract with Southern California Edison (SCE). This contract provides for monthly reading of gas and water meters to determine usage, and is used to bill customers monthly. The cost to provide monthly meter reading in FY 04 was $1,961,380, and under the existing contract, this cost would have increased by the Consumer Price Index (CPI) starting with services provided in January 2005, to an estimated $2,008,138 for FY 05.
A study of the utility industry was conducted to determine other possible billing models for potential savings. After consideration of the alternatives, the most feasible option was to read customers' meters every other month while continuing to bill monthly. The basis for this decision, and the City's proposal, is that this approach will provide the customers with a reasonable estimate of their usage by which to produce a bill for the months that the customer's meter is not read. On the next bill the usage will be "trued up" by reading the meter and billing for actual usage. This approach relies on the concept that an individual customer's usage pattern generally tends to remain consistent over time, with variances correlating closely with weather patterns. Testing of this approach was conducted over the past six months, and has been determined to be accurate. The testing has proven that customers used approximately the same amount of gas and water from year to year, particularly after taking into consideration variances in the weather. Since historical usage could be u...
Click here for full text