UCM
Utility Cost Management LLC
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History

The leading rate analysis service in California. Analyze electricity, gas, water, sewer, and garbage utility billings to identify charges that do not comply.

History

In early 1990, Michael Kerkorian developed the concept for what would later become UCM. Michael was working for a San Francisco consulting firm whose largest client was Pacific Gas & Electric Company’s legal department. In this capacity, Michael was closely involved in various aspects of PG&E regulatory matters.

From this experience, Michael concluded that the rules that govern how much a utility may charge are arcane, complex, and highly technical. Moreover, most customers — even large ones — cannot possibly stay abreast of these convoluted and ever-changing rules.

When UCM opened for business in San Francisco in 1991, it started by reviewing bills for a variety of small retail establishments. In the early 1990’s, the business grew gradually, working with mid-sized commercial customers, such as shopping centers, real estate companies, office buildings, and multifamily housing providers.

UCM’s work for schools and colleges led to its involvement in the State of California’s Utility Bill Auditing Program in 1997. In a statewide search for capable utility auditing firms conducted by the California Department of General Services, UCM received the highest point total of any bidder. This project proved to be a milestone in UCM’s development for two reasons. First, the sheer size of the project established UCM as capable of handling even the largest, most geographically diverse clients. Second, the project enhanced a long relationship with public entities that continues to this day.

The year 1997 saw another important development when, after a two-year process, the firm successfully completed its first formal PUC complaint. Regulators agreed with UCM’s contention that a large food processor was billed incorrectly for electricity service, and ordered a refund of more than $1 million. In subsequent years, UCM has continued to develop its expertise in handling PUC complaints, and has regularly used this process to resolve disagreements with utility providers that cannot be resolved informally.

With the continuing growth of UCM’s client base and service offerings, the firms staff also grew. The growth prompted the opening of UCM’s second office in 1998, this one in California’s agricultural heartland of Fresno. The Fresno location fostered the development of ties with the State’s agricultural community, a connection that was formed in UCM’s earliest days and which has become stronger over the years. Four years after UCM opened the Fresno office, its Bay Area office was merged into the Fresno office, which remains UCM’s headquarters today.

2003 was notable for UCM because it wrapped up a four-year effort to reduce electricity costs for 69 cotton gins. Regulators ordered the utility to pay more than $9 million in refunds to the gins, and significantly reduced ongoing electricity charges. That same year, UCM completed its work on behalf of a 1,400-member trade association whose members were being treated unfairly under newly adopted electricity tariffs. UCM worked with the utility and the PUC to revise the tariffs, reducing costs by millions of dollars each year. Aside from the significant cost savings, both of these projects were important in establishing UCM’s ability to bring about regulatory changes for customer groups, trade associations and entire industries.

In 2004, UCM began working as an active advocate for non-profit entities that provide housing to low-income tenants. For example, UCM successfully protested an electricity rate increase that disproportionately impacted low-income housing customers. It initiated changes to utility rules that dramatically expanded the availability of discounted rates to low-income properties throughout California. And it worked with a large gas utility to create a new discounted rate schedule for low-income properties.

In recent years, rapid changes in the utility industry have fueled the need for UCM’s services.  For example, greater use of “smart meters” and utility accounting software has produced an abundance of valuable data that should be analyzed, interpreted, and acted upon.  Technological advances have introduced new options for customers to generate their own power or reduce their energy or water consumption, but these technologies must be scrutinized and evaluated both before and after implementation.  UCM is filling a critical role by offering objective advice and analytical services in this complex and changing environment.

In the coming years, UCM will remain committed to helping all types of utility customers. As utility rates continue their relentless march higher, and new regulations and technologies offer ever-increasing options to managing costs, UCM will be there to help make sense of it all, and to “level the playing field” for customers in their dealings with utility providers.