‘Unfortunate’ billing error by electric co-op will cost some South MS customers hundreds

EDITOR’S NOTE : Coast Electric has backed off its intention to charge customers for the billing error it made.

ORIGINAL STORY

Coast Electric made a billing error this year that undercharged thousands of South Mississippi customers, who must soon pay the difference, the company said this week.

From January through August 23, Coast Electric underbilled about 4,500 of its 90,000 accounts, said April Lollar, the electric cooperative’s director of communications.

The Mississippi Public Service Commission, which regulates some electric utilities, said the action was legal. Southern District Commissioner Wayne Carr called the mistake “unfortunate.”

“It was human error,” he said. “They have apologized intently.”

Coast Electric sent letters on Monday that notified customers of the error. For nearly eight months, those customers were charged 41 cents per kWh when they should have been billed 87 cents per kWh, the letters said. Lollar said Coast Electric has since corrected the rate and customers are being billed correctly.

Mississippi residents use an average of 1,132 kWh per month, according to the Public Service Commission . Coast Electric customers who used that amount over the past eight months could see a charge of about $416 added to October bills, according to the Public Service Commission’s average and the rates Coast Electric provided.

Some customers reported steeper charges. Others are on fixed incomes, Carr said.

Lollar said Coast Electric is “working with each member to set up a payment plan that meets their individual needs.”

She said she was not aware of any instance when members’ payment would be waived. She also said Coast Electric was “implementing additional checks and balances internally to ensure errors like this don’t happen again.”

An mistake on the back-end of Coast Electric’s billing system caused the problem, Lollar said. It affected customers across the company’s service area of Harrison, Hancock and Pearl River counties.

The Public Service Commission had received over 125 complaints by Wednesday from frustrated customers, said Caroline Tibbs, a public affairs representative for the Southern District Commissioner. She also said the impacted group includes new members who began using Coast Electric in January.

“It’s a small percentage,” Carr said. “But it still hurts.”

Can Public Service Commission help?

Carr said the Commission cannot intervene on behalf of customers because Coast Electric is a member-owned co-op, rather than investor-owned utility. Coast Electric customers, or members, have power to go to the co-op’s Board of Directors and call for a meeting to discuss the issue and ask questions, he said.

Carr said his office has limited oversight but would check in weekly with Coast Electric to ensure payment plans are on track and that ratepayers concerns are heard.

He also said it was the first time he had heard of customers being billed for an internal error at large scale. He pointed to a 2019 Mississippi Supreme Court decision that ruled in favor of the Alcorn County Electric Power Association, which mistakenly undercharged a north Mississippi business for six years before it realized its mistake and sought to recover the money. The Court forced the business to pay back more than $25,000.

The Commission’s regulations do not directly address the issue of charging customers for a utility’s back-end billing error. But the rules say that when a customer disputes a utility bill, they can pay whatever costs less: either $500 or the amount of the disputed bill. Customers who pay either amount should still get utility service throughout the dispute and can be paid back later, depending on how the dispute is settled.

Coast Electric said customers who want to pay the charges over several months can fill out a payment plan form online at https://coastelectric.coop/paymentplan/ .

“They’re willing to work with people,” Carr said.