Estimations

What is an Estimated Bill?

The term "estimated bill" is used to describe the process of determining a "best-guess" of a customer's monthly electric bill based on their billing history for the prior year. In other words, our computer system estimates any electric meters that were not actually read during the month by our meter readers. This procedure gives the customer an approximation of their electric bill based on how they used electricity over the past twelve months.

Why Estimate Bills?

Edison Sault Electric Company has found through experience and conversations with our customers that many prefer to receive an estimated bill followed by an actual bill, instead of receiving no bill and then a double (or two months) bill. Also, the realities of the workplace, our weather, and the economics of keeping your electric rates low make reading every meter, every month, virtually impossible.

How is an Estimate Calculated?

The estimate is made on a meter by meter basis. Thus, we tailor the result to each customer's pattern of consumption. First, the overall monthly average is determined by totaling all kilowatt hours consumed in the past twelve months and dividing the total by twelve. Next, we calculate an average for the most recent prior two months and the least recent prior two months. In other words, if the months are numbered 1 through 12, with 12 representing the month from a year ago, and 1 representing last month, then, the most recent average would be the average of months 1 & 2, while the least recent average would be months 11 & 12.

For each billing period, we also track the number of days over which the energy was used, and we adjust these averages to account for differences in days. Also, for accounts of a seasonal nature such as cabins and hunting camps, we assume that usage was zero unless we actually read the meter and recorded usage.

Using the three averages and the days in each billing period, a formula for a weighted average is used to estimate the expected daily usage for the current month. This weighting assumes a customer's usage from one December to another will be closer in accuracy than if comparing their July billing with a December billing. It also assumes any increases in consumption would be reflected best by comparing usage from 12 months ago to the previous month.

We can describe our estimation process in the following manner: Starting with the monthly average, we adjust that average up or down depending on how much more or less energy was used 12 months ago versus the annual average. We then adjust this modified annual average either up or down based on any changes in usage (increases or decreases) over the past twelve months.

Our goal is to estimate your bill at or below your normal expected usage for each month. We never try to estimate bills higher than the actual usage, although a sudden change or drop in electric consumption can cause our computer to overestimate.

What if the Estimated Bill is wrong?

It is important to remember an estimate is nothing more than a mathematical guess of how much energy was used during the month. Although we monitor and fine tune our estimation process, sometimes situations arise where we miss the mark.

If your bill was estimated too low, consider sending a payment closer to the amount you believe should have been billed. The next time we read your meter, we will include the additional usage on the billing. A larger payment made at the time of the estimated billing will help offset the higher billing that will follow.

If we estimated your bill too high, consider contacting one of our customer service agents. They can help with billing options that may improve the quality and accuracy of future estimated bills.

If you have electric heat (either partial or total) and we estimated the bill too low or too high, you may wish to consider enrolling in our budget billing program. This program offers twelve equal monthly payments and helps avoid problems with high winter bills or low estimated bills. The payments are calculated based on your prior year's average monthly usage and are adjusted annually to reflect any changes in consumption. Again, contact one of our customer service agents for information and assistance regarding our budget billing program.

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Last modified: May 01, 2008