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RCED-83-64 1 (1983-02-28)

handle is hein.gao/gaobabmvp0001 and id is 1 raw text is: UNITED STATES GENERAL ACCOUNTING OFFICE WASHINGTON, D.C. 20548 RESOURCES. COMMUNITY, AND ECONOMIC DEVELOPMENT DIVISION B-209897 FEBRUARY 28,1983 The Honorable Donald P. Hodel IIIII 1111111 II The Secretary of Energy 120655 Dear Mr. Secretary: Subject: Changes in the Bonneville Power Administration's Billing Practices Could Reduce Interest Costs and Improve Cash Flow (GAO/RCED-83-64) A review of electricity billing practices revealed that if the Bonneville Power Administration (BPA) changed its customer billing processes, more than $3.2 million in interest expenses could be avoided annually. These savings could be obtained by --billing utility customers promptly ($1.8 million); --negotiating contract changes requiring California utility customers to pay monthly, rather than quarterly ($1.4 mil- lion); and --requiring Federal agency customers to pay interest on late payments ($60,000). These interest expense savings would result from less short-term borrowing by BPA since monies due would be received more quickly and on a regular monthly basis. Several earlier audits, both from within and outside BPA, have pointed out this opportunity to save some interest expenses. The most recent audit of this subject is being done by the Depart- ment of Energy's (DOE) Inspector General and includes a review of customer billing practices as part of an overall examination of cash management practices at power-marketing administrations. Dur- ing our review, the DOE study was still in draft form, and BPA questioned the practicality of some of the draft recommendations. Because of BPA's questions, part of our evaluation was to determine the nature of BPA's objections to the DOE report and to ascertain actions planned to improve the timeliness of billings. OBJECTIVES, SCOPE, AND METHODOLOGY Our audit approach during this assignment included (1) inter- viewing BPA officials responsible for billing, computer program- ming, and remote metering to determine customer usage; (2) re- viewing policies, procedures, studies, and proposals pertaining e7 cI 4 ?1(005291)

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