Timothy McIlvain is a senior analyst in charge of electric utility audits for Illinois municipalities at Azavar Government Solutions. He specializes in ensuring that revenue from electric utilities is being accurately assessed and appropriately remitted.
In this interview, we learn about electric utility audits and how Azavar works with providers like ComEd or Ameren on behalf of municipalities to help identify discrepancies. We also identify some common issues that are found while conducting electric utility audits and how even smaller communities can see big returns when incorrectly coded addresses are found in a provider system.
Question: What is your area of focus as an analyst for Azavar Government Solutions?
Answer: I’m a senior analyst in charge of electric utility audits for Illinois municipalities. Anytime a community that we get as a client has an electric utility tax, I’m in charge of that audit. If a community has one provider that provides both their electric and gas service, like Ameren in Southern Illinois, I will conduct both the electric and gas audits for that client.
Question: How often do you find a company like Ameren that provides both gas and electric service to a municipality?
Answer: It’s typically a geographic distinction. I would say most of the northern half of Illinois is pretty much dominated by ComEd for electric and Nicor for gas. For communities in that part of Illinois, I will just do the electric audit. Once you start getting into central and southern Illinois, you will see Ameren in many of those communities providing both the electric and gas. In that case, I will conduct audits for both gas and electric.
Question: When you work for a client, do you work directly with the provider like ComEd or does the client have to contact them?
Answer: When we get a new client, they sign a form called the “letter of agency” and that allows us to act as the client’s agent. This allows us to go directly to the providers or directly to a contact at ComEd or Ameren to request the information we need.
Question: Can you typically access the necessary provider information from a database, or do you have to go on site at ComEd to get access to their information?
Answer: We have a good working relationship with ComEd since we’ve conducted so many audits over the years. We have a system down where once we have that letter of agency, we send an audit notice to ComEd or Ameren and request the information we need.
They’re typically able to provide our requested information in a pretty timely manner. We will get the address database and the database of information we need directly from the provider in an electronic format.
Question: Are there any prevalent issues that come up consistently from one client to another when working electric or gas audits?
Answer: I wouldn’t say that there is a systemic issue with any of the providers that causes the errors we find. But there are some clues that I look for that can give you a hint as to where the errors might be.
If we have a community that’s somewhat isolated and surrounded by a lot of unincorporated area, that community has often done some annexing. I’ve found those annexed addresses can often slip through the cracks and not be coded correctly.
If communities have streets that change names, sometimes that can cause confusion with addresses. In addition, buildings with multiple units can cause similar issues.
Communities that don’t have clean, rectangular-looking borders, but might have some jagged edges or if the two communities meet in an odd way, sometimes in the middle of a street, that can cause some confusion and you can see some errors in the provider system.
We’ve even seen a situation where there was a small community next to a much larger one and within that small community, some of those addresses mistakenly used the larger community’s name. That can cause confusion in the provider’s databases and we can also find errors there.
Question: Have you seen any change in terms of data quality with ComEd improving their smart grid technology?
Answer: I would say that ComEd has pretty good data integrity. For a typical community that has 50,000 people or so, we often don’t find many errors in their collection data. It’s more that we’re finding addresses that may have fallen through the cracks.
Question: Is there at timeframe that you typically recommend that a municipality should re-audit their data? Should they go back annually or every five years to audit and take a look again to see that things haven’t slipped through the cracks?
Answer: The Illinois state statute limits you to an audit only every two years. Therefore, the soonest we could do it would be two years later.
Sometimes the client may come back to us after there has been some new construction or a new annexation and they want us to proceed with a new audit. But as I mentioned, you must wait for the statutory period of time before we’re allowed to do another audit.
Question: What do you think are the qualities that you’ve had to develop to become a top-level analyst?
Answer: I think one of my strongest capabilities would be attention to detail. When you’re working with clients that have 20,000 to 50,000 addresses in their town, you’ve got so stay focused to identify the anomalies.
For example, if you find an issue with a commercial or industrial address, that could have a pretty significant impact on the remittances that the town receives for electric utility taxes. Therefore, it’s very important to have an eye for detail and to always review the work. That’s something I take great pride in.
I also think that my proficiency with Excel and the other technologies that we use to analyze all the data is something that helps me greatly with our client audits. I’m currently creating and teaching a weekly Excel-based class for our team of analysts. We’ve covered everything from formulas to pivot tables and now we’re working on linear regression and macros.
Question: In addition to Excel, what other technologies do you use in your work? Are there any new tools that you currently use that were not available when you started here at Azavar?
Answer: We have developed our own proprietary software that we use to parse a large amount of address data in an efficient manner. There’s also a tool we call GAT, Geographic Analysis Tool, and that helps improve the overall quality of the audit, eliminating addresses that may not be necessary to review and highlighting addresses that might warrant a second look for potential errors.
Question: Is there anything that you use to help when you work with a municipality where you’re going to do both gas and electric audits? Do you find this dual-audit process more complex or does even out in the long term?
Answer: I don’t know if it’s more complex, but it’s certainly more work having to do the gas and electric audit. But what makes it easier is when we get all the data from a single source. If we get all the data from Ameren, for example, there are typically limited discrepancies on how addresses are written. It’s consistent and it makes it an easier analysis in that regard because you have one source for data instead of many.
Question: Are there any projects in your career at Azavar that you are particularly proud of?
Answer: There have been several times where we had smaller community clients where we’ve found some significant issues for them. We might have found some commercial addresses or an industrial address that were coded incorrectly in the provider system and that tax was going to the wrong area. A couple of those clients received some large recoveries for the back taxes that we were able to file for them.
Question: What do you see for the future of electric and gas audits? Do you envision much innovation within the next few years in terms of data collection?
Answer: We’re always improving our process and trying to become more efficient and effective. I think the expansion of renewable energy; especially home-based solar panels could have a big impact on energy consumption and how we assess residential markets.
That’s something that communities will need to monitor for their tax codes or their electric utility tax. Municipalities will probably be affected by some form of renewable energy within the next five to ten years, especially if solar panels keep dropping in price.