Distributor Audit of North Georgia Electric Membership Corporation (NGEMC)

The OIG reviewed North Georgia Electric Membership Corporation (NGEMC), a distributor for Tennessee Valley Authority (TVA) power based in Dalton, Georgia. The objective of the review was to determine compliance with key provisions of the power contract between TVA and NGEMC. Our review found 34 misclassified customer accounts. While we estimated the monetary effect of the misclassifications were not significant, there were qualitative issues that were significant due to their systemic nature.Some of the misclassifications identified resulted from an ongoing NGEMC policy to classify separately metered well pumps serving residences as residential rather than commercial and a discontinued policy to classify any facility that had living quarters, including group homes and cabins owned by individuals and/or organizations, as residential. We also identified certain opportunities to enhance TVA oversight of distributors which were also reported in previous distributor audits. TVA and NGEMC agreed with the OIG's recommendations and have taken or planned to take actions to correct the identified issues.