Electric Utility Deposit Bond - Sumter Electric Cooperative, Inc. (SECO) in Florida
Table of Contents
Brief Summary
SECO Energy requires a security deposit on every new non-residential account, and the deposit equals about two months of billing. For a business with real load, that is cash you would rather keep in operations. SECO's own service terms allow an irrevocable letter of credit or a surety bond in place of a deposit of $1,000 or more, so a bond can stand in for the cash.
Sumter Electric Cooperative, Inc., doing business as SECO Energy, requires a security deposit for all new non-residential service, with government entities exempt. Under SECO Policy 207.8, an irrevocable letter of credit or surety bond may be accepted in lieu of a deposit of $1,000 or more. The bond guarantees payment of the member's electric bills, and SECO is the obligee.
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How to Apply for an Electric Utility Deposit Bond:
- Ask SECO Member Services for the deposit amount on your account.
- Confirm the deposit is $1,000 or more, the point at which SECO may accept a surety bond.
- Confirm SECO will accept a bond for your account and whether it has its own bond form.
- Use the legal business name exactly as it appears on the SECO account.
- Complete the bond application and review the quoted premium.
- Deliver the executed bond to SECO before the connection or change of account order is issued.
Detailed Information About the Florida Electric Utility Deposit Bond:
The $1,000 line
A surety bond is not an option for every SECO account. SECO Energy's Terms and Conditions of Service, Policy 207.8, state that an irrevocable letter of credit or surety bond may be accepted in lieu of a deposit of $1,000.00 or more. Below that figure, expect to pay the deposit in cash. Acceptance is at SECO's discretion, so confirm with Member Services before ordering the bond.
How SECO sets the deposit
Security deposits are required for all new non-residential services, and government entities are exempt. For an existing location, the deposit is two times the average billing for the service location during the preceding twelve months of normal use. For a new address, it equals two months of estimated usage based on an estimated load factor for that type of account. Established members with poor payment history may face an increased deposit of two months' average billing on all accounts. Applicants with bankruptcies or unpaid utility bills, or who refuse to provide a Social Security number, are charged the maximum deposit listed in SECO's Rate Tariff.
What the bond guarantees
The bond backs the member's obligation to pay for electric service. If the account closes with an unpaid balance, SECO can recover it from the bond up to the bond amount, and the member must reimburse the surety. SECO's terms note that security deposits are not an advance payment of electric bills, and a delinquent account may require a new or additional deposit.
Starting service
To start service at an existing commercial or industrial facility, SECO directs applicants to Member Services. New commercial or industrial construction uses SECO's Commercial/Industrial Notice of New Construction form. Ask Member Services for the deposit amount on your account and for any bond form SECO requires before the bond is issued.
Eligibility and Requirements for a Florida Electric Utility Deposit Bond:
- Sumter Electric Cooperative, Inc. (SECO Energy) named as obligee.
- Bond amount matching the deposit SECO sets under Policy 207.8.
- Non-residential account with a deposit of $1,000 or more.
- Business credit and owner credit review by the surety. Premium is set by the surety based on that review and the bond amount.
Florida Electric Utility Deposit Bond FAQs:
SECO's residential deposit policy does not provide for a surety bond. The bond option appears in Policy 207.8 for non-residential accounts with a deposit of $1,000 or more.
It matches the deposit SECO sets. That is two times the average billing for the location over the preceding twelve months, or two months of estimated usage for a new address.
No. Policy 207.8 exempts government entities from the non-residential deposit requirement.
SECO's non-residential policy requires a deposit for all new services. Established members with good credit are not required to re-deposit on all accounts, but new service still carries a deposit.
