Power and Utilities Cost of Service and Rates
Charge residential electric customers $75 per month, then add usage charges?
The monthly residential customer electric bill consists of a customer charge and a kWh charge. The monthly electric bill for a large power user consists of a kW charge and a kWh charge. Would it surprise you if the costs of the customer charge and the kW charge are two-four times more than the amount charged to the customer? The undercharged amount ends up in the kWh charge. Why is this, why does it matter, and what might you do about it? Read on, and we’ll share some schools of thought on electric ratemaking.
Electric Cost of Service Rates and Rates for New Technology - One Utility’s Approach
An electric utility recognized that it needed to increase electric rates after developing its budget for the coming year (also known as a revenue requirement). The utility had not increased rates in 5 years and wanted to take the opportunity to move customer rates towards their cost of service and to incorporate distributed energy resources (DER) and electric vehicle charging into their rate structure.
Here are the steps they took to move to cost of service rates and implement innovative rates for residential, DER, and EV customers.
Electric Rates for Solar Power and DERs
Distributed energy resources (DERs) are taking on a greater role in the energy planning process for co-ops and utilities. FERC Order 2222 and the NARUC Distributed Energy Resources Rate Design and Compensation publication discuss this trend and the recommended rate structures that are becoming industry best practices.
Cost of Homeowner Solar Power - the Costs Before the Meter
Solar power customers have a love/hate relationship with their electric provider. Before you install solar panels on your home, know the full cost of ownership.