Following the results of a year-long trial of a pilot demand rate, the United Power Board of Directors agreed to a phase-in plan of a residential demand rate to replace the current rate structure.

“Since we have detailed information about how members use power in their homes, the new demand rate will be a fairer way for us to bill members for their use,” stated Dean Hubbuck, Director of Power Supply and Rates. “The impact on the system from residential users is lower than commercial customers, and their rates will reflect the difference. We believe a modest demand charge with a reasonable energy rate is the best way to recover our costs.”

The dynamic pricing model will provide a more fair cost structure, and gives members an ability to control their costs by staggering the use of electric appliances.

Learning about how a demand rate works will take a lot of communication, so the five year period is being used to help our members and employees better understand the rate and how members can control their costs with some simple strategies.

All members will now be seeing a new line on their bill simply entitled “Demand Charge.” Initially, there will not be a dollar amount attached to this line item while we provide the information as education for members. By adding the new line it will allow members to see an actual number that corresponds to their use. In 2019 United Power will institute a demand charge and that will slowly increase, with a corresponding reduction in the energy charge.

United Power has been actively communicating how a demand charge works via the newsletter United Newsline and members can find more information about Residential Demand here on our website. This information is being presented ahead of the rate change so our members have the opportunity to gain an understanding of this new way of thinking about their electric consumption.

Many members will see very little change in their bills, but some members who use more energy all at once may be more heavily affected, and without the demand rate they have been driving up costs for other users. We will continue to communicate about these changes via the newsletter and our website.

This past month, United Power announced a new line item would be appearing on member electric bills to prepare them for a new rate structure taking effect next year. The new line item, a Demand Charge, will not have a cost associated immediately, but will show the member’s highest usage interval in kilowatts (kW) from the previous month. The Demand Charge line item is appearing on bills now with no charge to give members an opportunity to understand how this new rate can help them better manage their energy costs.

Members on the standard residential rate are very familiar with total energy used, which is billed in kilowatt-hours (kWh). But the new residential demand rate will also measure the power, or demand component of electricity consumption, which is measured in kilowatts (kW). This demand component is something that many customers are less familiar with, so let’s talk about “watt” drives your demand.

Demand is measured in kilowatts (kW). One kilowatt equals 1,000 watts, which is the equivalent of turning on ten 100-watt light bulbs at once. Understanding the wattage of your household appliances will help you take control of your energy bill, but where can you learn more about this information?

Common wattage ratings can be found online, or by using tools like a Kill-A-Watt monitor. Below are some sample wattage ratings for common household appliances. Remember: the larger the wattage of an appliance, and the more appliances you operate at once, the higher the impact it can have on the energy usage and demand on your overall electric bill. 

Now is the time to pay attention to your energy use patterns. Staggering the use of higher wattage appliances will be the easiest way to manage your electric bill under the new rate structure. How many appliances do you run at once? Do you come home and turn everything on after the house has been empty all day? Are you using technology to help you remember to offset energy use like timers, delay start settings and programmable thermostats? Focusing on how you’re using your household appliances will help you see the corresponding affect to your energy and demand, and United Power’s new Demand rate will put you in the driver’s seat of your electric bill. 

It's Your Money, and Here's How it Works

Capital credits are just one of the ways United Power is different from other utilities. We’re different because we’re owned by you, our members. As we’re heading into our retirement cycle, here’s a brief synopsis of how capital credits work.

Step One: Membership

If you receive power from United Power, you are not just another customer. You are a member. Members have unique privileges, one of which is the principle of economic participation. A portion of each electric bill goes toward the cooperative’s operation and infrastructure, making you a part owner. 

Members may also vote annually in board elections or run for a board seat to make their voices heard. By actively engaging and participating with the cooperative, you will always have a voice in our operation. 

Step Two: Allocation

Every spring, United Power looks at the prior year and allots any funds remaining after all expenses are paid into a budget item called “patronage capital.” These designated funds are then “allocated” to members, based on the prior year’s electric consumption – the more power you use, the larger your allocation. 

The allocation is not a check, but a bookkeeping of the amount of money you have invested into the cooperative’s electric system based on your electric consumption. This allocation amount is reflected as an actual dollar amount on your bill in May each year. 

Step Three: Retirement

Every year our board decides if a capital credit “retirement” is feasible. If they decide to retire capital credits the money is paid out or “retired” from each member’s account, based on their past electric use and length of service. At United Power, anyone who receives a retirement of $10 or more receives a check, and any amount under $10 is returned as a credit on members’ bills.    

Look for more information about this year’s capital credit retirement in our August issue, and we’ll tell you how to enter to win a prize just for telling us how you’re going to use your capital credit refund!