Electricity Bill Costs

My electric bill is divided between provider (generation) and delivery. I assume this is so you can purchase your kilowatts from someone other that the company that delivers the power to your house. Perhaps "fuel" is the same as "generation".

The fuel portion is most likely a surcharge to cover the higher than budgeted costs for Diesel or Bunker C oil used to supply the boilers required for turbine operation.

Most electrical utilities have to maintain prices set by the approval of a Public Service Commission who regulates how much they can charge businesses and homeowners. When fuel charges go up a bit they say "Whoops, we did not plan for that" and just tack on the fuel surcharge as a CYA, or CMA in their case.

Now that the price of most petroleum products is falling; how long before the fuel surcharge is reduced, or better yet, eliminated? I think that is the real question.

Ing. Robert Forbus

go to www.google.com type in the name of your electric company in quotes, like this. "my electric company" then click the search button.

You will get a number of sites. go to then in turn and see if they have a menu that mentions explain your electric bill. read it

A Fuel escalation clause allows utility executives to constantly raise utility rates without assuming blame for the action. Another trick is to charge customers for the price of "purchased power" from a neighbor utility or a delivery charge for the distance the power was transmitted. Purchases power is constantly "traded" back and forth. Can you imagine the purchased power was not resold the next day at equal charge? The transmission charge is like stating the short transmission line from Chattanooga, Tn (TVA) to Atlanta, Ga (Ga Pwr) was busy requiring transmission through Huntsville/Memphis/Nashville and back to Chattanooga Tn.

You reside in a utility district that enforced a "fuel escalation clause" several years ago. Rates automatically increase as fuel (coal, nuclear, gas) price escalates. Rather than accept responsibility for rate increases, the local utility simply fixes the blame on the increased cost of fuel. There is a negative incentive for that utility to negotiate a reasonable fuel contract. There is a positive incentive for that utility to switch to high cost foreign supplied natural gas from potential lower cost hydro, wind, solar, nuclear, biomass, corn or coal.

This year the TVA board voted a decrease in electrical rates in conjunction with a fuel escalation clause. TVA needs more money but doesn't have the desire to raise rates or project the image that rates increase. In a short period of time with fuel prices projected to esclate out of control, TVA supplied utilities will enjoy a fuel esclation charge that dwarfs the Kw-hr charge. Face the music. S David Freeman, previous TVA chairman and present Calif Utility Executive, personally got Gray Davis terminated by the terminator because of failure to lock in long term generation rates. S David felt that utility deregulation would deliver spot rates lower than long term rates.

Has anyone ever seen a negative charge for the fuel escalation clause when fuel priced dropped?

Has anyone ever seen a negative charge for the price of purchased power from a neighbor utility being lower than that of self generation?

The Southern Company does not have to play those games. The local cities are part owners of the local utility. Transmit power into SoCo and it gets taxed at the meter. Purchase power from SoCo and it gets taxed at the meter. SoCo Cities that generate power at the plant they own can tax power they sell but not tax power they use. And now you know the rest of the story - Dalton Ga produces 80% of the world's carpet. Carpet is a high energy user and no competitor can compete with the cost of Dalton Ga a part owner of Ga Pwr SoCo power plants.

Cornstoves, exactly correct. I did not go into as much detail as you. The permission to levy a "fuel surcharge" allows more income (or at least steady income) without having to take everything before and through the PSC of the affected state.

There are commonly many other "got-cha's" that are disguised on the bill as well, depending on the utility company. I remember just a few years ago when the billing statment was very simple, and all I wanted to do was calculate the power factor for plant efficiency. Now the bill is two (2) pages!!!!

Ing. Robert Forbus

Part of California's power woes focus on some of their state laws - utilities in CA were prohibited by law from entering into long-term contracts with other electricity providers. With no long-term contracts in place, the local utilities could only use short-term contracts - when that isn't enough, local utilities must turn to the spot market, where the seller commands his price, period.

If CA utilities were allowed to enter into long-term contracts, there wouldn't be as much turning to the spot market by the local utilities, who generally can't generate their own electricity.

I know that explanation oversimplifies the dynamics behind electricty pricing, but that is the short answer. In my city, our utility entered into some very nice long-term contracts many years ago. The effect is that it is now cheaper for us to buy electricy than to generate our own. Our utility toyed with adding a lot of extra generating capacity some time ago, and the deciding factor was that even though we could buy our electricy for less than we could generate our own, we could sell the excess we generated to CA on the spot market! When CA finally fixes their legal situation, we will be looking good with the excess capacity considering the rampant growth in our community.

SledDriver,

No system is perfect. Whether by forsight and proper planning or a stroke of good luck, take a look at the electrical utility generation/transmission/taxing laws in force in Georga that benefit local Georgia residents, Georgia Power, and the parent "The Southern Company".

When a power plant is under construction in Ga, local cities and businesses purchase part ownership in the power plant in accordance with anticipated load requirements. In effect Dalton Ga, for example, generates it's own electricity tax free at a very low cost. Local citizens benefit with jobs created by businesses that benefit from low cost power. Excess generation is sold (to TVA or Fla Pwr) benefiting both Dalton Ga & the state of Ga with tax revenue and profit revenue.

Wisely, Ga tax revenue meters are located at point of use. If Ga pwr purchases power from TVA, the power gets taxed at the meter and Ga wins. If the power is generated locally, Ga wins. Power transmitted to a TVA state is taxed as it crosses the state line. Ga wins.

States that generate TVA power get no tax benefit unless the power is used internal to the state where generated.

Georga legislators pass wise laws that benefit the Georgia people they represent. TVA is federal.

S Gray Davis personally convinced the California legislators that "Utility Deregulation" would immediately result in spot prices well below long term prices. The legislature and citizens of Calif got duped. Wake up and change the law. Generate in your own back yard. Tax generation, transmission, purchased power, spot market, long term market, metered generation, metered use. Discretely Enforce fuel escalation charges that fool local citizens to believe there has been no increase in power price. No matter how locals are forced to pay more for power, the lowest cost power is local renewable corn/grain/biomass. Selection of corn energy is an individual choice. NIMBY does not apply to clean corn energy. Corn heat reduces global warming and converts a net positive amount of CO and CO2 to oxygen. But the only reason anyone chooses corn energy is because no energy cost less than corn. The cost of corn competes with cow feed and not petro. Local farms produce local power. Help the local farm. Help solve the energy crisis. Heat with corn. Corn prices are stable since 1817.

Do you have Natural Gas service also? If so maybe the fuel charge is the Nat. Gas and as you know the kW/Hr is Elec. Vectren, the monopoly in my area, has it split like this. The cost of energy has went up so much, one year they raised it 60% then another 60 some % the next year and then 70% again the year after and this year we get a break, so far they are only raising it another 5%.

*****VERY IMPORTANT*****

As soon as you get a chance, check the following: Turn off the main power switch to your house and garage, then walk out to your electric meter and make sure that it is NOT running. Obviously the meter should not run when all of the power is off but the elec. company here in southwestern Indiana has found a way to make the meters continue running. This would be a great way to make an extra million or so every year from unsuspecting customers. By letting the meter continue running like this they can make that little bit extra out of each customer without the customer ever thinking about checking it. When confronted about it they blow it off as a faulty meter, but why would it be made to where it could ever continue running at all unless they wanted to do this. I had a high heating bill and they didn't want to work with me on it. They shut my electric off and charged me a fortune in fees because they could not wait one more day so I could get my paycheck.

I called and talked to the main guy and told him that I was going to take the story to the newspaper...talk about a change in customer service! He made me eligible for a Heating Help fund that I was not qualified for prior to that phone call. Normally it takes them 24 to 48 hrs after you pay your bill up for them to come out and turn your elec. back on but I had everything up and running in 2 hours.

Utilities regulate themselves. The watt-hr meter that measures electrical usage is calibrated by the utility. The utility also is the book keeper that pencil whips the recordings the utility meter reader recorded.

For reasons just stated, Corn stove owners are cautioned to take meter readings monthly personally and be prepared to contact the utility with actual readings. Do not expect the utility to adjust the normal meter readings (normal utility bill plus per cent increases in charge rate) for at least 12 months after installing the corn stove. Most utilities assume responsibility for taking actual meter readings on alternative months only. The "office personnel" are allowed to adjust the actual meter readings to shadow the "norm" as defined by the utility. The utility also assumes the responsibility to collect "approved" amounts from each customer to help assist the "needy" such that the heat is not curtailed during inclement weather. The utility assumes the responsiibility to determine and define the word "needy". A legal person fully well knows the Webster defination of the english word "needy" to be any person who develops a need ie I need a free ride. BTW: Customers pay the "needy" fee. The utility does not pay the needy fee. The utility collects and maintains the excess customer contribution to the "needy" fund. Who ever qualifies?

Utilities also request a need to determine the "flat monthly rate" spread over 12 months time in order to collect projected usage in advance of peak winter or summer usage. Of course, all utility incentives are approved as needs to satisfy customer "demand" or satisfaction.

Wake up fowlkes! Quit being held hostage and yielding unquestioned homage to monopolies like the local utility, restricted trade like the big oil or wood pellet, excess federal tax as with coal, foreign financial stock manipulators selling your intelligence short or buying low. Get this - purchase a 1000 watt generator for @$150-$200 and generate 1000 watts or $300 and generate 2000 watts for corn stove heat, microwave cooker, and refrig at less cost than grid electricity. A disgrace but a fact. Not to mention that utilities are raising rates because of "deregulation"!! While big oil is raising prices because of last year's Katrina.