# The price of electricity



## zknowlto (May 18, 2011)

I've been thinking about this for awhile and haven't found a satisfactory answer.  Generally when someone reports that they pay X per kilowatt hour, is this the "actual" ("commodity") charge of the electricity, or does this generally include the distribution and other surcharges?  The "raw" charge of my electricity is $0.0837 per KWH, but with the various surcharges this climbs to $0.097442 per KWH (and just over 0.10 per KWH with sales tax).  Is there a standard way electricity costs is reported?


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## begreen (May 18, 2011)

Standard way out here is like the phone co. The basic charge, then enough stuff added on to increase it by 50%.


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## heat seeker (May 18, 2011)

I refer to the total cost of the electricity. Around here (CT) we pay 20Â¢ per KWH - and that's high! Monthly bill for us (2 adults) pushes $100/month, more when we use the AC.


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## woodchip (May 18, 2011)

We pay approximately 19 cents a day "standing charge" for the connection, which includes maintainance of the service and wires to our meter. We then pay 20 cents per kilowatt for actual power useage. 

Which means if you are really careful, and use only a few kilowatts per month, you find the "real" cost per kilowatt is actually quite expensive. 

Just waiting for mini biomass generators for home use to be invented  ;-)


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## mayhem (May 18, 2011)

I always talk about the actual cost of my electricity, without taxes.  So when I say I pay 18.5 cents per kwh I'm including both generation and delivery charges.  I don't think it makes sense to taidcuss one without the other.


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## webbie (May 18, 2011)

18 or 20 cents is not high when you look at it another way!
We were paying 10 to 12 cents in NJ back in 1979. Add 30 years of inflation to the mix, and it does not look too bad,

Some areas have very cheap electricity - usually due to some special deals or nearby hydro which needs to be used. I heard that they have an excess of hydro right now due to the rain and snow melt and hardly know what to do with it! 

In New England and some other areas, we have expensive infrastructure due to higher population densities.....also, we have a lot of expensive nuke energy and have to haul most fuels in (coal, oil, etc.). We get some hydro from Canada, but not enough down here in mid-New England.


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## Dune (May 18, 2011)

woodchip said:
			
		

> We pay approximately 19 cents a day "standing charge" for the connection, which includes maintainance of the service and wires to our meter. We then pay 20 cents per kilowatt for actual power useage.
> 
> Which means if you are really careful, and use only a few kilowatts per month, you find the "real" cost per kilowatt is actually quite expensive.
> 
> Just waiting for mini biomass generators for home use to be invented  ;-)



Your wait is over. Actualy over by 100 years or more but that is irrelevant.

http://victorygasifier.com/

This is one brand of many.

This unit coupled to an apropriately sized internal combustion generator will heat your home during the winter and provide electricity for the entire year, running just durin the heating season, asuming net metering of course.


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## Highbeam (May 18, 2011)

I believe it is most appropriate to include all costs in the per KwH reporting. I feel this way since the power companies play a shell game to move costs from the kwh to the delivery, lines, maintenance, etc. Any other way to look at power cost would be like trying to report wholesale prices which are not available to the end users.

Take your monthly KwH use, say 1000 KwH, and divide it by your total bill, say 100$, to get your cost of power per KwH which would be 10 cents in my example. 

Yes, electricity is cheap. Especially for us living in hydro country and with moderate climates. I think it is the energy source that will remain cheapest since most other energy sources can be used to make electricity efficiently in a central plant and the delivery infrastructure is already in place.


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## lukem (May 18, 2011)

I'm at $.09 for the first 300 kWh, and .05 for the rest...that doesn't include all the extras.  Bill, with riders and taxes averaged to .13/kWh last month.


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## begreen (May 18, 2011)

Dune said:
			
		

> woodchip said:
> 
> 
> 
> ...



Awesome Dune. This would be an interesting thread in itself. Could you start a new thread with additional links and info you may have gathered?


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## TMonter (May 18, 2011)

Highbeam said:
			
		

> I believe it is most appropriate to include all costs in the per KwH reporting. I feel this way since the power companies play a shell game to move costs from the kwh to the delivery, lines, maintenance, etc. Any other way to look at power cost would be like trying to report wholesale prices which are not available to the end users.
> 
> Take your monthly KwH use, say 1000 KwH, and divide it by your total bill, say 100$, to get your cost of power per KwH which would be 10 cents in my example.
> 
> Yes, electricity is cheap. Especially for us living in hydro country and with moderate climates. I think it is the energy source that will remain cheapest since most other energy sources can be used to make electricity efficiently in a central plant and the delivery infrastructure is already in place.



Actually I think they are required by law to separate the connection charge from the power cost. If you think about it though for the reliability of power, the connection charge is very very cheap. 

How often is the power out over a year's time barring a major event? Usually less than 10 hours a year here.

I pay 0.07903/kW for the first 600 and if I go over 600 which is iffy depending on how much we use the dryer I pay 0.08819/kW

The connection charge is $5.00

Average electric charge is between 55 and 75 dependent on various factors. Averages around 60.


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## zknowlto (May 18, 2011)

Thanks for the input all.  It always seemed reasonable to me to include all the transmission charges in with the actual electricity costs, and assumed that everyone calculated electric prices the same way.  I was looking at something the other day, however, that was basing its analysis on the "actual" electric cost and wondered if I had been thinking about this wrong the whole time.  I guess the method of calculation used depends on what kind of position your trying to support.  

Incidentally, my utility charges a flat $2.50 per month renewable energy portfolio fee (that I don't mind paying) and a $7.50 "customer charge" that I hate.  As we used only about 200 KWH last month, these two charges raised our electric rate by around 1/3.  This is still pretty cheap (Lansing has an enormous coal power plant in the middle of town), but it is something of a disincentive to cut back consumption.  It's annoying to think that if I installed a solar system and used zero net electricity, I'd still be on the hook for $120 per year.


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## TMonter (May 18, 2011)

Go Blue! said:
			
		

> Thanks for the input all.  It always seemed reasonable to me to include all the transmission charges in with the actual electricity costs, and assumed that everyone calculated electric prices the same way.  I was looking at something the other day, however, that was basing its analysis on the "actual" electric cost and wondered if I had been thinking about this wrong the whole time.  I guess the method of calculation used depends on what kind of position your trying to support.
> 
> Incidentally, my utility charges a flat $2.50 per month renewable energy portfolio fee (that I don't mind paying) and a $7.50 "customer charge" that I hate.  As we used only about 200 KWH last month, these two charges raised our electric rate by around 1/3.  This is still pretty cheap (Lansing has an enormous coal power plant in the middle of town), but it is something of a disincentive to cut back consumption.  It's annoying to think that if I installed a solar system and used zero net electricity, I'd still be on the hook for $120 per year.



You're paying for the guarantee of the service actually, which like I said considering how rare it is for power to be down it's very cheap. If you've ever worked around a utility and seen what they have to deal with on lines and such most people would have a better appreciation of the connection charge.


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## BrotherBart (May 18, 2011)

Our connection charge had been $10 for several years and recently jumped up to $15. All things calculated in our cost per KWH ranges from $0.1463 to $0.1477 according to monthly usage. I divide the entire bill by the KWH usage. The only way that makes sense. That is what you are paying for it.


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## Highbeam (May 18, 2011)

The cost per Kwh MUST include all various mumbo jumbo on the bill. You are not buying electric KwHs you are buying a pretty steady stream of "delivered" KwHs. 

I pay 50 cents for a snickers bar. I don't buy the peanuts only for 5 cents.


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## woodchip (May 18, 2011)

The problem is that the price per kw hour varies depending on useage when you have a fixed charge for connection. . 

Based on my last (3 month) bill, 161kwh cost me Â£31-80 ($51-42) giving me a price of 32 cents per kwh.

Were I to have used twice as much electricity (322kwh) it would have cost me Â£51-06 ($82.57) which is only 26 cents per kwh.

As an extreme, were I to have used just 1kwh, it would have cost me a staggering Â£12-91 ($20.88) for the 1kwh.

So I think it is a bit difficult for energy suppliers to be forced to advertise an exact amount people would pay per kwh inclusive.


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## BrotherBart (May 18, 2011)

Up until "choice" was tried as an option briefly in our state we had no idea what any of the charges were. We got a bill with two meter readings, a usage total and the amount to write on the check.


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## heat seeker (May 18, 2011)

We can choose our electric provider, but must pay the local company for use of their infrastructure, which is broken out separately on the bill. Switching to another provider might save me $10 or $15 a month. About half the bill is for service, the other half for power. The bill is broken down into (no kidding!) 8 different line items, some of which are just taxes with another name.


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## BrotherBart (May 18, 2011)

heat seeker said:
			
		

> We can choose our electric provider, but must pay the local company for use of their infrastructure, which is broken out separately on the bill. Switching to another provider might save me $10 or $15 a month. About half the bill is for service, the other half for power. The bill is broken down into (no kidding!) 8 different line items, some of which are just taxes with another name.



Same with ours now. But they abandoned the choice thing when nobody offered to enter the market. Shortly after the abandonment they raised the rates, of course.


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## TMonter (May 18, 2011)

Highbeam said:
			
		

> The cost per Kwh MUST include all various mumbo jumbo on the bill. You are not buying electric KwHs you are buying a pretty steady stream of "delivered" KwHs.
> 
> I pay 50 cents for a snickers bar. I don't buy the peanuts only for 5 cents.



Actually it's more akin to leasing a car. You pay monthly for the car whether you drive it or not and you have to pay for every dollar of gas that goes in the tank.


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## moosetrek (May 19, 2011)

Are you talking total cost, or what you pay?  There's the cost of the coal, the cost to haul it, the cost to distribute, etc. which should be production costs.  However, there are increasing costs not captured in there, like the enormous cost to add new lines (much of the transmission - not distribution - system was constructed decades ago.  The cost to upgrade this is going to be much higher than inflation would consider, as there are now permitting costs, environmental costs, and property acquisition costs (more dense population = more easements to acquire) that have kept investors leery of funding such massive projects, but demand increases and capacity will drive an eventual need for it.  Because the utilities can only build what they need (utilities regulation as they have to justify passing it onto consumers), they can't overbuild in anticipation so once demand goes up enough for new projects, many of the rates might rise.


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## Hass (May 19, 2011)

Used 358kWh last billing period.
Bill was $59.34

Billing Charge was 1.15
I didn't include that in the price.
$.16 per KWh.

I'm using the elec company as my supplier, so I'm going to change that right now actually and see if my rate changes.


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## Exmasonite (May 19, 2011)

Go Blue! said:
			
		

> This is still pretty cheap (Lansing has an enormous coal power plant in the middle of town)



Not to split hairs but how many coal mines do you see around lansing... or michigan for that matter?  As somebody who lived next to the train tracks in lansing for 3 yrs, i can tell you that about 80% of the train traffic (at least on some lines) involves hauling all that coal from somewhere not too close.  

I'll admit that the proximity to the plant may defray some of the expenses but don't let that fool you.  Having been a homeowner in michigan for 12 yrs, the cost of electricity has risen significantly.  I chalked it up to the price of doing business/progress but i don't necessarily consider it "cheap".


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## zknowlto (May 19, 2011)

Exmasonite said:
			
		

> Go Blue! said:
> 
> 
> 
> ...



I guess it would be most accurate to say that, compared to the figures that other people were reporting in this thread, the price I pay for  electricity is relatively inexpensive.  I don't know that much about how electric rates are determined, but I'd guess the close proximity of the plant, the developed network of freight train tracks around the city, the fact that a major GM plant closed recently, and the public utility status of the local power company all help keep the price relatively low.  While the cost per KWH has certainly increased over the past decade, the small conservation measures I've taken mean that my electric bill is lower than ever.


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## peakbagger (May 19, 2011)

I pay a flat rate for service plus a supplier charge for the power I use and some other per KW charges to cover various surcharges. I have grid tied solar so I get credit for power generated during the summer when I generate more than I use and then use up the credit in the winter. I still pay the flat rate every month (about $14) which I consider my cost for a "real big battery" that allows me to charge it at one time of the year and use it another time of the year). I used to break even on power production but when I started working from home, I end up buying some power in the winter.


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## fraxinus (May 20, 2011)

In the Central Maine Power service area we pay .06 per kwh delivery charge and .085 per kwh for the power itself. The latter has gone down quite a bit because of lower natural gas prices. 

Spread out over 12 months, I'm paying just a little more than $3 per day for: range/cook top, hot water heater, illumination, TV, computer, refrigerator, and all the little electrically operated gizmos we never think about. One of the greatest bargains in the world, I'd say.


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## steam man (May 20, 2011)

In northern Maine with Bangor Hydro as the distributor, we pay just shy of 9 cents kw/hr. For the electricity supply, we pay just over 8 cents kw/hr. 17 cents kw/hr is the combined rate. I live in the middle of Hydro country and it basically has little effect on my rate. We can choose the supplier here or have Bangor Hydro get the prevailing rate automatically. Just because the power plant is next door does not mean you must get it cheaper. Also, contrary to what was posted here, population or useage density on the system makes it so the more on the grid, the cheaper distribution is per user. Bangor Hydro has argued against private generation plants for large users especially since if they go off the grid the infrastructure still has to be maintained at the same cost. Here in northern Maine it is a big system to be maintained with fewer users to pay for it. The hydro damns near me generate power for just a few cents a kwh but essentially it is sold on the grid through transmission lines to many users outside the state.


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## Don2222 (Jun 8, 2011)

Hello

Well I guess I cannot complain. In Salem NH with all the delivery charges and all approx 11.7 cents per KWH !!

Just got a good deal on a Power Monitor at Lowe's
See link for pics and price  https://www.hearth.com/econtent/index.php/forums/viewthread/75723/


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