Demand Rate

Beginning in 2019, United Power will begin a phased-in implementation of a new rate structure that will replace the current way members are billed for electricity.  The new rate structure will break apart the current blended rate to now include a Fixed Charge, Energy Charge, and a new Demand Charge component. In preparation for this new way of thinking about your electric consumption, the following information will help members better understand demand as it relates to their energy use.

What is demand?

Demand refers to the maximum amount of electrical power that is being consumed at a given time, as opposed to energy which is the amount of power used over a period of time.

The new Demand Charge line item that now appears on your monthly bill represents the 15-minute interval with the highest amount of electricity used during that billing month—measured in kilowatts (kW).

FOR EXAMPLE: Get in the driver’s seat of your car for a moment. Energy (kWh) would be what is recorded on your car’s odometer—a measurement of total miles. Demand is like your speedometer—measuring the speed at which the energy flows. The demand charge is like the highest recorded “miles-per-hour” speed that month.

[Understanding the Demand Rate]

Why the change to a demand rate?

Electric rates have traditionally been a blend of costs. The cost of fuels to generate electricity, the cost to deliver the energy to your home, the cost to the cooperative to maintain and repair the system, even the cost of billing is included in the rates you pay – and we all share in the overall cost for power and peak charges.

However, there have always been members whose usage patterns impacted our system more than others. So, for some members they may be paying less than their actual impact and others are paying more than they should – even when they are doing all the right things to keep costs lower.

We now have access to more information about how individual members use power. We have information about every member’s energy consumption in 15-minute increments, and we can actually determine how individual households are impacting our system. This additional information allows us to break apart the various components of your electric bill and charge you more fairly for the two largest drivers of your electric consumption:  your impact on the electric system (your demand), and amount of power you consume (your energy use).

[Understanding Utility Costs]

How do I know what my demand was?

Your electric bill now includes a new line item associated with your energy consumption: a Demand Charge. The Demand Charge reflects your highest 15-minute interval of energy consumption during that billing period, which is measured in kilowatts (kW). The demand component did not have a charge associated at first to help you understand how your usage and demand correlate. The Demand Charge became effective with usage beginning Jan. 1, 2019, so members began seeing charges on the Demand Charge line item on statements mailed out in February.

The Power Portal is United Power’s newest resource for members, and offers a detailed look at monthly energy consumption data and overall usage history. This free online resource allows members to view monthly, daily and hourly energy use by 15-minute intervals, and presents your demand with an easy-to-see orange line. The Power Portal provides the information you need to help you pinpoint the exact day and time you hit your demand. Learn more about using the Power Portal here.

[Viewing Your Demand in the Power Portal]

What has the biggest impact on my demand?

Major appliances used for heating and cooling, cooking, and laundry are your home’s largest energy consumers and have the greatest impact on your overall energy usage and demand. The more appliances or devices you run at the same time, the higher your electricity demand.

Depending on your home, family size and appliances, your demand will vary, and your highest demand season may be different from other members.

  • In the summer months, your demand may be higher due to air conditioning, pool pumps, fountains, hot tubs, irrigation motors or power tools and compressors.
  • In the winter, demand is driven by electric heat or space heaters, stock tank heaters, heat lamps, electric fireplaces, and increased usage for holiday lighting, cooking and entertaining.

Understanding the wattage ratings of your household appliances will help you take even more control of your energy bill. Listings of common wattage ratings can be found online or you can measure your appliance wattage usage by using tools like a Kill-A-Watt monitor.

How can I control or lower my demand?

Staggering the use of major appliances will be the easiest way to manage your electric bill under the new rate structure. When you consistently stagger the use of major appliances so they don’t run at the same time, you can keep your demand low. Make it easier by utilizing technology that helps you remember to offset energy use like timers, delay start settings, mobile apps, and programmable thermostats.

Here are some helpful tips to manage your demand:

  • Run the dishwasher after you’re done cooking dinner. Even better, use the delay start feature so your dishwasher runs later at night while everyone is in bed.
  • Start your clothes washer before you go to bed in the evening, and then run the dryer after everyone has finished cooking breakfast the following morning.
  • Grill outside or use small cooking appliances if the air conditioning is running. (Bonus: you won’t overheat your kitchen on a hot day!)
  • Set your electric vehicle charger to run after you’ve you turned off other appliances for the day.

Small changes in how you use your household appliances will help you see the corresponding effect to your energy and demand, and United Power’s new demand rate will put you in the driver’s seat of your electric bill.

[How to Save on the Demand Rate]

How much will this new rate cost me?

In November, United Power’s Board of Directors approved a 2019 rate change that separates energy (kWh) and demand charges (kW) and includes a modest 1.5-2% rate increase for most members. Demand charges will be effective with Jan. 1, 2019 usage and begin appearing on statements mailed in February. The changes to the rates affect all existing residential, time of use and small commercial rates. The rate change also includes the addition of a new Smart Choice Rate that takes the demand concept a step further.

The demand charge represents the 15-minute interval with the highest energy consumption over that billing period, which is measured in kilowatts (kW). While we added a $1 per kW demand charge, we reduced the amount you pay for energy.

The example here shows the impact to the average United Power residential member, who uses 865 kWh per month in energy and has a demand of 6.97 kW. Of course, some members may see a larger variation in their bill. Maybe their demand is very high, and their bill may be several dollars higher than under the old rate.







[Legal Notice as published in the Denver Post & Longmont Times Call]




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