Typical Electric Bill Calculation

Figure 22-2 is a sample electric rate tariff for a seasonally differentiated electric rate. In this example, assume that the customer's electricity usage in August was 200,000 kWh and the peak demand was 1,655 kW The energy rate is adjusted to account for the FAC and the nuclear decommissioning surcharge. To the base rate of $0.05890 per kWh, $0.00123 is subtracted to account for the fuel adjustment and $0.00074 per kWh is added to account for the surcharge. The resulting net energy charge is $0.05841. Note that the FAC varies each month and can be either positive or negative. The monthly charge for energy is therefore: 200,000 kWh x $0.05841 per kWh = $11,682.00 The monthly charge for demand is: 1,655 kW x $10.02 per kW = $16,583.10

Add the service charge: $71.29

The resulting total pre-tax utility bill is: $28,336.39

The total bill for the month is: $29,979.90

If the customer had used no electricity during the billing month, and the highest demand in the previous 11 months is assumed to be 1,890 kW, the pre-tax bill would be only the service charge of $71.29, plus a minimum (demand ratchet) charge of:

for a total of $8,708.59. Adding on the state and city tax of 5.8% results in a final bill of $9,213.69 for the month. This extreme example illustrates the importance of accounting for all elements of the rate structure. Had the demand charge been ignored, the bill calculation would have been grossly underestimated.

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