Factors that impact electricity prices
Inflation has impacted the price of everything including gasoline, eggs, and the costs for fuels required to produce electricity. There are a few key factors that impact electricity prices and energy bills.
The three primary components of your monthly electric bill include: an energy consumption charge, a service availability fee and a cost of energy adjustment charge. To understand your total energy costs and what impacts your bill, let's examine each area.
The first component of your monthly bill is the energy consumption charge, which covers how much energy you consume. You've likely noticed the amount of energy you use can vary from month to month and is typically impacted by extreme temperatures. When temperatures soar or dip, your cooling and heating equipment operate more, which increases your home energy use. Energy consumption is an area that you have some control over, and you can lower your monthly bill by actively reducing energy use.
The next component is a fixed monthly service availability fee, which covers the costs associated with providing electricity to your home. This includes equipment, materials, labor and operating costs necessary to serve each meter in our service territory, regardless of the amount of energy used. In order to ensure the reliable service you expect and deserve, we must maintain the local power delivery system, including power lines, substations and other necessary equipment. Like many other businesses, we've experienced supply chain issues and steep cost increases for some basic equipment.
Because energy costs change regularly, the cost of energy adjustment may be a credit or charge on your bill each month, depending on current energy prices and the amount of energy used. It covers wholesale fuel cost fluctuations without having to continually restructure electricity rates. It's a direct pass through, with no markup.
While we can't control the weather or the rising costs of fuels, please know Rich Mountain Electric Cooperative is doing everything possible to provide you with the most Affordable, Reliable and Responsible power possible.
We take our mission to provide our members with Affordable, Reliable and Responsible energy seriously.