The rates you pay for your electricity depend on several factors. They include how much you use when you use it, and what season you live in.
The cost of your electricity can vary dramatically from provider to provider, even if you’re using the same amount of energy. The key is to shop around and find the best energy plan for you.
Rates are Based on the Amount of Electricity You Use
The amount of electricity your home uses – in kilowatts (kW) or kilowatt-hours (kWh) – is used to determine your rate. Understanding this amount can help you find the right plan for your family’s energy needs.
Using a calculator can also be helpful to get a better idea of how much your household electricity costs. This can be especially helpful if you want to compare rates from several different suppliers.
Your electricity cost is influenced by two things: the price of the fuels used to generate your power and the costs of transporting it to you. The prices for these fuels rise and fall in the market, just like other commodities.
It does not set its energy prices; it sells the energy it buys to you at cost. The company does, however, raise rates to pay for the expenses it incurs for infrastructure upgrades.
Another charge you should know about on your bill is the capacity cost, like Met Ed standard residential electric rates charges to ensure it has enough power plants and other facilities to supply your electricity. This fee can be lowered by reducing your power use during peak hours, which vary by location and season.
You can also take advantage of a time-of-use rate, which offers more flexibility in pricing based on the time you use your energy. This allows you to save money by using significant appliances during off-peak periods or charging your electric vehicle at night.
Rates are Based on the Time of Day You Use Electricity
The time of day you use electricity is a significant factor in determining your electric rate. Many energy providers offer a time-of-use (TOU) plan that charges you different rates depending on the time of day you use power.
You can also choose a fixed-rate plan that charges you the same amount for all kWh of power no matter the time of day, even if the per-kWh rates change based on local electricity prices. These plans are ideal for people who use a lot of electricity in the evenings or on weekends when demand is low, and rates are lowest.
In addition to time-of-use rates, some providers offer fixed-rate plans at contracts that last anywhere from six to 36 months. These are typically the best options if you want to save money on your electricity bills over time.
Regardless of your chosen plan, you can reduce your residential electric bill by reducing your energy consumption. You can also lower your energy costs by switching to a provider that offers a better electric rate.
Electricity is expensive for residents and businesses, so shopping for the best rates is essential. Fortunately, many online resources can help you find the right plan for your home or business.
Rates are Based on the Season
The season is a period distinguished by special climate conditions. It is based on the position of the Sun and Earth and can be determined by either a solstice (for winter and summer) or an equinox (for spring and autumn).
Each season is marked by its light, temperature, and weather patterns that repeat yearly in different parts of the world. These variations in weather and vegetation affect the amount of food available to animals and plants and the ability of people to live in their native habitats.
In many regions, indigenous tribes have defined seasons by the activities of plants and animals in their local environment. These can include the hibernation of polar bears on the Arctic tundra or the growth of plants in tropical rainforests.
Residential electricity rates are calculated based on the kilowatt-hours you use over a specific period, plus a small fixed fee. Some energy rates apply demand charges designed to disincentivize electric consumption peaks.
Electricity prices are based on the cost of providing and operating the electric grid (Delivery Charge) and the market price of electric energy itself (Market Price Charge). Rates are regulated by the Pennsylvania Public Utility Commission, which also sets the “price to compare” a customer’s utility’s energy charges to that of competitive suppliers.
Rates are Based on Your Consumption
Residential electricity rates vary based on the amount of energy you consume. Your energy bill includes a small fixed charge and a charge for each kilowatt hour (kWh) of electricity used.
Rates also may include demand charges, which are applied to significant residential developments and commercial clients whose consumption reaches its maximum during specific periods. These charges are designed to disincentivize peaks in usage that can bring the power grid to its limit.
Many residential customers have smart meters, which allow them to shift their electricity use during peak times and save money. Time-of-use (TOU) rates offer these savings opportunities by charging lower prices during off-peak energy periods.
To find out if TOU rates are correct for you, complete the Benefits Worksheet. Then, contact us to set up your TOU meter.
Time-of-use (TOU) is an option offered to residential customers with smart meters. It allows customers to shift their electric use out of the high-price periods during the summer months.
PG&E’s standard residential electric and natural gas rates are tiered, where the price of energy increases as more energy is used during a billing cycle. This is done as required by California law to encourage energy conservation.