Your electric bill may be changing.
The following explains the updated rate-restructuring proposal discussed at the December OPPD Board of Directors committee meetings, which is to be voted upon at the regular board meeting on December 17.
OPPD is always working hard to maintain the right balance of affordability, reliability and environmental sensitivity for our customers. We are looking at ways to help maintain this balance, and we want you to know more about how we are rethinking rates.
Updated Rate-Restructuring Proposal
Since our original rate-restructuring proposal was discussed at the OPPD Board of Directors meeting on November 12, 2015, we have received additional feedback.
As part of our commitment to listen to our customers throughout this process, the OPPD Board discussed an updated proposal at its December committee meetings, and is to vote on the same at its December 17 regular board meeting.
Updated Proposal Highlights:
- Proposed increase in monthly service charge reduced by $5 or 15 percent.
(Service charge is fixed charge on monthly electric bill.)
- Low Usage/Low Income (LU/LI) Transition Program, which will give these customers more time to adapt to rate restructuring.
- View presentations on both of these topics.
Regarding the proposed increase in the monthly service charge for residential and small commercial customers, we have reduced our original proposal by 15 percent. Instead of gradually increasing the charge to $35 by 2019, we are capping it at $30 by 2019.
The current service charge covers a limited amount of the costs incurred to serve every customer, including meters, meter reading, billing and customer service. By 2019, OPPD’s proposal would include all customer and distribution costs as part of the fixed portion on the monthly bill.
As with the original proposal, the increased service charge would be accompanied by a decrease in the usage charge.
To illustrate how the proposed new rate structure may impact your bill, OPPD has categorized customers into three groups, based on their monthly charge for kilowatt-hour (kWh) usage.
- Low: Less than $80 kWh usage charge
- Medium: $80-$125
- High: More than $125
The charts below show a phased-in service charge, starting at $15 in June 2016, and going to $30 in 2019.
The net impact of the updated proposal would result in low-usage customers paying $2 to $12 more on their monthly electric bill.
Note: Not all low energy users are part of the low-income population. About 60 percent of OPPD customers who are low energy users also have low incomes.
For low-usage customers who have low incomes, OPPD has developed a Low Usage / Low Income (LU/LI) Transition Program.
Low Usage/Low Income Program Highlights:
- This program would provide more time for these customers to adapt to the rate restructuring.
- Customers would qualify if they use less than 600 kilowatt-hours (kWh) per month and are enrolled in the state Low Income Home Energy Assistance Program (LIHEAP). Customers must apply for LIHEAP annually.
- Once a customer is LIHEAP-qualified for a specific year, their monthly usage would be evaluated during each of the 12 bill cycles to determine if they are eligible for a credit on their bill for that particular month.
- Credits would start at $2.50 per bill in June 2016, and increase to $7.50 per bill by Jan. 1, 2019.
- Starting in January 2020, the credit would decrease to $5, and end completely by June 1, 2020.
- For qualifying customers, instead of seeing an average $9 monthly increase by 2019, they would instead see a $1.50 monthly increase that year.
- Approximately 15 percent of OPPD’s low-income customers would be ineligible for monthly credits, while 18 percent would receive credits for all 12 months.
The charts below show: 1) the timing and progression of the proposed service charge and LU/LI credit, and 2) the estimated impact on three customer types based on the updated rate restructuring proposal and LU/LI Transition Program in 2019.
Background Information: Why Restructure Rates?
Today, 90 percent of your bill is based on how much energy you use. This has been the common practice for utilities across the country.
But only 30 percent of OPPD’s costs are related to how much energy our customers use. The other 70 percent is spent on infrastructure, equipment and personnel – things that we need to pay for no matter how much energy is consumed.
And with trends like rising costs and the slowing growth of energy usage due to energy awareness, increases in energy efficiency and new technologies, we need to find a new way to maintain balance.
OPPD is considering raising the service charge for all residential and small commercial customers. At the same time we would be lowering the usage charge – the amount you pay for the electricity you use. (Our large industrial customers already have a billing structure that adequately covers their portion of the fixed costs.)
These changes would not bring in any additional revenue to OPPD, but would more accurately reflect the cost of providing reliable service to our customers.
If you would like to learn how your account may be impacted, fill out a online comment form and include your phone number in the comment box, and someone will contact you.
How We Reached Out To You
Over the last several months, we sought our customers’ input on the proposed rate restructuring through:
- 10 focus groups (8 for residential customers, 2 for commercial)
- 8 public open houses across our service territory
- Online comments made via OPPDListens.com
- Online research panel (1,380 residential customers with low/average/high usage levels)
For More Information
The Energy Assistance Program can help you pay your energy-related expenses. View or download more information.
Our Level Payment Plan option will eliminate surprises in your bill by letting you know exactly how much your monthly payment will be no matter the weather. View or download level payment plan information.
Send Us Your Comments
Provide your comments online using the online comment form and let us know your thoughts about rate restructuring!
Provide affordable, reliable and environmentally sensitive energy service to our customers.
OPPD Is Committed to:
- Listening to, understanding and appreciating its customers, employees and stakeholders and their issues and concerns.
- Partnering with customers, employees and stakeholders.
- Continuing to build relationships with all customers, employees and stakeholders.