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The Basics:
Delaware Electric Cooperative's Board of Directors has approved a comprehensive rate restructuring plan with the goal of ensuring the cost of providing reliable electricity to hundreds of thousands of Delawareans is shared equitably among those we serve. The overwhelming majority of our members will see a rate decrease. This is the first extensive rate restructuring process the Co-op has undertaken in decades. The changes approved by the Board by are meant to ensure the Cooperative is covering the fixed costs associated with providing basic electric service to members and to ensure our various rate classes are not subsidizing others. In other words, we want to make sure rates are fair to all members. The rate decrease for most members comes as other electric companies serving Delaware have announced significant rate increases. On average, Delaware Electric Co-op members pay $500 less per year in energy costs than those served by the other Delaware utilities. Our rates are some of the lowest in the region. As a not-for-profit utility, our goal is to provide you with affordable and reliable power.
The plan was announced to members in February and the board of directors voted on the proposal during a special virtual hearing held on March 20 at 5:00 p.m. The rate changes will take effect on April 1. Details about what the changes mean for specific rate classes are laid out below. Members with questions or comments about the rate restructuring plan can email [email protected] or call 855-332-9090.
What This Means for Residential Members:
Under the plan, a majority of residential members will see a 3-5 percent decrease in their monthly electric bill, resulting in savings of $60-$95 per year. The average member on our residential rate using 1,000 kWh will see a little more than a 3 percent decrease in their monthly bill. Members currently served by our residential space heating rate who use 1,000 kWh per month will see a 5 percent decrease in their monthly bill as we transition everyone in the space heating rate class to the general residential rate. The space heating rate class is being eliminated as it no longer provides savings to households with all-electric heating.
To pass along the rate decrease to residential members and to ensure fairness among all rates classes, DEC is rebalancing all of the charges that account for your monthly energy costs.
The individual charges that make up your monthly bill are split into two categories: supply and delivery. Supply charges, which include the Power Cost Adjustment (PCA) and an additional supply charge per kWh (how much energy you use) reflect DEC’s cost to purchase and produce power. DEC leaders have proposed lowering the power cost adjustment (PCA) to zero. The PCA accounts for periodic changes in DEC’s cost to purchase or produce energy. Supply charges per kWh account for the general cost to purchase and produce energy and will increase slightly. Overall, the supply portion of your bill will decrease largely because of a drop in the cost of natural gas which is used to generate much of the energy delivered to your home.
The delivery portion of your electric bill that covers the cost to distribute energy to your home and reflects the Co-op’s fixed costs to provide basic electrical service to your home will increase. Delivery charges per kWh, that account for the cost to distribute power to member homes, will decrease slightly and the service charge (formerly known as the customer charge) will increase.
Overall delivery charges are being adjusted because of the dramatic rise in the cost of materials used to maintain our system over the past few years. The service charge will increase from $16 to $28 per month to accurately reflect the true fixed cost to provide basic electrical service to each member. Those fixed costs include electrical infrastructure, technology costs and labor that ensure reliable power is delivered throughout our service territory. Regardless of how much or how little energy a member consumes each month, the cost to provide basic electric service is the same, and Co-op leaders have proposed these changes to make sure those costs are shared equally among members. This is especially important given the significant increase in the cost of materials needed to maintain a stable grid over the past couple of years. For example, a transformer that cost $1,400 in 2019, now costs $4,000.
While the changes impact far fewer members, some rate classes will see a drop in energy costs, while others will pay more per month.
You can find specific information for net-metered members detailing the rate restructuring and other changes HERE.
What This Means for Members on Our General Service Rate:
Members served under our general service rate will see an increase in their monthly energy costs. The average member on our general service rate using 1,000 kWh per month will see a 6 percent increase in their monthly bill. The supply charges for this rate are currently among the lowest of all Cooperative members. Supply charges help the Cooperative pay for the general cost of generating or purchasing electricity for homes and businesses. To ensure members in other rate classes aren’t paying for the infrastructure used to power general service members, supply charges for this rate are being raised to levels consistent with other DEC rates. While this is fair to other members, this rate class is one of the few that will pay more under the restructured rates.
What This Means for Other Rate Classes:
Non-residential rate classes are also being restructured. Your rate classification is listed on your monthly electric bill. While these changes impact far fewer members, some rate classes will see a drop in energy costs, while others will see an increase in their monthly energy costs. Specific information about changes to all rate classes can be found HERE. As noted above, some net-metered members – those with solar or wind generating systems on their homes or businesses – would see a slight increase in their monthly bills. The same rate restructuring process used to determine new residential rates was also used to determine non-residential rates. These new rates reflect the true cost of providing electrical service to these rate classes and are fair to all members.
Ways to Lower Energy Use:
While energy costs for most members are falling, we put together a list of some ways members can help control their energy costs.
More Predictable Bills with Levelized Billing:
Our levelized billing program eliminates the dramatic seasonal changes members sometimes see in their electric bills. When you enroll in the program, the Co-op determines your new monthly payment by averaging your past 12 electric bills. The monthly billing average is recalculated in March and September. Members must meet specific criteria to be enrolled in the program. Enroll by logging into your online Smarthub account or our app, DEC Connect. Members can also call 855-332-9090.
Energy Insights Bill Analysis:
Our Energy Insights program provides members with a detailed analysis of their bills, home energy usage and helpful tips to save energy. You can even receive a weekly energy use forecast projecting your home’s weekly energy costs. Access the program HERE.
Home Energy Audits:
DEC members can receive a home energy audit for just $50 through Energize Delaware. After signing up for the program, an energy expert will examine your home and offer suggestions to improve your home’s comfort, energy efficiency, durability, and safety. Your energy advisor will also provide and install up to $200 worth of energy-saving measures in your home at no additional cost. Call 1-877-524-1339 to learn more.
*For Members Who Need Assistance: If you are struggling to pay your electric bill, we’ll connect you with organizations that can help. DEC partners with several Delaware nonprofits to assist those who are unable to pay their electric bills. You can find a full listing of agencies at www.delaware.coop/member-services/billing.