4/25/2023 0 Comments Mygreenbutton website monitor(It is important to note that both PWP's and SCE's TOU rates put the most expensive energy in the late afternoon to evening time period - pricing energy to offset against the " head of the duck." Ultimately, these rates will create the energy storage market in California, but that is a post for another day. everyday), and "Off-Peak" (all other hours).įor both PWP and SCE there is a seasonal overlay on these rates, with energy costs increasing in the summer months (defined as June 1 through September 30). weekdays - holidays excluded), "Super Off-Peak" (10 p.m. SCE's approach is more involved, dividing the day into three, more complicated segments: "On-Peak" (2-8 p.m. But PWP's TOU rate retains the tiered element as well, making it a truly odd hybrid rate structure. PWP refers to these segments as "On-Peak" (from 3-8 p.m.) and "Off-Peak" (all other hours). Instead, the day is broken up into segments and the cost of energy varies depending on the segment in which it is consumed. Time-of-use rates, on the other hand, are generally not tiered. PWP, on the other hand, has a somewhat perverse tier structure in that the lowest tier is very cheap, 1.7¢/kWh, the second tier is significantly higher, 13.5¢/kWh, but the final tier actually goes down to just 9.9¢/kWh! Since the whole point of tiered rates is to provide an incentive for heavy users to reduce their usage, PWP is actually rewarding those who consume more than 25 kWh per day with lower rates! Very odd. For example, SCE's Domestic rate has three tiers and in the first tier the charge is 8.8¢/kWh, in the second tier the charge is 16¢/kWh, but the final tier is 22.4¢/kWh! (There is also a non-tiered component that adds another 6.9¢/kWh to the customer's bill.) Tiered rates assume that there is some minimally expensive charge for the first allocation of energy per billing cycle, and that as you use more energy your cost for energy increases. That means that there are two or more cost steps - called tiers - for the energy that you use. Most residential electric customers, of both PWP and SCE, are on a tiered rate structure. You have been warned! Defining Tiered and Time-of-Use (TOU) Rates SPOILER ALERT - The following is pretty much down in the weeds. We decided to take a closer look into these rates both for PWP and for the folks in Southern California Edison (SCE) territory. Turns out that is not an easy question to answer, and there certainly isn't a "one size fits all" result. Contact us if you would like to see how simply changing your rate in SCE territory could save you money in the New Year!Ī client of ours noted that Pasadena Water and Power (PWP) offers, in addition to its regular, Residential tiered rate structure, the option to switch to a Time-of-Use rate structure, and he asked if he would derive additional savings from making that switch. While the rates have changed in terms of actual dollars and cents, the underlying premise still applies. Happy New Year! Understanding Tiered vs TOU RatesĮDITOR'S NOTE: This article, first written in October, 2016, was viewed over 2,000 times this year. Thanks to all for their support, to family and friends, but most of all to our clients, who are the reason we do this everyday. Timely manner far more challenging than it should have been.Īs we head into 2019, we thought we would recap our top three most read articles this year-although two of them harken back to prior years, thereby proving that meaningful content can truly be evergreen. I've got solar why is my bill so high?Ģ018 was a tumultous year, including tariffs and equipment shortages, that at times made the task of simply installing systems in a. Run on Sun December, 2018 Newsletter Welcome to the
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