Maintenance Engineering Product Tips “What Is Your Electric Rate?”

Your customer’s electric rates may not be what they think. The electric rate published on the bill is seldom the rate you customer is actually paying. there are many fees and taxes that can be added in, which increase your customers’ electric rate.

Some of the items that will change your electric rate are:

– Demand Rate

– Power Factor Correction

– Line Changes

-Service Fees

Electric rates are expressed as dollars or cents per kilowatt hour, it is usually expressed as $._/kwh. this is the rate most customers think about when you ask them how much they pay for electricity.

To determine your customers’ true electric rate, you calculate it by taking the Total Amount to be Paid and divide it by the Total Kilowatt-hour Used:

Total Amount to be paid/ Total Kilowatts Used = True Electric Rate

For example, if the Total bill is $100 and they used 1000kwh the customer’s rate is $.10, but if the Total bill is $150 and they used 1000kwh, their rate is then $.15/kwh. So, changes are, their “published” electric rate is much less than their True Electric Rate.

So, if a customer tells you that energy savings isn’t important since their rate is only five or six cents you may want to have them show you their bill and do the above calculation. they will often be very surprised at what they are actually paying!



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