Rate changes to take effect April 1, 2020
Many factors are considered when setting rates, but the most important are producing sufficient revenue to cover annual costs and continuing to maintain and improve the reliability of the electric system, while balancing the needs of our members. In order to do this well into the future, BEMC has determined the need to adjust the rates our members pay. Here are the changes that will affect members beginning April 1, 2020:
Base Facility Charge – This fee helps pay for the upkeep of equipment, facilities and right of way programs. All members pay this fee regardless of how much energy they use each month. The base facility charge ensures all members have an equal share in the cost of operating the cooperative. In April, monthly billed members will see this charge increase from $23.00 to $29.75 per month. Prepay members will see this charge increase from $26.00 to $29.75 per month. This is a $6.75 increase for monthly billed members and a $3.75 increase for Prepay members.
Prior to April 1, 2020 Prepay members paid $3 more per month for the base facility charge due to the equipment requirements for this program. Technology and equipment have evolved over time, removing the need for the additional charge. Beginning April 1, Prepay will no longer have its own rate schedule; it will simply be a billing option in the standard rate schedule.
Wholesale Power Cost Adjustment (WPCA) - As a distribution electric cooperative, BEMC does not generate our own power. We buy it from our statewide organization, North Carolina Electric Membership Corporation (NCEMC). BEMC determines a projected cost for power that will be purchased from NCEMC, and the WPCA charge is implemented when the actual or projected cost of power from NCEMC exceeds the cost of purchased power recovered in our retail rate schedules. This charge helps maintain the financial integrity of the Cooperative when the cost of purchased power increases.
Prior to April 1, 2020, the WPCA was made up of a rider of $0.00474 per kWh and a TIER adjustment of $0.00257 per kWh. This was listed on the bill as a total charge of $0.00731 per kWh. Under the new rate schedule, the rider has decreased to $0.00 per kWh and the TIER adjustment has been eliminated, which means members will no longer see this item on their monthly bill. The WPCA rider will only change in the future if approved by the board.
Energy Usage Rate – As of April 1, the rate members pay for the energy they use is $0.10220 per kWh. This is an increase from the previous rate of $0.09690 per kWh, a difference of $0.0053 per kWh.
Coal Ash Management Rider (CAMA) – As of April 1, members will see a charge of $0.00333 per kWh added to their bill for coal ash management. This charge was part of the WPCA since May 2018, but to ensure transparency in our rates, BEMC’s board has elected to make this a separate line item on the bill.
In 2014, North Carolina passed the Coal Ash Management Act requiring Duke Energy to close all of its 32 coal ash ponds across the state over a 15-year period. A portion of those costs have been passed down to Duke Energy’s wholesale customers. As a distribution electric cooperative, BEMC does not generate our own power. We purchase it through our statewide organization, North Carolina Electric Membership Corporation (NCEMC), which is a wholesale customer of Duke Energy. The coal ash management costs have been passed down to each electric cooperative in the state. BEMC’s board of directors has evaluated the coal ash management costs from every angle and with transparency in mind, settled on this rider as the best option to cover these fees while minimizing the impact on the membership. Once our portion of these costs are met, this fee will be removed from your bill.
BEMC members began paying coal ash management fees in 2018. These charges were originally included in the monthly WPCA charge that went into effect May 1, 2018. As a consumer-owned, not-for-profit utility, all costs of our business flow directly through to our members, which is why our board worked to keep this fee as low as possible to minimize the impact on our members.
Renewable Portfolio Standard (REPS) - the State of North Carolina requires the increased production of energy from renewable energy sources. This fee allows for the recovery of the incremental costs associated with meeting the REPS requirement. This fee is adjusted annually. As of July 1, 2019, the REPS rider for residential members is $0.20. This fee is not changing on April 1.
The average BEMC member uses 1,000 kWh per month. Below are two sample breakdowns of how the average member will be impacted by these rate changes:
Members who receive a monthly bill (included equalized billing and those who use auto/pay):
As you can see, the average residential member will see an increase of approximately $8.63 per month. Your actual monthly costs will be determined by your energy usage.
As you can see, the average residential PrePay member will see an increase of approximately $5.42 per month. Your actual monthly costs will be determined by your energy usage.