Rate Schedules

These past few years we have seen unlikely and unpredictable outcomes associated with the cost of market power, the disruption of power supply, and the increased interest rates and prices of materials. This has not only affected the utility industry but affected costs to us all in every aspect of everyday living.

In 2020, we were able to decrease our overall rates by 1.5%, and in 2021 an additional 2% decrease, for a total of a 3.5% rate decrease. Additional costs had been absorbed for the most part into the Power Cost Adjustment (PCA) on your monthly bill. 2022 year-end numbers showed us that our costs were up 10% and revenue was down 5%.

Our participation in cooperative-based wholesale power has allowed us to have the reliability in power supply and moderately in price. This business model has protected us from immediate fluctuations in the energy market and sheltered us from raising rates last summer when the energy market prices spiked. Southern Illinois Power Cooperative (SIPC), our wholesale provider, makes up 66% of our costs. That leaves 34% to cover depreciation, interest, taxes, operations, maintenance, administration, and other general costs.

Due to economic factors and their increased costs such as natural gas and coal, they implemented an immediate 4% increase to us in January of 2023. From 2019 to 2023, we have witnessed a nearly doubling of everyday construction materials and in fuel costs. Wire to build one mile of single-phase line, including a typical single phase aluminum wire with neutral, in 2019 would have costs $1,650 and today over $3,200. Pad-mounted transformers have seen not only a 70-100% increase in costs, but three-times longer lead time, making them less attainable. 

Materials	2019	2023	Units
#2 ACSR (conductor)	$0.15	$0.29	/foot
35′ Pole	$221	$419	/pole
25kVA transformer	$1,342	$2,275	/transformer
Diesel Fuel	$2.94	$4.27	/gallon

General Service – Rate Schedule A

USAGE MONTH	BILLED MONTH	ENERGY CHARGE (/KWH)	POWER COST ADJUSTMENT (/KWH)	DELIVERY CHARGE (/KWH)	DELIVERY COST ADJUSTMENT (/KWH)	BUNDLED ENERGY COST (/KWH)
FEBRUARY 2023	MARCH 2023	$0.03630	$0.01400	$0.06920	$0.00000	$0.11950
MARCH 2023	APRIL 2023	$0.08950	-$0.00540	$0.03050	$0.00500	$0.11960

New 2023 rate changes don’t just include differing costs, but additional unbundling of the bill. In January of 2021, we revised our billing format so you could easily see what you pay, such as electric supply and residential distribution delivery charge in an unbundled manner, along with the Power Cost Adjustment (PCA), which has always been a standalone charge or credit per policy to address fluctuating costs.

The Delivery Cost Adjustment (DCA) will be an offshoot of, or a portion of, the PCA line item. The PCA is currently associated with only the electric supply of power and not the delivered energy. Adding this line allows us to equitably assess these variable costs to which charge they are associated with.

This past summer we discussed that the perceived scarcity of power capacity in early 2022 that drove up energy market pricing, signaling the potential for rolling blackouts that would be caused by a peak usage event. This experience has expedited our wanting to manage load more effectively as a cooperative to lower our overall demand on the grid. Potentially needing less capacity would position us to better manage these events as well as allow us to pay less money to our power supplier.

A Residential Demand line was added onto the bill early 2023 with no costs associated with it. Our bill from our power supplier includes two lines – energy (kilowatt-hour, kWh) and demand (kilowatt, kW). Power cost on a large scale aligns heavily with the demand placed on the system and the time at which it occurs. Our goal has always been, and continues to be, to best recapture costs needed to operate our business at the lowest cost possible. In 2023, the Residential Demand will have an associated charge of $0.10/kW. Depending on everyone’s individual demand this additional line at $0.10/kW could be estimated to be anywhere from a $1.00/month (10kW) charge to $2.50/month (25kW).

Another change implemented is breaking apart the service availability charge into two pieces – Service Availability & Metering Charges, and into a daily charge opposed to monthly. Our cost of service studies are broken apart similarly but will be no change in cost. The previous $38.50 overall cost remains the relatively the same but calculated differently. The service availability was broken into a $1.075/day charge, and for a 30-day month this would be $32.25/month, and the metering charge was broken into a $0.191/day charge, or a $5.73/month charge – for a total of $37.98, or $39.25 for 31-day months. This was done to levelize the flat charges over unequal months and to standardize prepay & partial month billing practices, that is already being manually calculated in days.

Below is defined each charge listed on the bill with the explanation of that charge.

DISTRIBUTION DELIVERY CHARGES

• • Service Availability Charge – Recurring fixed flat daily charge that recovers a portion of our fixed cost of providing electricity and distribution structures (such as wires & transformers outside of metering) to your home or business, regardless of usage.
  • Metering Charge – Recurring fixed flat daily charge that recovers our cost to provide metering services to your home or business. This was previously included in the Service Availability Charge.
  • Delivery Charge – Is a variable charge based on usage, kilowatt-hours (kWhs), consumed during the billing period, multiplied by the rate. This reflects EECA costs related to right-of-way clearance, line maintenance, billing, accounting, fleet, and other Cooperative expenses incurred.
  • Delivery Cost Adjustment (DCA) – Reflects the fluctuating increases and/or decreases in the EECA distribution & delivery costs (such as inflationary & supply chain costs) each month.

ELECTRIC SUPPLY CHARGES

• • Energy (kWh) Charge – the production & transmission cost of kWh consumed from our wholesale power supplier, Southern Illinois Power Cooperative (SIPC), for the billing period.
  • Demand Charges (kW) – The highest peaked kilowatt (kW) reading captured and reported during the billing period or month. The kW is then multiplied by the demand rate(s). Demand is not a cumulative charge, but is a measurement of the maximum amount of power required during any one (1) fifteen-minute interval within our billing period, measured in kilowatts (kW). Simply put, demand measures your impact on our electric distribution system to deliver that power.
  • Power Cost Adjustment (PCA) – Reflects the fluctuating increases and/or decreases in the wholesale power purchased each month.

We understand the smallest of a rate increase affects our member-consumers, and some more substantial than others. We are always happy to make accommodations when life happens by contacting our office. We have implemented many different ways to pay – our Sparta kiosk was moved to the Neighborhood Grocery Co-op on the west side of Carbondale. We also launched Vanilla Direct that allows you to make payment by scanning your bill stub at any Dollar General, Walgreens, CVS, or Wal-Mart location for a nominal third-party fee. We also offer energy audits in efforts for you to increase efficiency, eliminate energy waste and utilize less energy. We also offer budget billings that can help better budget your monthly expenses.

As a cooperative that is owned by the membership, we are obligated to pass through the costs needed to meet our debt requirements to protect the cooperative. We do not seek to earn profits for investors, and that we are built and managed by the communities we serve. Please remember, any profits made this year, as all other years, will be allocated back to our membership each year to be paid in patronage capital in future years to come. Our mission remains the same – to always strive to provide you with safe and reliable service at a reasonable cost.

Q&A

What is EECA’s service availability charge, and why is it now split into two parts – service availability & metering charges?

EECA serves on average 7.5 members per mile of line, whereas investor-owned utilities (IOU), such as Ameren, serves on average 35+ members per mile. Additionally, about 88% of EECA’s meters are residential, whereas the IOUs have a much higher number of commercial and industrial customers and revenue in more concentrated areas. All of this means that IOUs receive 5 times more revenue per mile of line than EECA does, and therefore IOUs are much better positioned to spread their fixed costs to their customers. EECA is at a significant disadvantage due to the rural nature of our service area.

For many years, our cost-of-service studies have shown that we’ve been significantly under collecting on the flat monthly service availability charge. These studies have indicated that the actual cost of having service available in our rural area should be even higher yet.

Moving forward in 2023 we have broken apart the service availability charge into two pieces – Service Availability & Metering Charges, and into a daily charge opposed to monthly. Our cost-of-service studies separate out these two lines, and therefore we are similarly doing the same. Although the daily charge will reflect slightly differently month-to-month based on the number of days in the month, there is no overall change in cost to the membership over the course of the year.

What does the Service Availability & Metering Charges represent?

The charges ensure that expectations for reliable power and high-quality member services are met. It gives each member a fair and equal share of the cooperative’s operations. It provides funds that must be invested now to maintain the quality, reliability, and integrity of service that our members have traditionally counted on and come to expect.

Among expense items covered by the two charges are:

• Service Availability Charge – Recurring fixed flat daily charge that recovers a portion of our fixed cost of providing electricity and distribution structures (such as wires & transformers outside of metering) to your home or business, regardless of usage.
• Metering Charge – Recurring fixed flat daily charge that recovers our cost to provide metering services to your home or business. This was previously included in the Service Availability Charge.

These charges represent the costs for:

• Trucks, wire, transformers, power poles and labor needed to build and maintain the electric distribution system;
• Keeping pace with increased system investments to improve both capacity and reliability;
• Implementing new technologies to provide increased reliability and operational efficiencies, such as our outage management system and advanced metering infrastructure; and liability insurance, interest, taxes and emergency storm restoration.

Because all cooperative members benefit from having reliable electric service available when they want it, the service availability and metering charges ensure that everyone pays a fair share of basic costs, that exist whether or not a single kilowatt-hour is used.

Why do the fixed (service availability & metering) charges seem so high?

If one member uses only 1 kilowatt-hour (kWh) of electricity and another member uses 100 kWh of electricity, EECA still incurs about the same cost to build the line, maintain the distribution system, deliver electricity, calculate, and bill each member. It takes just as much equipment to deliver 1 kWh as it does 100 kWh. Therefore, each member must pay the fixed costs that are associated with their size of service to maintain the financial health of the cooperative. EECA is at a significant disadvantage due to the rural nature of its service area, and with 7.5 members per mile of line, fixed costs are higher than more densely populated utility providers. Regardless of consumer density, Egyptian Electric has an obligation to meet our members’ needs and our financial obligations.

What is demand?

When we pay our monthly bill to our power supplier we pay for energy and for demand, with demand being the largest portion of that bill. Power cost on a large scale aligns heavily with the demand placed on the system and the time at which it occurs.

Demand is the highest peaked kilowatt (kW) reading captured and reported during the billing period or month. The kW reading is then multiplied by the demand rate. Demand is not a cumulative charge, but is a measurement of the maximum amount of power required during any one (1) fifteen-minute interval within our billing period, measured in kilowatts (kW). Demand has always been a component of industrial, commercial or large power consumers’ bills. Simply put, demand measures your impact on our electric distribution system to deliver that power at a given time.

Spreading out the use of major appliances (rather than all at one time), doing laundry and other chores that require significant amounts of electricity later in the evenings, and setting timers and programmable functions to run outside of in-home high usage times such as pool pumps or other appliances can help reduce your demand.

What is Power Cost Adjustment & Delivery Cost Adjustment?

In January of 2021, we revised our billing format so you could easily see what you pay, such as electric supply and residential distribution delivery charge in an unbundled manner, along with the Power Cost Adjustment (PCA), which has always been a standalone charge or credit per policy to address all fluctuating costs – internally & from our wholesale power provider.

The Delivery Cost Adjustment (DCA) will be an offshoot of, or a portion of, the PCA line item. The PCA is currently associated with only the electric supply of power and not the delivered energy. The DCA addresses the delivered energy (EECA) cost fluctuations month-to-month. Adding this line allows us to equitably assess these variable costs to which charge they are associated with.

How do EECA’s residential rates compare to other coops in Illinois?

The Association of Illinois Electric Cooperatives internally publishes a residential rate comparison annually so that Illinois Cooperatives can see where they compare to other Illinois Cooperatives. In 2021, Egyptian Electric Cooperative was estimated to be the 7th lowest overall average residential rate of all Illinois Electric Cooperatives.

What causes EECA rates to increase?

Due to economic factors and their increased costs such as natural gas and coal, our wholesale power supplier implemented a 4% increase in January of 2023.

From 2019 to 2023, we here at EECA have witnessed a nearly doubling of everyday construction materials and in fuel costs. On a wholesale and distribution level, the cost to do business, buy materials, as well as supply-demand pressures are driving the costs in all aspects of our business to increase.

Instead of continuing to refund capital credits to active and inactive members, why not use those funds in place of a rate increase?

Egyptian Electric Cooperative is a not-for-profit electric cooperative. Our not-for-profit status mandates that any net margins (profits) made by the cooperative must be allocated to the membership in the form of capital credits. Capital credits are allocated to each member of the Cooperative every year based on participation in the Cooperative. This is a primary difference between a for-profit investor-owned company and a cooperative. It is what happens to revenue above and beyond annual operating expenses. An investor-owned (for-profit) company disperses excess revenue (dividends) to its investors. A cooperative, on the other hand, distributes excess revenue to its members in proportion to their contribution of the revenue. The more you contribute to the revenue through your electric purchases, the more that’s returned to you when there is excess revenue. Refunding patronage capital does not affect our margins (but does impact our balance sheet). Part of the premise of a cooperative is having members as investors and giving members a return on equity over time. Active and inactive members who have been on our lines for many years paid patronage capital and deserve a return on those investments.

Can I choose another electric provider?

No. EECA is a distribution cooperative, so even if electric customer choice was practical, EECA would still have a distribution cost structure and would still be the distribution provider. Members do have choices: wind turbines, solar panels, permanent standby generators, propane, or natural gas, however, those can be significantly more expensive and not always reliable.

Who determines when a rate increase is necessary and by how much?

EECA Board of Directors and management staff continuously monitor the financial stability of the organization to determine if or when a rate increase is necessary to meet the financial obligations of the cooperative. From time-to-time, cost of service studies are conducted to analyze current financial needs as well as those projected into the future. Rate schedule modifications are presented to the board, as needed, for approval before implemented.

I understand that Egyptian Electric has an Operation Round Up program to help those in need in the community; are my rates being increased to support this program?

No. The Egyptian Electric Cooperative Charitable Fund dollars have helped provide support to organizations across our service territory. The program is opt-in and funds to support this program are not included in overall electric rates or cooperative budget. In fact, this program is funded by the generosity of our members who contribute to our Operation Round Up® program by allowing their electric bill to be rounded up to the next whole dollar amount each month, as well as numerous contributions by our board and cooperative employees.

I understand that rates must immediately increase, but is another rate increase anticipated and when?

While Egyptian Electric did not have a rate increase in the previous five years, there were several factors that led to rate changes for 2023 and will come into play with rates for 2024. Many of these are unplanned and are tied to rising costs for coal, natural gas, the energy market, storm restoration efforts, legislation requirements, etc. The future of energy is uncertain and are expecting to see another wave of financial pressures in 2024.

We are committed to doing our best to minimize the impacts to our members by being proactive in our power supply and operational planning. We are committed to maintaining the reliability, quality, and integrity of our electric system.

What can I do to reduce my electric costs, and can Egyptian Electric provide any assistance in this area?

We understand the smallest of a rate increase affects our member-consumers, and some more substantial than others. We are always happy to make accommodations when life happens by contacting our office. We have implemented many different ways to pay – including some coming changes in relocating our Sparta kiosk to the Neighborhood Grocery Co-op on the west side of Carbondale. We will also be launching this spring Vanilla Direct that allows you to make a payment by scanning your bill stub at any Dollar General, Walgreens, CVS, or Wal-Mart location for a nominal third-party fee.

We also have our SmartHub app where you can not only pay your bill on the spot, you can set up recurring payments and monitor your energy usage. We can also enroll you in a budget billing, a more budget-friendly payment calculation method.

We also offer energy audits in efforts for you to increase efficiency, eliminate energy waste and utilize less energy. Heating, cooling, and hot water are a home’s largest energy loads, typically accounting for more than 60% of a home’s total energy use. You do have a choice of competing fuels and efficiencies for these, as well as the choice of insulation and appliances in your home. Members may find helpful information about conserving energy and energy audits on the EECA website, eeca.coop, which includes:

• Touchstone Energy® Cooperatives Home Energy Adventure
• Links to Touchstone Energy® Cooperatives savings brochures
• Your Unique Energy Needs Guide
• Building the Home of Your Dreams Guide
• Energy efficiency tips
• Energy Evaluations webpage

In addition, Touchstone Energy savings brochures may be mailed to members. You may also refer to the Illinois Country Living magazine where we traditionally publish energy-saving tips as a part of our monthly local news pages.

For those who qualify for the state’s low-income home energy assistance program (LIHEAP), contact your local action agency, or visit helpillinoisfamilies.com to learn more on how you can get energy assistance.

For any further explanation on any of these, please contact us at (800) 606-1505.