Straight Talk About Your Electric Bill

The cost of energy

Prices for almost everything have increased over the past few months. Like other utilities across the country, SMECO has faced rising costs for natural gas, which generates more than half of the power that we purchase for our members.

The chart below shows how the monthly average cost has changed for each of the following: SMECO’s residential energy rate, PJM’s wholesale price of electricity, crude oil, and natural gas. In January 2020, SMECO’s rate was 6.95 cents per kWh, the PJM price was $25.55 per MWh, crude oil was $57.52 per barrel, and natural gas was $2.02 per mmBTU. As of March 2022, SMECO’s rate was up 39% to 9.66 cents per kWh, while the other commodities were higher by 89% to 143% at $50.50 per MWh, $108.50 per barrel, and $4.90 per mmBTU.

Relative change in commodity prices, January 2020 to March 2022

SMECO’s Standard Offer Service (SOS) rate for energy is made up of an energy charge and a Power Cost Adjustment (PCA). The total is the SOS rate members pay on their monthly bill. The SOS rate reflects the price that SMECO pays on the wholesale market. There is no mark-up. SMECO makes no profit on the SOS rate.

The chart below shows how SMECO’s residential energy rates have gone up and down over the past three years.

SMECO’s residential SOS energy rates

When SMECO’s PCA is more than five percent (up or down) of the residential energy charge for three months in a row, SMECO is required to file for a rate adjustment with the PSC to go into effect three months later.

SMECO’s SOS residential winter energy rate, in effect October through April, is 8.33 cents per kilowatt-hour (kWh). SMECO’s summer rates, which went into effect May 1, are currently 7.8 cents per kWh. SMECO submitted a filing to the Maryland Public Service Commission (PSC) on April 29, 2022, that if approved, will adjust the summer rate to 8.17 cents per kWh and go into effect with the July 2022 bills.

The chart below shows the SOS rate and shows how much you would have paid for energy if you used 1,000 or 2,000 kilowatt-hours (kWh) each month.

Monthly energy costs (residential)

Month Total Energy Rate
(cents per kWh)
1,000 kWh
per month
2,000 kWh
per month
Nov. 2021 7.0816 $70.82 $141.63
Dec. 2021 7.1093 $71.09 $142.19
Jan. 2022 7.4822 $74.82 $149.64
Feb. 2022 8.9922 $89.92 $179.84
Mar. 2022 9.6616 $96.62 $193.23
Apr. 2022 9.4617 $94.62 $189.23
May 2022 8.8416 $88.42 $176.83

The chart above shows temperatures from January 1 through April 30, 2022. Compare the average temperature with the average amount of energy SMECO’s members used each month, and you will see that when the weather is colder, people use more energy.

Month Avg. Temp.: Avg. KWh Used: Total kWh:
Nov. 2021 44.9 degrees 869 kWh 135.7 million
Dec. 2021 45.2 degrees 1,198 kWh 187.0 million
Jan. 2022 32.0 degrees 1,403 kWh 219.1 million
Feb. 2022 40.2 degrees 1,705 kWh 267.1 million
Mar. 2022 47.8 degrees 1,208 kWh 189.7 million
Apr. 2022 54.2 degrees 998 kWh  157.0 million

Energy use changes seasonally

When it’s cold in the winter and your heating system runs, or when it’s hot in the summer and your air conditioning runs, your bill will be higher. Your bill is at its lowest in May and October, because you typically use less energy in those months. The chart below shows the average monthly temperature from December 2020 to April 2022.

Control your water heating costs:

  • Set your water heater thermostat between 120 to 125 degrees.
  • Use cold water whenever possible, such as when washing clothes and only run full loads.
  • Insulate your water heater (check manufacturer recommendations).

Time-of-Use Rates

During peak times, energy costs are higher for SMECO, and during off-peak times, costs are lower. On SMECO’s SOS rate, the per-kWh cost doesn't fluctuate. But, for customers who choose SMECO’s Time-of-Use (TOU) rate, energy charges will reflect the peak and off-peak price difference.

TOU rates can help customers save money if they use less energy during peak times. To shift energy use, residential customers can run kitchen and laundry appliances, pool pumps, and other equipment during off-peak hours. Find out more.

How can you budget your bills?

Sign up for SMECO’s Budget Plan to make it easier for you to pay your monthly bills. The plan is a fixed amount that levels out the effect weather has on your electric bills.

Contact SMECO for more information.

SMECO Energy Rates

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