Distribution rate change approved
On December 1, 2022, SMECO filed with the Maryland Public Service Commission (PSC) for authority to increase its electric distribution rates and restructure the rate classes for certain commercial accounts. SMECO received an order from a Public Utility Law Judge on May 1, 2023 authorizing the cooperative to increase its Distribution Charge and restructure its General Service commercial accounts. The new rates will go into effect for bills rendered on or after May 15 for residential members and lighting rate schedules, and June 1 for all other members.
Electric distribution rates recover the cost of delivering electricity to your home or business. This includes costs associated with installing and maintaining substations, overhead poles and wires, underground cables, transformers, fleet vehicles, office buildings, and connecting new customers and electrical load, along with the expense associated with rebuilding after a damaging storm, like a hurricane or a blizzard. The rate increase will ensure continued financial stability for your cooperative while also maintaining safe and reliable service to our members.
The last adjustment made to SMECO’s distribution rates was in December 2017, which resulted in a decrease to our members’ distribution rates.
Impact to Residential Members
New distribution rates for residential and lighting customers go into effect on bills rendered on or after May 15, 2023.
The residential Distribution Charge will increase less than half a cent per kilowatt-hour (kWh) to 4.704 cents per kWh ($0.04704 per kWh), resulting in a monthly increase of approximately $4.85 for a residential member who uses around 1,200 kWh per month, though figures will vary depending on individual usage.
Your monthly residential electric bill consists of two main parts: an energy charge and a distribution service charge. The distribution rate adjustment does not impact SMECO’s energy charge, which makes up about 50 to 60 percent of the monthly bill for an average residential customer. The energy charge is a pass-through cost; SMECO doesn’t mark it up or make any money off the energy charges.
Impact to Commercial Members
New distribution rates for all other rate classes go into effect on bills rendered on or after Thursday, June 1, 2023. You can find your new rate class listed at the top of page two of your SMECO bill after June 1, 2023.
New rate structure
The final order also authorizes SMECO to transition from two General Service rate classes to four. This transition will allow the cooperative to group commercial customers with other businesses that are similar in size and usage, and allow for more precise pricing, while also providing our commercial members with rates that are consistent and predictable.
The new General Service rate classes include:
- Small Telecom High Load Factor (STHLF)
- General Service Small (GSS)
- General Service Medium (GSM)
- General Service Large (GSL)
| Rate Class | Description | Peak Demand | Charges |
|---|---|---|---|
| STHLF | Service at a single point of connection to commercial telecommunication customer. | Does not exceed 2 kW more than twice a calendar year. Peak load factor is 65% or greater for at least 10 months in a calendar year. | Energy Charge? ✔
Distribution Charge? ✔ Facilities Charge? ✔ Distribution Demand Charge? ✘ |
| GSS | Service at a single point of connection to a business enterprise (other than Residential Service to a farm), institution, or organization. | <25 kW | Energy Charge? ✔
Distribution Charge? ✔ Facilities Charge? ✔ Distribution Demand Charge? ✘ |
| GSM | Service at a single point of connection to a business enterprise (other than Residential Service to a farm), institution, or organization. | ≥25 and <50 kW | Energy Charge? ✔
Distribution Charge? ✔ Facilities Charge? ✔ Distribution Demand Charge? ✔ |
| GSL | Service at a single point of connection to a business enterprise (other than Residential Service to a farm), institution, or organization. | ≥50 kW and <1,000kW | Energy Charge? ✔
Distribution Charge? ✔ Facilities Charge? ✔ Distribution Demand Charge? ✔ |
STHLF customers who were previously under General Service Demand (GSD) will have new energy charge rates if SMECO is their energy supplier.
GSS, GSM, and GSL customers previously under General Service Non-Demand (GSND), and use SMECO as their energy supplier, will also have new energy rates*.
This Demand Charge is a fixed rate charge that does not vary from month to month and recovers part of the power supply costs that are not included in SMECO’s energy charge.
*Customers receiving electric service from an alternate supplier will not be billed the SMECO SOS rates.
Power Factor Adjustment changes from average to peak
In December 2021, SMECO suspended the power factor adjustment to billed demand on monthly electric bills for members who were served under the previous GSD and Large Power LP rate classes and who also have solar generation facilities that put that member under SMECO’s Rider NM (Net Metering) to evaluate alternative power factor calculation methods.
As part of a distribution rate case, SMECO proposed a revised power factor calculation that measures power factor based on peak usage instead of an average. This revised calculation is intended to better reflect a customer’s coincident peak demand usage in determining the power factor adjustment. The adjustment will reduce the magnitude of increases in billed demand charges for net-metering customers while having minimal impact on non-net-metering customers.
SMECO’s revised power factor calculation was also approved by the PSC on May 15, 2023 and will impact GSS, GSM, and GSL accounts, as well as the Large Power and Transmission rate classes beginning with bills rendered on or after June 1, 2023.
Power factor adjustments to the billed demand on monthly electric bills for the accounts whose adjustments were frozen will resume effective June 1, 2023. The resumption of power factor adjustments will only affect bills going forward. There will be no changes to historic bills and no refunds of any historic billing will occur.
Bill Stabilization Adjustment
In June 2021, SMECO froze the General Service Demand Bill Stabilization Adjustment (BSA) to determine more precise BSA factors for billing General Service commercial members. The BSA helps ensure that SMECO revenues to cover fixed costs will not be adversely affected by abnormal weather or energy usage. This adjustment is either a charge or a credit, depending on whether revenues fall short or exceed an average monthly level. SMECO included the BSA factors in the distribution filing and will be put back into effect as of June 1, 2023.
Revised Rates
Residential (R)
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.047 |
General Service Commercial Classes
Small Telecom High Load Factor (STHLF)
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.03176 |
| Facilities Charge — Single Phase | 18.28 |
| Facilities Charge — Three Phase | 26.15 |
| Franchise Taxes | 0.00062 |
General Service Small (GSS) Secondary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.03669 |
| Facilities Charge — Single Phase | 18.28 |
| Facilities Charge — Three Phase | 26.15 |
General Service Small (GSS) Primary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.03501 |
| Facilities Charge | 51.12 |
| Franchise Taxes — All | 0.00062 |
General Service Medium (GSM) Secondary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.03120 |
| Facilities Charge — Single Phase | 18.28 |
| Facilities Charge — Three Phase | 26.15 |
| Distribution Demand Charge per kW | 0.96 |
General Service Medium (GSM) Primary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.02958 |
| Facilities Charge | 51.12 |
| Demand Distribution Charge per kW | 0.91 |
| Franchise Taxes — All | 0.00062 |
General Service Large (GSL) Secondary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.01452 |
| Facilities Charge — Single Phase | 18.28 |
| Facilities Charge — Three Phase | 26.15 |
| Demand Distribution Charge per kW | 5.08 |
General Service Large (GSL) Primary Voltage
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh | 0.01372 |
| Facilities Charge | 51.12 |
| Demand Distribution Charge per kW | 4.82 |
| Franchise Taxes — All | 0.00062 |
Other Commercial Rate Changes
Large Power (LP)
| Rate Component | New Rate |
|---|---|
| Distribution Charge per kWh — Three Phase | 0.01158 |
| Distribution Charge per kWh — Primary | 0.01101 |
| Demand Distribution Charge per kW — Secondary | 5.23 |
| Demand Distribution Charge per kW — Primary | 4.97 |
Naval Surface Warfare Center (T-NSWC)
| Rate Component | New Rate |
|---|---|
| Demand Charge per kW | 3.73 |
WSSC Supplemental Service (WSSC)
| Rate Component | New Rate |
|---|---|
| Distribution Charge per month | 12347.61 |
Street Lights and Area Lights Rate Changes
Street Lights (SL)
| Rate Component | New Rate |
|---|---|
| 8,000 MV OH | 8.70 |
| 8,000 MV Std Post Top | 8.70 |
| 8,000 MV Colonial Post Top | 16.83 |
| 8,000 MV Cutoff Lantern Post Top | 16.07 |
| 8,000 MV Cutoff Marine Post Top | 21.98 |
| 20,000 MV OH | 17.20 |
| 20,000 MV Multi-Purpose | 11.19 |
| 8,000 HP SV OH | 8.70 |
| 8,000 HP SV Standard Post Top | 8.70 |
| 8,000 HP SV Colonial Post Top | 16.83 |
| 8,000 HP SV Cutoff Lantern Post Top | 14.75 |
| 8,000 HP SV Cutoff Marine Post Top | 20.65 |
| 20,000 HP Sodium OH | 17.20 |
| 20,000 HP Sodium Multi-Purpose | 8.57 |
| 9,100 MH Colonial Post Top | 6.47 |
| 9,100 MH Essex Post Top | 8.16 |
| 9,100 MH Oldtown Post Top | 7.85 |
| 9,100 MH Cutoff Lantern Post Top | 13.53 |
| 9,100 MH Cutoff Marine Post Top | 17.19 |
| 12,000 MH Colonial Post Top | 3.71 |
| 12,000 MH Essex Post Top | 12.22 |
| 12,000 MH Oldtown Post Top | 10.67 |
| 12,000 MH Cutoff Lantern Post Top | 16.07 |
| 12,000 MH Cutoff Marine Post Top | 21.98 |
| 14,000 MH Colonial Post Top | 8.08 |
| 20,000 MH Colonial Post Top | 32.63 |
| 20,000 MH Colonial Post Top w/ CIAC | 5.46 |
| 5,000 LED Acorn Post Top | 4.97 |
| 5,000 LED Colonial Post Top | 4.97 |
| 11,000 LED Colonial Post Top | 4.97 |
| 12,000 LED OH | 4.97 |
| 5,000 LED OH | 4.97 |
| 3,900 LED Standard Post Top | 4.97 |
| 3,900 LED OH | 4.97 |
| Basic UG LED | 9.21 |
| Decorative UG LED | 10.41 |
| Decorative Pole | 6.6 |
| Additional Pole | 3.02 |
| Existing 16′ Pole for Post Top Lum | 0.79 |
| 16′ Laminated Wood Pole | 0.94 |
| 16′ Pole for Install after 3/1/1996 | 3.24 |
| 16′ Pole for MH Lamp Customer | 3.24 |
| Decorative Straight Fluted 16′ Pole | 9.06 |
| Decorative Brushed Al 30′ Pole | 17.69 |
| Decorative Cutoff Marine 16′ Pole | 7.49 |
| Brackets 12-18 ft. in Length | 0.69 |
| 20,000 Lumen MH (250 Watts) | 2.52 |
| All Other Lamp Fixture Types | 1.30 |
Area Lights (AL)
| Rate Component | New Rate |
|---|---|
| 8,000 MV OH | 4.97 |
| 8,000 HP SV OH | 4.97 |
| 8,000 HP SV Standard Post Top | 8.64 |
| 9,100 MH Colonial Post Top | 6.41 |
| 5,000 LED Colonial Post Top | 4.96 |
| 3,900 LED Standard Post Top | 4.96 |
| 3,900 LED OH | 4.96 |
| Additional Wood Pole | 3.00 |
| 16′ Pole for Install after 3/1/1996 | 3.21 |
| Distribution Charge | 1.30 |
SMECO’s Standard Offer Service (SOS) rate for energy is made up of an energy charge and a Power Cost Adjustment (PCA). The SOS and PCA rates were unaffected by the distribution rate change. 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.
SMECO’s PCA is in place to even out the impact of fluctuating energy prices. When SMECO’s PCA is more than five percent (up or down) of the residential energy charge for three months in a row, SMECO files for a rate adjustment with the PSC. The adjustment shifts the energy charge to absorb the overage reflected in the elevated PCA. The new rate goes into effect three months after the filing date.
SMECO’s SOS residential summer energy rate, in effect May through September, is 9.49 cents per kilowatt-hour (kWh). SMECO’s winter rates, in effect October through April, are 9.31 cents per kWh.
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 October 2022.
| Dec-20 | 39.7 |
| Jan-21 | 36 |
| Feb-21 | 34.9 |
| Mar-21 | 49 |
| Apr-21 | 56.1 |
| May-21 | 63.1 |
| Jun-21 | 74 |
| Jul-21 | 77.5 |
| Aug-21 | 76.6 |
| Sep-21 | 69.5 |
| Oct-21 | 62.7 |
| Nov-21 | 44.9 |
| Dec-21 | 45.2 |
| Jan-22 | 32 |
| Feb-22 | 40.2 |
| Mar-22 | 47.8 |
| Apr-22 | 54.2 |
| May-22 | 64.3 |
| Jun-22 | 73.2 |
| Jul-22 | 77.4 |
| Aug-22 | 76.1 |
| Sep-22 | 69.3 |
| Oct-22 | 54.7 |
Control your cooling costs:
- Have your cooling system serviced annually.
- Insulate your attic, walls, and crawlspace.
- Ensure duct work is sealed and insulated.
- Find the coolest comfortable setting. (We recommend 78 degrees F in summer.)
- Install a smart thermostat. You can purchase one from our online store.
- Clean or replace filters monthly.
- Use ceiling fans and portable fans to circulate air in your home.
- Keep window blinds and curtains closed during the day to block sunlight.
- Sign up for a Home Energy Improvement Program analysis of your home.
- Use a timer for your pool pump so it doesn’t run 24 hours a day.
- Cooking outdoors will keep your home cool and save electricity.
- Turn off lights in unoccupied rooms.
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.