What Price Electricity — Really?

What Price Electricity — Really?

Most people have no idea how much their electricity costs per kilowatt-hour.  They know about what they pay per month, but not what they pay per unit.  There’s a good reason for that—it’s the most complicated pricing for any product on the planet.  But it’s important to understand these complications if you want to sell someone on the idea of saving on their utility bill.  You can learn how to figure out utility prices by attending a 3-hour course offered by SARTA’s Leadership Series on September 28.

To persuade a potential client that your clean tech product (like solar, wind, or efficiency) is a smart purchase for them, you need to be able to tell them why – which means, how much they will save. On the other hand, if you’re an electricity customer who wants to lower your bill, you need to know when and how to do that the best.  In both cases, it’s all about figuring out the prices. You can’t just look at the utility bill and figure this out—not without knowing a lot more about how the pricing formulas work.  Sometimes electricity costs 45 cents per kilowatt-hour, sometimes it costs 9 cents, sometimes it costs 70 cents, sometimes you can avoid only a part of charges for electricity, and sometimes you can avoid them all.  The bill doesn’t help much in understanding this.  It just adds together all the levels of pricing and shows you the total.  And the explanations the utilities publish, while they are very accurate, are hard to follow—unless you get some help.

The prices for electricity became complicated when utilities tried (or were ordered) to publish a fair estimate of what it actually cost to make electricity. In reality, the costs for making electricity were always complicated.  Utilities previously made it simple by charging customers pretty uniform average prices.  But that hid the fact that the underlying costs vary depending on (for example) time of day, season, level of total demand, prices of the fuel used to make electricity, and level of hydroelectric reservoirs, among many other factors.  In order to encourage people to make good choices (buying power from the utility when it is cheap, or reducing usage when it is expensive), utilities needed to make the prices match the real complexity of what it cost to make the power and deliver it—and make that price clear.  Unfortunately, prices that are complex are rarely clear.

At its September 28 Leadership Series seminar, SARTA will host rate experts from three utilities who will reveal their secrets of electricity pricing.  At this seminar you will learn about multi-part rates, time of use rates, peak load rates, incentive rates, buyback rates, and more.  You will also learn how to keep on top of the most current prices, understand when they change and be alert to new features that can help or hurt your business.  Nowhere else are you going to be able to learn all of these things in such a short course, that is specific to the three utilities serving the Sacramento region.  If you are trying to sell clean tech products that replace utility power—or just if you want to learn how to choose rates that can help you lower your bill— join us at this seminar.  Sign up soon, though, it’s filling up fast.

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