Midwest Energy Considering Three-Part Rate Structure | News

Midwest Energy Considering Three-Part Rate Structure

September 02, 2022

Midwest Energy is considering adoption of a three-part rate structure for residential and small commercial (General Service Small) electric rate classes. The rates consist of a customer charge, energy charge and a demand charge, and would begin Jan. 1, 2023. 

The proposed rate changes would be revenue-neutral for the cooperative, and would be phased in over a period of four years. As demand charges are introduced, energy charges would decline each year, offsetting much (in some cases, all) of the demand charge, resulting in a $0 monthly increase for an average residential customer. 

Demand charges would be a monthly charge based on “peak demand,” or the maximum number of kilowatts a customer used at a specific time. In the summer months of June 1 through September 30, demand would be billed based on peak demand between 3 p.m. to 7 p.m. The rest of the year, the billed demand would be based on whenever peak demand was reached during the month. 

A graph depicting the potential bill impacts for the average residential customer, assuming a demand of 7kW.

Note: The above graph assumes no changes in a customer's energy usage and an average demand of 7kW. Your actual demand could be higher or lower and will be affected by changes in energy use patterns.

For more information, visit www.mwenergy.com/residential/demand_rates.

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