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Seen on reddit and other sources:
https://old.reddit.com/r/fresno/comments/1hxqlx7/the_more_i_try_to_save_energy_the_higher_the/
Its already 50c or more per kilowatt hour... https://www.pge.com/assets/pge/docs/account/rate-plans/residential-electric-rate-plan-pricing.pdf
On top of the "The Electric Home Rate Plan includes a $15-per-month Base Services Charge"... because people were starting to get 100% of their power from solar and it was "unfair".
Electrical service should have a fixed connection fee.
The reason this happens is because electrical companies have two different kind of costs:
Those related to obtaining the electrical power from generation companies.
Those related to maintaining the grid and providing a connection.
In the past, normally what they did was to simply reduce this to a single price, and for that to be per unit of electricity used. That is, the consumer pays $N. That was at least not an entirely unreasonable approximation when people were pulling electricity off the grid.
The thing is, if a user mostly generates power locally, they still want to have that electrical connection and providing that connection still costs money. But now they're also not paying for their share of the grid connectivity -- it's getting offloaded to the people who aren't generating electricity locally.
Hence, the split that many utility companies are shifting to. There's a fixed charge to have a connection to the grid, which covers the cost of grid maintenance. And there's a separate cost per kWh of energy used.
If someone doesn't care about the grid connection -- like, they're confident that they can handle their power needs locally, don't care about having a grid connection, they do have the option to just drop service. But most people want to have the access to draw more power if they aren't generating enough, so they want to retain their grid connection. With the grid connection fee being broken out, they cover their share of the costs.
Now, I've no disagreement that California electricity rates are pretty bonkers. They're some of the highest in the US:
https://www.electricchoice.com/electricity-prices-by-state/
But the issue isn't having a separate grid connection fee from an electricity used fee.
At least in Illinois, there is no option to go off grid. You're legally required to maintain a grid connection even if you are generating all power locally.
This is roughly what we have in the UK.
For electricity, the standing charge is 61.6p/day, then 23.3p/kWh.
And gas is 29.6p/day, then 6.1p/kWh. (The numbers vary, and you can choose to lock rates for the duration of a contract).
There has been some discussion of it in recent years (after it doubled, thanks Putin).
Whether it is fair for people using less energy...But in reality, everyone has similar 100 or 60A connections to the grid.
There are tarrifs for very low users, where the standing charge is combined with the first kWh.
Once I'm off the gas boiler, and on a heat pump, I may get my gas disconnected to save the standing charge.
On a tangent, as you may be interested, we now have the option of flexible electricity pricing that tracks the wholesale rates for the day. Usually, it's cheaper, sometimes even negative. Link.
However, this week there has been a lot of expensive energy, so it's been butting up against the £1/kWh limit!
70с/kWh is insane lolol
The way we do it in New York city is that the power bill has two columns. Delivery charges to pay for the lines and maintenance, and supply charges for the power generation. Both are per kW, like 3cents delivery plus 15cents supply. Plus a couple of fees and sales tax.
You do have to be careful here, because some localities actually require a grid connection to maintain a certificate of occupancy. Title 24 changed in recent years (here in CA), but you may still end up fighting your municipality and the POCO.
There's certainly some reasonability to that. However, if the person decides to terminate service, maintaining the grid doesn't become any cheaper for the power company. The lines are already installed, the connections made, and the company will continue to upkeep your connection all the way up to your home, even if it is terminated locally. They'll do that just in case you or future homeowners no longer generate power and wish to continue service, and your neighbors will likely still be using it anyway. So by that same reasoning, maintaining a just-in-case service connection that you don't typically need because you generate your own power also doesn't result in increased maintenance costs to the power company. So there is also an argument to be made that that cost shouldn't be pushed to them, but to the power drawers that the power company actually wants to serve anyway, the ones motivating them to build more grid in the first place.
Well, I suppose they could just take out the stretch of power line between me and my neighbors who use their service and cut down those maintenance costs altogether!
This isn't like a driveway, it's more like a road. It's used by more people than the people whose property it's in front of. And where I live, the property owner is considered to be the owner of the lines that extend from the grid to the home, so guess who already pays the maintenance costs on that?
Are you saying that someone who uses 10kWh of grid power per month should pay the same "connection fee" as someone who uses 990kWh per month?
Assuming they have the same type of connection, yeah, why wouldn't they?
Simplified scenario.
The cost for the grid provider to maintain a transformer is $1000.
A transformer can serve 20 low-use households, or 2 high-use households.
Both the low-use and the high-use households have the same, 200A service to their homes. Either can use up to 200A. In practice, neither actually does. The only difference between a low-use and a high-use household is in how much they actually use.
A neighborhood has 20 low-use households (1 transformer).
That same neighborhood as 10 high-use households (5 transformers).
This neighborhood of 30 houses has $6000 in maintenance costs.
Here are the two options we are talking about:
Fixed rate. Each household in this neighborhood pays a fixed, $200 "connection fee" to cover these costs.
Consumption-based. Each of the 20 low-use household pays $50 ($1000 total, for the 1 transformer they share) and each high-use household pays $500 ($5000 total, for the 5 transformers they share).
With Option 1, each of the low-use households is paying 4 times the maintenance costs that they actually incur, and each heavy-use household is paying only 40% of the maintenance costs they incur.
With Option 2, both low- and high-use households pay their actual maintenance costs.
Which option makes more sense?
Fixed fees only make sense for covering administrative costs, which scale per user. Grid maintenance costs scale based (primarily) on total consumption. Fixing maintenance fees forces low-use households to subsidize high-use households.
I feel like I'm in the fucking twilight zone here. The community does not seem to comprehend what they are demanding.
No, they're arguing that the price of power should be split:
This makes sense, because regardless of you much power someone uses, the costs associated with maintaining the infrastructure that allows them to draw any power at all remain the same. This also happens to be the model used in Norway, so it's not an untested concept.
Another option, relevant when the cost of building the power plant is large and the cost of energy production is negligible, is that everyone connected to the grid pays a near-flat fee in total, which is distributed among consumers depending on how much power they use. I've never heard of that option being used before.
Assuming both of those people use exactly the same infrastructure (which they do), yes.
The person with the higher usage will still pay more in total because the connection fee is just a base price, you're still paying per kWh (which is forwarded to the companies running the power stations)
Ok, so, you're in a neighborhood. You and 100 neighbors are each using 10kWh. 1000kWh total.
Now a heavy industrial user comes in adjacent to your neighborhood. They are going to need 990,000kWh. The distribution infrastructure is going to need to be upgraded to meet the new need. It is going to need to be upgrade a lot. Those upgrades are going to be extraordinarily expensive to meet the extraordinary needs of that new user.
Should you and your 100 neighbors each have their recurring connection fee jacked up next month and that charge made equal to the 101st "neighbor"?
Of course not. That's just absurd.
The whole "local generation" issue you were raising is a red herring.
Wow. Talk about moving the goal posts. You're not even taking about the same thing anymore.
If you just wanna bitch about something, uh, then go in with your bad self. Or something. But rather than even attempt a rebuttal to any of the points raised in this thread, you've literally completely changed the scenario being discussed.
Like, why even bother replying? Your whole tirade doesn't even make sense in the context of the thread...
I love when folks introduce hypotheticals, then pile on hypotheticals and nonsensicals, and believe they've championed their cleverness.
I propose a new term: feather man. For when even a straw man looks like a steel man compared to your argument.
B-B-But what if you fell into a volcano before you could make that proposal?
What then, featherman?
Checkmate!
I used exaggerated examples to clearly demonstrate the nature of the problem, not to quantify it.
The problem is still present even within the neighborhood. Residential consumers rarely draw more than 1/10th of their rated service. Crypto-bro comes into the neighborhood and his miners continuously max out his service.
The power company normally installs and maintains a single service transformer per block; but he alone uses as much power as the rest of the block combined. They have to install and maintain a second transformer just for him, but they spread those extra costs among the entire block.
Why is it reasonable for the power company to demand you subsidize his electrical connection than for him to pay for what he is using?
The “connection fee” would probably be flat by service size. Most homes have 200A connections so that would be one flat rate for everyone with a 200A ingress. If a business uses 400A, they’d get a different price but all 400A would be the same.
Get it now? That has nothing to do with amount used, but rather the size of your “pipe”
Cryptominer maxes out the same connection that you rarely draw 1/10th of. Why are you subsidizing cryptobro?
I’m not. They would be paying for their usage, I would be paying for my usage. Hence the flat fee for connection plus the cost of usage. It works the same way with sewer and gas (at least where I’m at) everyone pays a flat connection fee based on max size available to you and then you pay for your usage.
My state separates generation from distribution. I literally have a hundred options for generation. I pay a generator to put power on the grid.
I only have one option for distribution. I pay that distributor to convey power (ostensibly) from my generator to my house.
The generator is not the only one with consumption-based costs. The distributor/grid provider also has costs that vary depending on how much power they are moving. They need to upgrade transformers and substations and install additional transmission lines as demand increases. Those have associated costs.
I could understand a flat fee for administrative costs: the power company does have certain per-user costs. But grid maintenance is not one of them: grid maintenance costs depend almost entirely on the total amount of power being moved, not the number of users served. Those maintenance costs are already rolled into consumption. Making them a fixed cost just forces low-use households to subsidize high-use households.
An industrial facility to the scale you are refering to will likely have its own electrical substation. Either maintained by the facility itself or contracted out to the power supplier.
Of course. I used that exaggerated example to demonstrate the nature of the problem, not to quantify it.
Cryptominers can use the same connection that you do; they just max it out 24/7, while you rarely use more than 1/10th of your connection.
Why should you be forced to subsidize your cryptoneighbor?
Connecting infrastructure costs roughly the same to maintain regardless if 10 amps or 1000 amps is running through it. The crypto miner pays the same fee for their standard service connection then pays per Kwh just like everybody else. Other customers are not subsidizing their connection nor their power.
By your logic, you are subsidizing anyone who uses more power than you and you are being subsidized by anyone using less power than you.
That's simply false. A 1000A transformer costs considerably more than a 10A transformer, both to purchase and to service.
That is only true if the "connection fee" (distribution charges) are the same for both the 10A user and the 1000A user. When the charge is divided up on the basis of a user's actual consumption, it is not.
You're making the argument yourself here:
Yes. And that is true regardless of how heavily it is used, which means you should pay a flat rate for maintenance of the infrastructure you use, and another rate for the power you draw.
Residential buildings use standardised infrastructure, which then leads to the same standard fee for everyone. Industry that needs heavier equipment pays a different fee, because they require different infrastructure.
It's not being used. The neighborhood is using the cheaper transformer, because it fully meets their needs.
They don't install the big transformer until Cryptoboy moves in and drastically increases the neighborhood's needs.
Why is the neighborhood evenly paying for that transformer upgrade? Why isn't Cryptoboy paying for this upgrade?
The transformer is dimensioned based on the max capacity of the houses in the neighbourhood, which are standardised.
100 houses with 200 A main fuse each? Supplied by a 20 000 A transformer (plus safety margin obviously).
If cryptoboy wants a non-standard main fuse size that requires an upgrade of the transformer, he has to pay for that.
No, it isn't. They use considerably smaller, cheaper transformers, based on the maximum expected load. A 500A transformer might serve ten 200A users.
Those ten users might never use more than 400A total, even though each of them might use 150A+ from time to time. It doesn't make sense to install a 2000A transformer when it will never see more than 400A.
Why are the industrial factory and normal residences using the same electrical hookup? Seems fair if they use the same hookup.
Oh, they're not? So then the factory likely pays one rate for their industrial connection that needs to pull more power than standard residential usage, and normal consumers pay a lower rate for their lower connection provided.
Exaggerated to clearly demonstrate the problem.
With residential housing, consider the cryptobro continuously drawing 180+ amps of his 200A service, while the rest of the community averages 10A, and one unit is down around 1.5A.
Why is Mr. Ampandahalf paying the same connection fee as Mr. Wunetty?
Because the connection fee is a fee for the connection, which is the same (200A) in both cases. This isn't difficult.
.... because consumption and service connectivity aren't the same? Consumption and connectivity are two different line items on the bill representing different costs associated with the service.The high consumer will pay more on the quantity used, and possibly at a higher a per unit basis if it exceeds expected values.
From your hypothetical, no one is noted as having a different service hookup, so they're paying for the same service hookup. What part of that are you struggling to grok?
E: removed unnecessary phrase
That's fine. There are certainly some per-user costs. Such as the cost of billing each user every month. A fixed administrative charge makes sense to cover those billing costs. That cost is the same whether they are sending a $10 bill or a $50,000 bill, so a flat rate charge is reasonable.
"Infrastructure maintenance" is not a per-user cost. Maintenance is performed on the shared resources: the lines between the poles. The customer pays their own electrician to install, connect, and maintain a service feed; that is not part of the maintenance that the power company performs.
A transformer does not care whether it is maxed out serving 20 users, or it is maxed out serving just 2. It costs the same to maintain either way. Call it $1000 per transformer, just to illustrate.
In a neighborhood with 20 low-use customers (equivalent to 1 transformer) and 10 high-use customers (equivalent to 5 transformers), it is ludicrous that every one of these 30 households should be paying the same $200 "maintenance fee". The 20 low-use customers incur an average of $50; the 10 high-use customers average $500.
You would charge based on the kind of connection. A house isn't going to draw the kind of power that a factory will, but you're going to need the same equipment your house as you would as your neighbor's house.
Residential crypto miners can easily draw more power than small factories. I reject the premise of your argument.
You specified energy in your example, not me. And I hinted that a hookup fee would likely be dependent on the rated power capacity of the user.
It is likely that a residential crypto miner would likely need to upgrade what they can draw from the grid.
They have 200A service, same as you. They don't need to upgrade.
The difference is that they are using 200A 24/7/365, while you probably average less than 10A, and rarely exceed 50A.
They are literally using 20 times as much power as you, and you're saying they should be paying the same fees as you.
One such cryptoboy per block and the total consumption in the region doubles. The infrastructure costs double. Your "flat fee" doubles, because it is divided evenly among the users, rather than assigned to the cryptoboys who created it.
And you're saying this is a good thing?
I feel like I've entered the fucking twilight zone here.
No one is saying you should pay the same total bill as they do, just the same connection fee if you and crypto boy have the same hookup.
You'd pay $10 for a connection fee and $1 for power while they'd pay $10 for a connection fee and $1000 for power.
Understood.
And that "$10 connection fee" makes perfect sense for covering per-user administrative costs. The cost is the same to send a $1 bill or a $1000 bill to the customer; a per-user fee to cover that administrative fee is not unreasonable.
But they aren't talking about administration. They are talking about infrastructure maintenance. Infrastructure is a shared resource, and the maintenance costs scale (primarily) with total consumption, not per-user.
From the original comment:
That "fixed cost to have a connection to the grid" does not cover grid maintenance. Grid maintenance costs are proportional to consumption, not number-of-users. It does not make sense that this fee should be divided among users rather than based on consumption.
Generally you pay a grid connection based on the type of connection you have. A giant factory has a much beefier grid connection than single family residence, so the big factory has a higher connection charge.
Is the person's connection to the grid using less energy a smaller connection, or is it the same? If they're the same, why should someone using less be charges less of a connection fee? Why would usage impact a fixed on/off fee, especially with per-unit usage rates?
You would have a point if it were possible to downgrade a connection to closely match your consumption. But that is not the case. You can't buy a 20A service when everyone in your neighborhood has 200A. It's a matter of safety: service lines need to be sized based on the upstream current limited, but the current limiter for your service (the main breaker in your panel) is downstream of that service line. If you put an undersized service line to your house and it develops a fault, it will burn up before tripping the neighborhood "breaker".
It is more reasonable to charge you for the generation and distribution of 2A than for your 2A service to be charged the same "connection fee" as your cryptobro neighbor.
You absolutely could pay for a lower rating if you chose to also pay for the equipment to step down the supply to your intake values. That what a transformer substation is for, and why the factory and residential lines can share the same upstream but get different local outputs. It's just going to be so much more expensive that you're never going to go that route unless you've got a lot of people that want to do the same.
Is that not what your consumption fee is for? You're paying for generation/distribution for the power you use, and the power company also tacks on a base fee to account for other maintenance costs that had been bundled but were being lost due to net metering.
From a collective perspective, it makes sense to pay to connect, and also pay per usage when you have the potential to have distributes generation, but centralized maintenance of the shared infrastructure.
Based on that comment, I think I understand the issue.
In my state, I can purchase power from literally any of a hundred generators. I pay them to put power on the grid, for me to take off.
I also pay a single grid provider to (ostensibly) transfer that power from where it generated to me.
What I am talking about here is the fact that both the generator and the grid operator have costs that depend on "consumption". The more power I use, the greater the load on the grid, and the more infrastructure they need. They might be able to use a single transformer to adequately serve 20 low-use households; they might need 5 transformers to adequately serve 10 high-use households.
Even though all 30 of these households have 200A service, It does not make sense that the cost of these 6 transformers should be evenly assessed. It does make sense that two high-use households (who use a full transformer) pay the same total fee as the 20 low-use households (who also use a full transformer).
The way it works here (the Netherlands) the monthly cost for the connection to the grid depends on the maximum current and number of phases.
Some examples: a 1 phase 1A connection costs €11,12 per month, 3x 25A costs €168,99 , 3x 80A is €408,94 (there are other capacities available with different rates).
To me this seems like a fair way of doing it, someone who draws more power (or higher peak power) needs a beefier hookup and that requires beefier and more expensive equipment and cables.
In Norway we pay a different fixed fee based on the maximum hourly use (average of three highest hours) during a month, so that consumers that need a lot of effect from the grid pays the most.