Covington Electric’s new rate structure will provide continued stability

The way electricity is produced and consumed has evolved drastically, and more changes are on the horizon. To combat these changes, Covington Electric Cooperative is adjusting its rate structure in order to remain financially secure and continue bringing you the service you have come to expect.

CEC depends heavily on the sale of electricity to generate operating revenue. Currently, about 60 cents of every dollar CEC receives is used to purchase electricity, while the remaining 40 cents pays for staff, poles, lines, trucks and facilities that we need to provide our members with reliable, affordable electricity.

Today’s world is becoming more energy efficient, and people are using less electricity than ever before. Across the nation, cooperatives are moving to a cost-based rate structure to combat these changes. CEC is no different.

A cost-based rate structure separates many of our fixed costs from the purchase of electricity itself. Instead of relying on members to purchase a certain amount of electricity to cover costs, CEC will increase its Access Fee to ensure our expenses are covered regardless of how many kilowatt-hours members use. This will allow CEC to decrease the kilowatt-hour charge members pay for the electricity they use.

The changes

Beginning in September, CEC will increase its Access Fee from $33.55 to $47.92 a month, which will help cover many of the costs associated with providing reliable electricity to homes and businesses.

The kilowatt-hour (kWh) charge, which is based on how much electricity a member uses, will decrease from $.11298 to $.09999 per kWh of electricity used.

How will this affect my bill?

For most of our members, these changes will have little impact on the overall electric bill. How this affects a member’s bill will depend on how much energy they use. Generally, those who use more electricity will see their bills go down, while those who use very little electricity may see a slight increase.

Electricity is an essential component to life for our members, and we can only continue providing that service if CEC remains financially strong and stable in the face of government regulations, volatile markets and the continued growth of renewable energy. By moving further toward cost-based rates instead of energy-dependent rates, we are able to fulfill our commitment to build on the past while preparing for our future.