- The Enterprise
- The Recorder
The Southern Maryland Electric Cooperative has filed a request with the state’s energy regulator to reduce its electricity rates for residential customers beginning in August.
The co-op has asked to reduce its summer rate by 2.5 percent from 8.83 cents per kilowatt-hour to 8.61 cents and its winter rate 3.9 percent from 9.62 cents per kwh to 9.25 cents.
SMECO submitted its application May 30 with the Maryland Public Service Commission, which must approve the reduced charges. If approved, the reduced charges will first appear on customers’ August energy bills.
If the commission signs off on the rate decreases, a typical monthly consumer bill of 1,300 kwh will go down by $4, according to a SMECO news release.
Each month, co-op customers are charged the base energy rate plus a “power cost adjustment,” which alters their payments when the rate varies from the actual costs of providing power.
SMECO must apply to change its energy rates anytime they differ by more than 5 percent with those actual costs.
The proposed rates are a result of decreased capacity costs, which fund existing power plants and pay for expansions to plants and transmission facilities. Utilities and energy supplies in the mid-Atlantic region are required to pay capacity costs, which will decrease by more than $13 million during the 12-month period beginning in August, the release states.
“We are pleased to pass along savings of nearly $50 a year to our customer-members,” SMECO President and CEO Austin J. Slater Jr. said in the release. “The co-op does not make a profit on energy charges. We work to keep our rates as low as possible by using a portfolio approach to purchasing power, with contracts for base load and peak load and long-term and short-term contracts. This method of purchasing power produces stable energy rates and helps save money for customer-members overall.”
The co-op also asked to change when its summer and winter rates are charged. Traditionally, SMECO has classified June through October as summer months and November through May as winter months.
Due to shifts in customer use patterns, the co-op has proposed changing its summer rate months to May through September and winter rate months to October through April, according to the release.