Understand your Power Costs
What are the cost factors that influence your power bill? Try our rate calculator to explore the trade-offs with increased or decreased service access and energy charges
We buy it from the Pacific Northwest Generating Cooperative (PNGC)
The power is generated by the Bonneville Power Administration (BPA). More than 85% of OPALCO power is generated by a clean and renewable source: hydroelectric dams on the Federal Columbia River Power System. Check out our most current fuel mix report.
Our costs go up with BPA’s costs
~99% of our energy is generated by the BPA. BPA has forecast 5-7% increases in the cost of power each year through 2028. BPA holds a rate case every two years to determine the cost of power. Why are BPA costs rising?
Consumers have two components in their OPALCO power bills: service access / facilities charge (fixed costs) and energy charge (usage measured in kWh). The 2018 rates collect about 30% of the cost to deliver power (fixed costs) in the service access charge and depends on energy usage to collect almost 70% of those costs. In this current rate structure, weather is a major factor: with warmer temperatures, usage goes down and OPALCO doesn’t collect enough revenue to cover costs.
Many OPALCO members struggle to pay their power bills. The Co-op is committed to keeping rates as affordable as possible and has two programs for those who need help paying their bills. Project PAL is a once-per-year grant during the heating season and Energy Assist is a monthly bill credit ($25 – $55/month) for qualified households.
OPALCO’s Board of Directors set the rates each year during budget review. Every 2-3 years, OPALCO conducts a Cost of Service study to ensure that all consumers are paying their fair share; that no rate payer class (residential, commercial, seasonal, interconnected renewables) subsidizes the cost to deliver power to others. OPALCO members are welcome to attend board meetings and can review board materials online.
Fixed and Capital Costs on Your Bill
Cost Before You Flip a Switch
Did you know it costs about $112/month to deliver power to your home before you ever flip a switch? OPALCO collects only about 30% of the fixed costs in the 2018 service access charge ($42). The Board is exploring how to better balance the facilities charge and energy charges on consumer bills while still keeping price signals competitive with alternative, higher-carbon fuel sources to promote fuel switching.
Each generation of consumers help pay for capital improvements through rates, which include the depreciation and interest payments on long-term, low-interest capital loans. OPALCO’s long-range plan and 4-year construction work plans spell out the capital projects required to maintain safe and reliable service to our 20 islands. Each year, the budget includes a debt and equity plan to keep the Co-op positioned to tackle these key projects and maintain financial health.
Calculate the impacts of a higher or lower service access charge: what are the trade-offs?
Move the arrow to one of the brackets on the slider to see:
- the impact to your average annual residential bill and cost per kilowatt hour
- winners and losers as the balances shifts between service access and energy charges
These are the trade-offs the Board must consider when setting rates
- Color Key
- Green: Positive Impact
- Black: Neutral Impact
- Red: Negative Impact
- Bills go up; cost per kilowatt hour at its highest
- Promotes use of higher carbon fossil fuels; clean electricity not competitive
- Consumers have more control over monthly bills by moderating energy usage
- High kWh cost encourages energy efficiency and conservation
- Year-round rate payers subsidize fixed costs for seasonal members, those who use fossil fuels and the lowest energy users
- Revenue stability for OPALCO at its lowest (weather dependent); energy charge adjustment (true up collection) potential at year end if revenue falls short
This is where the current rate structure balances energy and facilities costs.
This tool will help you explore some of the impacts that the Board must consider when setting rates.
- No matter how rates are balanced, we must collect enough revenue to meet expense.
- If the revenue is not collected in rates, members may have to pay a true-up charge at year end; if too much revenue is collected, the same energy adjustment charge could provide a rebate to members at year end.
- The goal is to collect just enough to meet the cost of service.
- Bills go down moderately
- Bill amount is more predictable; more consistent winter/summer
- Price signal encourages switching from higher carbon fossil fuels to clean electricity
- Less cost incentive for energy efficiency and conservation; greater reliance on programs (rebates, on-bill financing, etc.)
- Level playing field: most consumers pay the actual cost to deliver power
- Revenue stability for OPALCO increases; less affected by fluctuations in weather
- Bills go down; cost per kilowatt hour at its lowest
- Consumers have no control over monthly bills
- Greatest bill predictability year round
- No cost incentive for energy efficiency and conservation; must fund programs to encourage measures
- Strong price signal encourages switching from higher carbon fossil fuels to clean electricity
- Danger of reckless energy usage resulting in high demand charges and rising costs
- Seasonal members, those who use fossil fuels and the lowest energy users pay full cost to deliver power
- Revenue stability for OPALCO at its highest; weather fluctuation has no effect
The data used for this simplified tool is residential usage only and defaults to average residential usage of 1500 kWh/month. Energy users on the higher and lower extremes will see more dramatic differences in average bill amounts (enter actual usage to explore). Tool is meant to promote a high-level understanding of a very detailed and multi-faceted rate structure. For more detailed information or to meet with staff, please use the contact form below. Staff are also available to meet with groups to discuss rates.
Let us know what you think
Questions? Want to send a message to our leadership? Meet with staff?
Invite us to your group meeting? We welcome your feedback!