Your Electric Bill
Your residential electric bill says a lot about your electricity use and its costs. There is a relationship between lifestyles, energy consumption and energy costs. Here is basic information about electric rates and how the amount due on your residential electric bill is determined.
Your electricity use is measured in kilowatt-hours. One kilowatt-hour (kWh) is equal to using a 100-watt light bulb for 10 hours. An electric meter at your house, apartment (or business) provides a precise reading of your kilowatt-hour usage over a period of time, normally a 30-day cycle. On your scheduled billing date, the number of kilowatt-hours you have used is multiplied by the not-for-profit electric rate to calculate your electric usage charge.
How are HES rates set? The cost per kilowatt-hour is based on the costs to provide service to you. At public power utilities such as ours, electric rates are not set to make a profit. Instead, rates are determined by costs to generate or purchase power, and deliver it to the community.
Fortunately, your electricity comes from a nonprofit, community-owned and locally controlled public power system. What this means is that HES does not sell electricity to make a profit for stockholders who may live outside the community. Our revenues stay local. You receive the highest level of service, because we work for “you”, not for a profit.
Our power supplier (TVA) has added a fuel cost adjustment charge to defray the cost associated with volatile coal and gas prices to produce electricity. The implementation of the FCA was mandated as of January 1, 2007 and will be adjusted quarterly based on TVA’s actual cost to produce as it is effected by fuel prices.
Many factors determine your electric bill. Your bill will list late payment charges and any prior balances. Listed separately, line by line, are any charges such as security lighting or a “connect” fee, heat pump loan. A 3% school tax is added to the total bill due, but is not part of the actual cost of providing electric service to you. HES bills and collects this tax for the public school system. A customer service charge, administrative fee associated with meter reading, billing, etc., is also built into your bill.