I Told You Not to Get Distracted by Shiny Pants!
A few months ago (well, actually back on April 4th of this year), I wrote a blog post about ComEd’s new electricity rates for the supply portion of your electricity bill. At that time, there were still several pieces up in air regarding exactly what was going to happen to ComEd’s electricity rate for supply in June and July. Well, it’s now July, and we know exactly what has happened. So, let’s see how well I did looking into my crystal ball.
Here are the three tenets from the argument I put forth in April in “The Emperor’s (ComEd’s) New Rates” (https://power2switch.com/blog/the-emperors-comeds-new-rates/):
- “The new Electricity Supply Charge from ComEd is 4.597 c/kWh for Summer (compared to 6.080 c/kWh)”
- “The current Transmission Services Charge is 0.811c/kWh. And, between now and June, ComEd will also be filing an update to their Transmission Services Charge. This rate is expected to increase with the next ComEd filing. The new Price-To-Compare for June from the ICC’s Plug-In-Illinois even takes into account a higher 0.95c/kWh Transmission Services Charge.”
- “the state ICC Price-To-Compare for June 2013 is 5.547c/kWh, but I’d bet that you’ll be paying closer to 6c/kWh by the time you factor in the Purchased Electricity Adjustment charge”
So, I totally nailed the Electric Supply Charge. Granted, it wasn’t very difficult since the new rate was already published. Good for me, I copied existing information without making a mistake! So:
Forecasted Electricity Supply Charge = 4.597 c/kWh
Actual Electricity Supply Charge = 4.597 c/kWh
Difference = +/- 0 c/kWh
The Transmission Services Charge was a slightly different story. The value wasn’t quite nailed down when I wrote the article, but there were indications that the rate itself was going to go up. I had envisioned a slightly higher increase than we experienced, but I wasn’t too far off. So:
Forecasted Transmission Services Charge = 0.950 c/kWh
Actual Transmission Services Charge = 0.914 c/kWh
Difference = – 0.036 c/kWh
The Purchased Electricity Adjustment is where I really went out on a limb. No one was talking about it at the time, and there had been no indications as to what was going to happen with that charge. But, I stated that even with the lower Electricity Supply Charge, the increased Transmission Services Charge, and the Purchased Electricity Adjustment, you’d be paying close to 6 c/kWh. So:
Forecasted supply services rate from ComEd = 6 c/kWh
Actual supply services rate from ComEd (July) = 5.832 c/kWh
Difference = – 0.168 c/kWh
From when I wrote the original blog post 3 months ago, I missed calling the ComEd rate dead on by less than 3%! (Somebody remind me to buy a lottery ticket for 4 months from now.) I think that deserves a –
I TOLD YOU SO!
(But, I don’t want to get high and mighty on this. There’s plenty of stuff that I’ve gotten wrong over the last 3 months, so let’s just call it a wash.)
So What Happens Next?
Well, I’m not seeing the Purchase Electricity Adjustment changing much in magnitude in any of the months going forward. The same market dynamics are still at play, which ComEd still being a net seller of electricity on the wholesale market, and still being saddled with the higher priced electricity contracts of one and two years ago. Granted, a couple municipalities, North Aurora and Fox River Grove, returning to ComEd supply was a surprise (https://power2switch.com/blog/is-a-long-term-comed-contract-the-new-municipal-aggregation-jail-sentence/), but I don’t think that volume of customers are going to fully counteract the market forces that are going to keep the Purchased Electricity Adjustment significantly positive in the near future. The Purchased Electricity Adjustment has a cap of +0.50 c/kWh on a monthly basis, so even though +0.321 c/kWh doesn’t seem like a ton, it’s actually fairly significant. And, the return of North Aurora and Fox River Grove to ComEd supply are probably the only thing that kept the Purchased Electricity Adjustment from hitting its cap.
I’m guessing the Purchased Electricity Adjustment for August (which is actually based on what happens in July) to be able the same as it is now. ComEd will have to sell an increasing amount of electricity as more and more residential and small business customers discover and switch to retail electricity suppliers (by entering their zip code at www.Power2Switch.com and comparing rates, and via other means). (Sorry, that was an absolutely shameless plug, but having wonderful you customer use our site to choose a new electricity supplier is what allows us to bring you great interesting passable content like this.) But, I expect wholesale rates to be higher this month and next due to the warmer weather and the constraints on the transmission grid, so ComEd shouldn’t take as much of a loss as it did last month on the sale of electricity. Overall, I think these factors will roughly offset and we’ll be sitting at about the same point next month as we are this month.
The High Voltage / Low Current Wrap-up
I was right! (Sorry. It doesn’t happen too often, so I got to make sure I celebrate when it does.)
ComEd electricity supply price (when including the Purchased Electricity Adjustment) will be at 5.832 c/kWh for the month of July. I expect the price to remain very close to that for the month of August as well. (I’ll let you know as soon as I do if it’s going to be much different.)
Power2Switch is working on a way to show you the price you’re actually paying to ComEd for electricity supply, including the Purchased Electricity Adjustment. We want you get the whole picture, and not just a part of it. And, we want you to be able to see just how volatile ComEd’s electricity supply rates have been over the last 12 months due to that Purchased Electricity Adjustment.
With the best information, you can make the best choice. Power2Switch provides you with the best information about electricity.