REC Responds to CDN Readers on Rates and Scholarhips

Over the past several weeks CDN readers have expressed their opinions on a range of topics related to Rappahannock Electric Cooperative’s electric service rates as well as REC’s policies related to financing educational scholarships throughout its service area.

CDN asked REC to respond to both issues. REC Director of Government and Community Relations Matt Faulconer’s response is provided below:

Electric Rates


The only rate change since Rappahannock (REC) began serving former Allegheny Power (AP) customers occurred on July 1, when the Levelized Purchased Power Factor (LPPF) increased less than 2/10 of a cent, changing from 2.706 ¢ to 2.877 ¢. That amounts to an increase of $1.71 per month for someone using 1000 kWh, or about 1.8% of the total bill. That change was sought by AP prior to the acquisition as part of a 3-year agreement AP entered into with the State Corporation Commission in 2008. As a result of that agreement, AP was allowed to include the LPPF as a new charge starting in July of 2008. For AP’s residential customers, the LPPF increased in July of 2009 and again this past July. The LPPF is intended to recover some, but not all, of the costs of acquiring power from the wholesale market.

Former AP customers, like electricity users throughout the Mid-Atlantic region, have seen higher than normal electric bills over the past eight months due to increased use of electricity, not due to increased rates. The summer of 2010 was hotter than normal and this winter has been colder than normal. With heating and cooling being the largest uses of electricity in the average home, these weather patterns have resulted in more electricity being used than normal.

For example, on a statewide basis, January 2011 was 30% colder than normal, and colder than January of the past two years. December and November of 2010 were also colder than normal, December by 40% and November by 20%. (These statistics relate to the number of Heating Degree Days as determined by National Oceanic and Atmospheric Administration. Heating degree days is a recognized standard that measures the amount of time the temperature was below 65 degrees.) The chart below, using statewide average monthly temperatures, also shows that last summer was hotter than normal and this winter has been colder than normal.

Virginia Average Monthly Temperature

To find information specific to your area, visit  http://www.weather.gov/climate/index.php?wfo=lwx and select data from Dulles. Please refer to the attached document for summary commentary from the National Weather Service regarding observations at Dulles since last June. (I apologize for it being in all caps – I copied directly from NOAA documents.)

Dulles Weather Comments

While most of us immediately look at the amount of the bill, it is also important to look at how much electricity was used during the billing period. For example, in December of 2010, the average REC member used 2175 kWh, compared to 1890 kWh in December 2009 (which was also colder than normal) and 1698 kWh in December 2008. The same is true for the summer months. In July 2010 the average was 1615 kWh compared to 1277 for July of 2009. Obviously, the bill for these months are going to be higher than expected, but by looking at the usage the increases are more easily understood. To help with such comparisons, thirteen months of usage information is included on every REC bill (the current month and the previous 12, or for those billed bi-monthly, the current billing period and the previous 6 periods.)

To account for differences in meter reading dates, estimated meter readings, and varying lengths of billing periods, it is helpful to compare total usage over multiple billing periods. Dividing the usage into kWh used per day provides an easy and useful comparison.

Education Scholarships

Aside from being a good corporate citizen, REC adheres to the widely recognized Seven Principles of Cooperatives. The fifth and seventh of those principles are:

Education, Training, and Information

Cooperatives provide education and training for their members, elected representatives, managers, and employees so they can contribute effectively to the development of their cooperatives.

Concern for Community
While focusing on member needs, cooperatives work for the sustainable development of their communities.

Awarding scholarships is just one of the many ways REC supports education and demonstrates concern for the communities we serve. We routinely visit schools and civic groups to provide education and training on energy efficiency and conservation, electrical safety, and critical subjects like science, math, and civics. REC strongly believes that an educating and informing our members is an essential responsibility that will allow our members to better manage their energy use, make informed decisions about future energy supplies, and provide for the safety of themselves, their families, and their communities.

Specific to the scholarships, REC is awarding fifteen $1000 scholarships for a total cost of $15,000. To put that in perspective, $15,000 amounts to less than 10 ¢ per meter per year – less than a penny per month (15,000/150,000 meters). That is the beauty of cooperation: by combining the efforts of many, a large task becomes easier and the benefit is greater than the sum of the individual efforts.

I hope these explanations help address the concerns of your readers. We are glad to discuss concerns like these and encourage you and our members to forward their questions to us.

Mr. Matt Faulconer can be contacted at mattf@myrec.coop

Comments

  1. I don’t care what he says. My bill jumped significantly and I look at the usage graph on the bill to see if there is a large difference. There wasn’t/isn’t and yet my bill is a lot higher. [redacted]

  2. I’m more concerned with their billing practices. I was a ‘new’ customer in June, and although I had Allegheny accounts in my name from 1997 through 2008, due to not having an account with Allegheny in 2009, I had to pay a $500 dollar deposit to REC. This amount will be credited to my account after 12 consecutive timely payments. Considering REC bills me every other month – this will take TWO YEARS.

    REC bills me every other month, I pay my supposed ‘ACTUAL’ bill, although every bill I have ever received from them states “ESTIMATE”. This past December 11th, REC estimated my bill at a measly $150 bucks (for two months worth of service in a townhouse with electric heat). I thought they had overestimated some previous month, making my December bill pretty low. On December 27th – I received an ‘oops we made a mistake’ bill for $361.00, due just nine days from the 27th date. I had to make numerous calls to REC to try and figure out what in the world was going on.
    Since their operation claims to read my meter at every billing, but their bills don’t ever read that way – I tried to work around that by going on the budget plan – but REC based their rate on square footage (although there are numerous town houses they service – why not use an average from these residences?) and it was $260 bucks a month! FOR A TOWNHOUSE – TWO LEVEL. Crazy.

    REC – Spare me the magazine (goes directly to recycling) and spare me your scholarships (read tax deductions). Put that money toward saving your customers money.

    Better yet, how about some options? Like another service provider. Nothing like competition to drive down rates and cut the bs.

  3. My 2 Cents... says:

    This is a complete [redacted] story from the PR Dept. of REC! I have never been so unhappy with a service in my life….. They are robbing people, plain and simple. You cannot work the weather gimmick any longer. I keep my thermostat’s monitored all year long. We the people need to make noise and drive this mafia-like mindset of a business out of our community!

  4. No change in rates? Let’s just call it accounting mumbo-jumbo then. It certainly isn’t the weather. I don’t run my air conditioner in December yet my bill was $237, which for me was typically what I would see in the summer and my monthly payment under the budget plan went from $89 to $118 when REC took over. I have gas heat and gas hot water. Most of my bulbs are now fluorescent which means if anything, my useage should have decreased. Every neighbor I have talked to has seen a increase as well. I agree with others, skip the four-color, high-res magazine, set up a voluntary fund if you want for scholarships and charities and let your “member/owners” as you call us decide on all future adjustments. I don’t recall Alleghany Power spiking the rates like this and I was a 20 year customer to them.

  5. How about an electric bill of $745 dollars for 2 months! WOW!

  6. I thought the reason for the meter was to get an EXACT reading? I pay with a check with an EXACT amount. How about billing me with the EXACT amount of usage?
    Now if you want to ESTIMATE, I can do the same with my checks.

  7. REC customer says:

    I agree with the other comments. My usage has not significantly increased, yet my bills are much higher. We have gas heat, and our latest electric bill was $240 for 2 months! Previous Alleghany winter bills averaged around $75 and never over $100. I don’t believe this response at all.

  8. I’ll pile on calling [redacted] as well. Gas heat, gas stove, gas hot water and yet my winter electric bill has nearly doubled from last year. Wonder if REC will come back on here and give a real explaination or just continure to blow smoke [redacted]

  9. We live in the town and have not seen such exorbitant increases. We do have gas heat and hot water. Just to be sure I wasn’t missing something I went back through old records. What I found is my December bills have gone up about $20 or so per year with Allegheny and now the same increase with REC, but nothing like I am reading above.
    December 2006 Allegheny: 96.00
    December 2007 Allegheny: 122.65
    December 2008/Jan 2009 Still Allegheny? 146.82
    December 2010 REC 167.24
    So, while it has increased, it is no different from prior years with Allegheny. I am NOT saying this isn’t happening to others. I just wonder why our experience is different?

  10. The local Winchester TV station has people on their web site from all over the region complaining about the same thing happening to them. As well as spotty service and power surges.

  11. River Watcher says:

    I love it when we have each others back, GO CC residents!

    I wont get into what a power surge did in my home or the tree that was on the power lines this last snowstorm for 8 days partially in the road. I lost count how many times power has gone off since June. Or the fact the residents out here were never informed that AP sold us out, that’s whole other argument.

    REC said they would be trimming trees to prevent any unnecessary power outages. When?
    I think they missed a few out here…miles worth!

    As for the magazine, funny it was brought up, it was the main topic this past weekend at a local establishment. Every one agreed it was a waste of money.

    The temp chart isn’t actual temps, its averages based off of past temps. As I recall last winter was a lot colder, lower teens for weeks.

    So they blamed weather and residents, my thought is how do we get them back. By cutting our power usage back even more.
    I’ll be back with a list of helpful hints on how to cut back, if anyone is interested.

    Last July was my highest bill “outrageous” every time the power went out which was a lot my A/C had to work harder to get back down to the 74 I keep it on. Each and every time my home temp. went up 10 to 25 degrees. Don’t try to ever explain this to REC you will blow your top! Don’t pay your bill and see how understanding they are. Not!

    My bills haven’t been crazy like your all saying, last 2 months it was $200.
    Something is very wrong here, others are saying the same thing through out this County. Nobody should be paying estimated bills, its just not right. Of course the estimate is in their favor, I believe your all owed with interest.

    Its time to fight back and be heard..

  12. River Watcher says:

    Gadgets like a cell phone charger or microwave suck energy and generate heat, as long as they’re attached to a power source. Standby power for appliances not in use typically accounts for 5% to 10% of residential electricity use, according to the Lawrence Berkeley National Laboratory. Plug those devices into a power strip that can be turned off when not in use.

    Go through your home and unplug everything that is not inconstant use. All small kitchen appliances the microwave, toaster, coffeemaker ect.
    Lamps, stereos, TV’s hairdryer laptop it all sounds like a pain but you will get use to it and it will become habit. Charge cell phones in the car.
    Lower the temp in your refrigerator by one digit. The landlines phones get rid of all those charges mine came with 3 I use 2 phones and rotate them on the base charger. Run the dishwasher and do laundry during off peak rates 7pm-7am.
    I guarantee this will save you $15-$25 a month.

  13. I do not see anything on their site about off-peak rates for residents. The only thing I see is what appears to be for businesses and that is from 10 pm – 7 am.
    I did find a second rate schedule that is suppose to be for former Allegany Customers, but that is not the rate we are getting. Maybe their website is wrong?
    http://www.myrec.coop/shared/account/rates-for-new-territory.cfm

  14. River Watcher says:

    Here’s REC policies on off peak hours. Have a nice day!

    On-peak hours shall be the same as those specified in the Rate Schedule under which the Cooperative purchases power and energy from its principle wholesale power supplier, currently 7:00 a.m. to 10:00 p.m., Mondays through Fridays for the months of October through May, and the hours between 10:00 a.m. and 10:00 p.m., Mondays through Fridays, for the months of June through September. All other hours shall be considered off-peak hours.

    http://www.myrec.coop/content-documents/ScheduleLP-1-Nv09.pdf

    • That is for large power service – we are schedule A
      http://www.myrec.coop/content-documents/ScheduleA-Nv09.pdf which mentions nothing about off-peak hours.

      • River Watcher says:

        Thanks for catching that, I should have really looked it over. I assumed all power suppliers have off peak rates for residential use only because that’s what I’m use to.

        Every ‘how to” save on electricity website mentions off peak rates.
        I researched many power suppliers in this area and up north, they all offer off peak rates for residential use.

        Apparently REC is about the only power supplier that does not offer this to their residential customers. Id like to know Why?
        Id like to hear REC explain this one..

  15. BlossomButt says:

    Their explanation of the seasonal temperatures is plain [redacted]. My usage has not been extremely high, it actually has been about the same. We have a week or two of extremely cold/hot weather, then back to norm, so these average out over time, just like before. The main reason they are using “estimates” is because we citizens would have proof of the theft they are doing if we were to see that our actual usage was the same, yet our bills go through the roofs. I dont buy a bit of what they say and I never will. Its nothing but a monopoly and I think we as a group need to stand up and fight it, look for alternatives, they are out there, and tell them we have had enough!

  16. Keep posting folks. I sent the link to htis story to Jill Vogel’s office. We’ll see if it does any good

    • River Watcher says:

      Hey Sarge,

      It would take 2 entire pages to fill everyone in on whats been going on out here with REC.
      Perhaps us locals could all gather together and have a meeting about our power supplier without REC being part of it. So that people could talk without being interrupted with corporate lingo and excuses. Its just an idea lets kick it around and see what you all think about this. Maybe we could all figure out whats going on with comparing bills and stories.
      I know what I have to say just might shed some light on this situation.

    • isn’t she in the oil/energy business? What does she care? That’s like telling Bush that the price of gas is too high.

  17. Allan "Bugs" McWilliams says:

    Any one ready to take on the oil Companies over the price Of heating oil?

    • Thats a scam too! I guess since Egypt is in disarray, they will blame the current spike in gas/oil on this. This is another problem in this country. Talking about a mafia/monopoly? The whole gas/oil industry is one big gimmick designed to keep the investors and owners constant BILLIONAIRES!!!!!!!!!!!!!!!!!!!!!!

      Karma is a [redacted] !!!!!!!!!!!!!!!!!!!

  18. Just looked at my bill online for this billing period – $471.00! This is for a two bedroom, two level townhome with central air electric heat. I feel like something is really wrong here, we are a very energy conscious family.

    I’m just waiting to get my paper bill to see if the reading method is actual or estimate. My guess, it’s going to be an estimate and when I call RED they’ll say it was an actual reading.