Perspective: Planning for the Lowest Possible Cost
Most members see their highest bills during the summer. But, while they are the highest you see all year, Jackson EMC members pay some of the lowest rates in the state. To keep rates low we accurately forecast how much electricity we’ll need, build resources and contract with power suppliers to provide electricity at set low rate, develop partnerships with our members to meet demand and ultimately, manage money wisely.
Seventy-five cents of every dollar paid to Jackson EMC is used to purchase the power that flows to our members’ homes and businesses. And one of the most important things we do to ensure you pay the lowest possible price for power is plan for how that money is spent. Accurate forecasting means we anticipate how much electricity people will need, where they will need it and when. This helps us supply our members with the reliable electricity they need without overinvesting in generators and power lines.
Electricity works in a system of supply and demand. Ideally, you would sell the same amount of electricity all the time, but life doesn’t work that way. We use less electricity at night and during the spring and fall. Because usage fluctuates, we have to plan. These plans involve building generators, transmission lines and substations so we can meet demand.
Our plan includes a contract with a power supplier who purchases a portion of our electricity on the wholesale market at a guaranteed set price. So far this year, about 30 percent of our electricity has been purchased, rather than generated through our own facilities. Without this contract, we’d be susceptible to the price swings in the market due to supply and demand. We’ve seen times where the market price to purchase power is a dollar or more per kWh. That’s ten times higher than what our members are charged today.
In the electric business, we have a term called peak demand, which is the most energy we’ll ever use in an hour. Reducing peak demand saves money because we don’t have to invest in more generators, transmission lines or substations. To minimize our peak demand on some of those scorching summer days, some of our members have enrolled in a load management program. We remotely turn off air conditioners and water heaters for a few minutes at a time to cut back on electric use. We save nearly half a million dollars a year due to the load management program. The members enrolled are paid to participate, but we all benefit.
Giving our members the best possible value at the lowest possible cost is our goal. Providing you with the information and programs you need to manage your electricity use is important. If you want more information about how to manage your energy use, please see our tips in this issue or go online for a list of tips from our energy coach. (Tips are available at www.jacksonemc.com/playbook).
Reach out to your co-op president, send an email to [email protected].