How much do you really pay for electricity? Understanding your Con Ed bill.

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Con Ed bills are notoriously complex. There's alot of information packed into a Con Ed bill, much of which remains obscure or uninteresting to the average consumer. But, in order to fully appreciate just what costs your solar panels will be offsetting, we must dissect your bill.

Supply and delivery: how solar actually makes you money

The power you generate from solar will not offset all of your bill; however, it will offset its two largest line items: electricity supply and delivery costs. See above.

You see "Supply" next to the number "513 kWh" followed by the rate you're paying your paying for supply. This is effectively the mark-up rate that Con Ed is charging you for electricity. Or, if you specified a specific ESCO (Energy Service Company), as this person has, then your supply rate is the rate you're paying that ESCO for generating the electricity you're consuming.

Of course, the electricity must then be transported to your home where it will light your bulbs and power your fridge; the cost of that transportation is your delivery charge. And so the total cost of electricity for mid-May to mid-June of 2021 can be calculated simply as the sum of your supply and delivery costs. For this person, it's: $81.57 + $62.98 = $144.55. This person's cost per kWh is 15.9¢ + 12.3¢ = 28.2¢ per kWh. That's higher than the average cost per kWh anywhere in the nation except Hawaii.

Now, electricity prices fluctuate, and some ESCOs charge more than others. New York has its own power market regulator, the New York Independent System Operator, whose mission is to manage "New York’s electric grid and its competitive wholesale electric marketplace." Even under the auspices of that management, prices fluctate, as commodities, like natural gas, and natural resources, like sunlight, fluctuate. Hence the fluctuations supply charge fluctuations on your bill.

On the delivery side, Con Ed sets the "tariff" or price it charges different teirs of customers every year, those prices being approved by the New York Public Service Commission. Still, if you have sharp eye, or are simply keen to examine your bill, you'll notice slight fluctuations in the delivery rate during the months of June, July, August and September. That's becuase for residential "Rate I" customers there are two delivery rates during those months: one for the first 250kwh and one for all electricity consumed after that. See chart below:

From Con Ed's Schedule for Electricity Service
Breaking down your bill

Solar offsets those two charges on your bill, which make up the vast bulk of your electricity expenses.

The other small charges are unavoidable and include:

  • "Merchant Function charge," that's how much Con Ed is charging you to act as an energy buyer or "power broker" (that link is a gag).
  • "GRT and other surchanges," which are sales tax Con Ed must pay the state and so passes on to you.
  • "Basic service charge," the cost of being tied to Con Ed infrastructure and using its customer services.
  • "System Benefit charge," charged to you to fund NYSERDA and clean energy projects in New York.

However, if you oversize your array against your electricity consumption, you can offset those charges as well. This is why at Rivertown Solar, we recommend maximizing your available roof space so that the extra production will not only help during low sun periods, but can also help to offset built-in Con Ed charges.

From the Con Ed solar FAQ: "Once per year, we’re required by law to “cash out” your solar bank – in other words, to pay you for the unused solar credits that you’ve accumulated. We do this by multiplying any excess kilowatt hours you have remaining by the avoided cost of energy. The resulting dollar amount is applied to your account as a credit and your kilowatt hour bank is reset to zero."

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