What is the facilities charge?
Every service we use in our homes or businesses—whether its electricity, cable/satellite television, natural gas, propane or telephone/cell phone—has some form of a monthly charge to cover the cost of providing the service. It might be called a service charge, basic charge, fixed charge or monthly minimum charge. For Midstate Electric Cooperative member/consumers, this monthly charge is called a facilities charge. It is a fair share investment that assures there is power when it is needed.
When you need electric power, all you have to do is flip a switch or plug into an outlet. What happens before that flip of the switch is a significant commitment of time, equipment, facilities and people your cooperative already has in place to ensure that power is there when you need it.
Why is there a facilities charge?
The expenses incurred by MEC for equipment and line maintenance, metering and billing services are relatively fixed; they do not vary according to your electricity use levels. By recovering a portion of these necessary expenditures through the facilities charge, instead of through energy charges (which do vary by levels of use), the costs are distributed fairly among member/consumers.
The facilities charge ensures that our members' expectations for continuous power and outstanding customer service are met. Recent reliability ratings show that out of the 8,760 hours during the year MEC delivered power, the power was on 99.94% of the time, and the latest customer service scores rank your cooperative among the top performing utilities in the country. This high level of service requires an equal investment from each MEC member.
What fixed costs are included in the facilities charge?
Many fixed costs go into operating, maintaining and improving MEC’s system for every existing and future member. These include the costs for electrical system maintenance and replacement, tree trimming, outage restoration, taxes, insurance, materials, fuels and administration of the utility.
Why do utilities charge different amounts for the facilities charge?
The majority of utilities determine the amount of the facilities charge through a cost of service study. Each utility’s circumstances are different. The amount of a utility’s facilities charge can be affected by a number of factors including the number of consumers the utility serves; the size of the utility’s service territory; the number of trees in the area served by the utility; the age of the utility’s system; and the utility’s growth in kWh sales. To help ensure long-term financial stability for the cooperative, the directors and management are working on a ten year plan to bring the monthly facilities charge to the actual cost.
For more information
MEC offers programs to help you better manage your electricity costs, such as free energy audits for homes and businesses, energy conservation tips, energy conservation rebates and payment options. If you would like more information about the facilities charge or our energy management programs, please call 541-536-2126.