Actual energy used to power a facility, known as a commodity cost, accounts for less than 50% of a utility bill.
The other half of the utility bill is known as non-commodity charges and continues to increase.
Five utility costs to watch (Percentage of Utility Bill):
- Environmental and Renewable – charge for climate actions…these charges will continue to be higher over time (15%).
- Distribution – cost of moving energy from a plant to an outlet….last five years a 6% increase (20%).
- Energy Commodity – the cost of what comes out of a generator (47%).
- Capacity and Transmission – charges for poles, wires and other grid technology….a 91% increase since 2011 (15%).
- Miscellaneous – expenses from Government tariffs and related fees…charges relatively static (3%).
How to reduce the Five Utility Costs:
- Environmental and Renewable – look for Green Energy with tax exempt programs.
- Distribution – track how and when you use your energy and determine when you use the most, time frame.
- Energy Commodity – understand your energy exposure….review your energy buying patterns…track energy use and develop a policy and strategy for buying electric and natural gas.
- Capacity and Transmission – manage your peak demand loads…a fundamental change in energy mix is changing pricing signals…look at a Demand Response Program.
- Miscellaneous – limited control over these costs since they are determined by Governmental rules within each state.
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