Fixed Demand Charge FAQ

Demand refers to the amount of electrical power needed at a specific time. Rather than being about monthly consumption, demand reflects the maximum power needed at any given time. For example, if you turn on several high-energy-consuming appliances simultaneously, such as the heater, oven and washing machine, your demand at that moment spikes.

Peak demand, our highest need, impacts the cost of wholesale power. We must have enough capacity to meet the power demand of all homes and businesses, even when that demand spikes. For Wiregrass Electric Cooperative, this peak occurs consistently from 6 to 9 a.m. during winter.

Every residential account will see a $6 fixed demand charge on their bill. This charge represents a demand of 3 kW, a minimum value for residential meters on our system during our peak demand period, which is 6-9 a.m. during the coldest months. This demand rate is backed by precise data thanks to advanced metering technology.

This charge is linked to the fixed costs year-round due to peak demand. Despite improvements in technology and energy efficiency, this peak climbed last year to an all-time high. Our record-breaking peak on Dec. 24, 2022, meant higher capacity costs for 2023. This, combined with inflation and other factors, makes it necessary to adjust our rate structure to sustain reliable service and promote the long-term health of our cooperative, which is beneficial to all members. By billing for residential demand, we create a fairer way to recoup a portion of these costs.

You’re right, individual households have varying contributions to demand. However, the fixed demand charge represents a common and minimum value that applies to most residential meters on WEC’s system. While some may contribute more to peak demand, the fixed charge ensures that every member pays a fair share toward maintaining the essential capacity and infrastructure.

The fixed charge for residential members ensures simplicity, fairness and awareness of the critical role of demand, helping members make conscious decisions that benefit everyone.

Billing for demand supports WEC’s mission of providing reliable and affordable energy. As a power distributor, we are required to purchase enough capacity from PowerSouth to meet members’ needs, even during moments of highest demand. This strategy also aligns with cooperative principles, encouraging long-term stability and ensuring everyone pays a share tied to their contribution.

We’re exploring more individualized rates reflective of actual demand, designed with our members in mind.

Yes, you can actively contribute to lower peak demand on WEC’s system during the winter months from 6 to 9 a.m. Here’s how you can make a difference:

• Install a water heater timer: By controlling when your water heater operates, you can avoid using it during peak hours.
• Use a programmable thermostat: Setting your thermostat to lower temperatures during peak demand times can make a significant impact. With smart thermostats, you can control your thermostat from your phone even when you’re away.
• Delay high-energy tasks: Activities like washing and drying clothes or running the dishwasher can be shifted to non-peak hours.
• Unplug unused devices: Even if turned off, many electronics still draw power. Unplugging them can reduce unnecessary demand.
• Use energy-efficient appliances: Consider replacing old appliances with energy-efficient ones that operate at a lower capacity.
• Install LED bulbs: LED bulbs consume less energy than traditional bulbs, reducing demand.
• Insulate your home: Proper insulation keeps warmth in and cold out, reducing the need for heating during chilly winter mornings.
• Seal windows and doors: Drafty windows and doors can cause your heating system to work harder. Sealing them helps maintain temperatures.
• Monitor energy consumption: Regularly check your energy usage on your account on our website or through the Wiregrass Electric mobile app, and adopt habits to lower your demand.
• Charge during off-peak hours: If you have an electric vehicle, avoid charging during the hours of 6 to 9 a.m. Consider downloading Optiwatt to help you manage EV charging hours.

Managing power costs is critical. Here’s how WEC and PowerSouth Energy Cooperative are
acting to curtail increases:

1. In a world of fluctuating fuel costs, we’re employing strategic hedging. By locking in gas prices at favorable rates, we’re guarding against unpredictable spikes. It’s a bit like buying insurance against a sudden rise in costs.
2. A power purchase agreement with Vogtle Power Plant adds nuclear energy to our energy portfolio this year, promoting cost stability.
3. The new Lowman Energy Center, which utilizes the most efficient technology to date, leverages natural gas effectively.
4. We work with vendors to stock up on essential items when available and affordable, increasing our inventory thoughtfully, though it requires financial investment.
5. We keep a lean team. WEC’s service has grown, but our workforce remains modest with just 62 full-time employees, less than most similarly sized electric co-ops. We remain efficient and effective by using innovative technology to ensure reliable and quality service.
6. Every dollar counts. Thoughtful spending choices reflect our commitment to affordability without detriment in the quality of our services.

This year’s investments reflect our long-term thinking. We’re planning for tomorrow and the years ahead, guided by our commitment to providing reliable and affordable energy. Your continued trust and support make it possible.

We believe these strategies are a testament to that promise, and we thank you for your continued trust and support.

If you have any other questions or concerns, we’re here to help.