Hughesville, MD – March 11, 2020 – Southern Maryland Electric Cooperative’s (SMECO) Board of Directors has approved a decrease for the power supply rates that customer-members pay for their electric service. Upon Board approval, SMECO submitted a filing to the Maryland Public Service Commission (PSC), to reduce its base energy charges by more than 10 percent for residential customers. If the filing submitted on February 28, 2020, is approved by the PSC, the lower rates will go into effect with May 2020 bills.
Sonja M. Cox, SMECO president and CEO, explained, “Our residential base rate for May will be the lowest it has been in almost 15 years. Nearly all customer classes—commercial accounts, schools, government buildings, and churches—will have their energy rates reduced. Lower rates can make a huge impact, especially on facilities that use a lot of energy.”
The base rate for an average residential customer with 1,300 kilowatt-hours (kWh) of monthly usage will be $10.40 less this summer than last summer. SMECO’s Standard Offer Service (SOS) rate is made up of the energy charge and the Power Cost Adjustment (PCA). On SMECO’s monthly electric bills, lower power supply costs have been reflected in the PCA, which has been a credit for the last six months.
“When SMECO purchases energy at a lower cost on the wholesale market, those savings are passed on to our customer-members,” Cox said. “SMECO’s power portfolio includes electricity that is produced by multiple sources of energy, such as wind, solar, nuclear, and coal. About 60 percent of our energy comes from natural gas, and the lower prices that we’ve been seeing have a positive impact on customer rates.”
SMECO’s base residential energy charges for summer will decrease by 11 percent, from 6.98 cents per kWh to 6.21 cents per kWh. Summer energy charges appear on bills rendered May through September. Base residential winter energy charges will be reduced from 7.54 cents per kWh to 6.74 cents per kWh, a 10.6 percent reduction.
The PCA, which changes monthly, is a credit of 0.8937 cents per kWh for March. The combination of the base energy charge and the PCA credit effectively reduces the SOS rate from 7.54 cents per kWh to 6.6463 cents per kWh.