We are aware of customers who forgo a hot lunch, make their children sit in the dark, leave home to seek out relief, or who turn the air conditioning off on 90-degree days to avoid these excessive charges.
Demand charges are a radical departure from how residential customers are billed. Recent utility proposals have attempted to extend demand charges to both small businesses and residences. Residential customers lack the ability to control their demand and should not be required to invest in expensive technology just to avoid sky high electricity bills.
Demand charges may be common for commercial and industrial customers who have special technology or employees specifically hired to manage peak demand and control appliances, but they just don’t make sense for homeowners.
Furthermore, an individual homeowner’s demand doesn’t affect the management of the grid like a larger commercial or industrial customer such as a big box store or an office building. Small businesses are not usually charged based on peak demand either, and similarly lack the ability to control demand charges.
It’s a 'gotcha' kind of charge.
The Alliance for Solar Choice: Stop Demand Charges 2016 © ALL RIGHTS RESERVED
And if approved by the ACC, demand charges would be difficult for most consumers to understand. Consumers often don’t know when their household is experiencing its maximum electricity usage. This makes it nearly impossible for ratepayers to keep their electric bill as low as possible.
All investor-owned utility proposals to implement demand charges have either been rejected by the state's regulatory body or withdrawn entirely across dozens of states, now with the exception of Massachusetts. Demand charges are not in the public interest, and recourse actions are being pursued in Massachusetts.
Investor-owned utilities have proposed demand charges for some or all residential customers in Arizona, Arkansas, California, the District of Columbia, Georgia, Idaho, Illinois, Iowa, Kansas, Massachusetts, Montana, Nevada, New York, South Dakota, Tennessee, Texas, Oklahoma, and Utah.
"...we find there would be a large number of residential customers that have neither the desire, nor the inclination, to manage demand or to understand demand, but I guess the bottom line on that is I think it would be very difficult, were she still with us, to put my grandma on a demand charge."
Mark Bonsall, SRP General Manager
“[Oklahoma utility spokesperson] said it’s impossible to calculate what a rooftop solar customer’s actual charge will be...”
(Climate Central, 11/10/2015)
"I just didn't have the stomach to do [demand charges] considering all the other things we were doing at the time," Nevada Commissioner David Noble, admitting demand charges go too far after eliminating net metering, levying massive fees on solar customers, and pulling a bait and switch on existing solar customers.
(AZ Central, 3/14/2016)
APS Attorney: "I am just going to ask you one thing. I am not saying this might be their ideal thing, but couldn't they go to a mall or a movie or something like that for awhile?"
WRA Expert: "Every day? 30 days?"
APS Attorney: "A lot of mall walkers."
WRA Expert: "For five hours?"
(Excerpt from Unisource hearing between an APS Attorney and Western Resource Advocates Expert, 3/16/2016)
AARP Illinois, Citizen, Action Illinois, Heartland Alliance for Human Needs & Human Rights, Illinois Asset Building Group, Illinois PIRG, Sargent Shriver National Center on Poverty Law, and the Woodstock Institute.
Two words: extremely confusing. We made a video to help explain them below.
For many of our members, energy affordability is a serious and pressing concern. Under this proposal, individual customers could experience dramatic increases in their bills simply as a result of when they chose to use an appliance. If this customer is low income, one expensive and unexpected utility bill can quickly turn into a financial crisis.