What are the charges on my Con Edison bill?
A Con Ed bill is confusing, so in this post we will be discussing each line item so that you can be more aware what you are being charged.Before we get started there is something that you probably already have a question about that needs to be explained in order to help you to understand each line item later.
What is the difference between Demand and Energy? Demand is measured in Kilowatts (KW) while energy is measured in kilowatt hours (kWh). Demand is the highest amount of electricity measured during a given 30 minute period in the month. This highest amount has a charge associated with it to reserve that amount of space on the grid. This ensures that if you usage spikes you will still be getting all of the electricity you need. Energy is the amount of electricity you use over the course of the month, measured by kilowatt hour.
Supply is the function of purchasing your electricity to cover the amount of electricity you used between meter reads. The cost also covers transporting that electricity to the grid.
This is a charge for the exact amount of electricity you used during the meter read. The amount of electricity is then multiplied by a rate, usually in cents, and then give you your total energy supply charge.The rate here is actually a prediction of Con Edison’s cost, not the current price of the commodity. So the rate may change drastically on a month to month basis due to the changes in the spot and day ahead electricity markets.
This is the charge for the demand, the highest amount of electricity you used during any one given point during a meter read. This charge is for the space that is reserved to you on the grid. The
Merchant Function Charge
The merchant function charge is a charge associated with procuring electricity, credit, and collection related activities and uncollectable accounts. This covers the daily costs of the team tasked with purchasing electricity and the call center employees who answer your calls all day long. This item may also be eliminated if you choose to work with an energy service company (Esco).
GRT & other Tax Surcharges
Gross Receipts Taxes or GRT are taxes on Con Edison gross receipt from sale of utility services and other tax surcharges. This charge goes to state and local governments, it also includes a transit tax. The state charges Con Ed a tax on its gross receipts and Con Ed then charges that to you on your bill. A small percentage of this charge also helps fund the New York City MTA.
Delivery is the function of delivering the electricity to your home or business through the infrastructure (pipes, wiring, etc) that Con Edison owns.
Basic Service Charge
The Basic Service charge is a charge that all Con Edison customers receive on a monthly basis. This charge is fixed, therefore it is the same every month no matter what. The cost covers the meter, the meter reading, and maintenance of the meter on a regular basis.The charge also includes a billing and payment charge, which is fixed at $1.20. This charge covers the cost to create your bill, send you your bill, and process your payment. Some or all of these charges can be eliminated if you choose to work with an Esco.
This charge is the delivery of the amount of electricity used during the billing period. Con Ed charges you to get the electricity to your business, and also uses this to maintain and ensure their infrastructure is sufficient.
This is a charge for the amount of space in KW that your business needs to reserve just incase you use the highest amount of energy at another point in the month. This is a charge associated with the grid and also helps to maintain the grid and ensure the infrastructure is sufficient.
System Benefit Charge
The Systems Benefit Charge or SBC is a charge that covers the costs associated with clean energy activities conducted by the New York State Energy Research and Development Authority (NYSERDA) and energy efficiency projects implemented by the company. This charge supports NYSERDA which is an organization focused on clean energy R&D as well as reducing overall demand on the grid.
Temporary NY State Surcharge
This is a charge by the State of New York that covers and new fees that the state imposes on the utility. It also encourages the conservation of energy and other resources provided through the utility.
GRT & other Tax Surcharges
(Same as for Supply) Gross Receipts Taxes or GRT are taxes on Con Edison gross receipt from sale of utility services and other tax surcharges. This charge goes to state and local governments, it also includes a transit tax. The state charges Con Ed a tax on its gross receipts and Con Ed then charges that to you on your bill. A small percentage of this charge also helps fund the New York City MTA.
The last line on a Con Ed bill is the sales tax, typically it is 8.8750%. This is a combo of sales tax from the state (4.375%) and a sales tax from the city of New York (4.5%). The state sales tax can be eliminated if you choose to work with an Esco.
This post should hopefully clear up questions about where your money is going to when you pay your Con Edison bill on a monthly basis. If you have any more specific questions about your bill shoot us an email at firstname.lastname@example.org.