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<blockquote data-quote="GoingNorth" data-source="post: 331472" data-attributes="member: 1963"><p>Well, the cost of electricity is based on the cost of production, e.g. how much coal or gas does it take to make the electricity, plus costs of transmission, etc.</p><p></p><p>In addition, many power companies buy on what they call the "spot market"</p><p>This means that the costs float and are based on the contracted amt the utilities pay for that energy that month.</p><p></p><p>Natural gas works the same way. Up here in our area of WI, the power companies purchase on a six month spot contract. Because of that, it is quite possible to see changes in your power bill that don't reflect current actual pricing.</p><p></p><p>Most US power companies have some sort of budget plans. With one of those, they base your charge for a six month period based on your charge for actual usage during an equivalent period. At the end of that period, your usage and fees are reassessed and your rates may change. In the case of usage credits, they credit the overage back to your account.</p><p></p><p>Again, I cannot recommend highly enough that you get on a budget plan. Yes, it does mean you will pay more for utilities in the summer, but it also means you don't get clobbered in the winter.</p><p></p><p>The major downside to all of this is that many utilities will not put you on a budget plan unless you are both current on your utility bills AND have a good past payment history with them.</p></blockquote><p></p>
[QUOTE="GoingNorth, post: 331472, member: 1963"] Well, the cost of electricity is based on the cost of production, e.g. how much coal or gas does it take to make the electricity, plus costs of transmission, etc. In addition, many power companies buy on what they call the "spot market" This means that the costs float and are based on the contracted amt the utilities pay for that energy that month. Natural gas works the same way. Up here in our area of WI, the power companies purchase on a six month spot contract. Because of that, it is quite possible to see changes in your power bill that don't reflect current actual pricing. Most US power companies have some sort of budget plans. With one of those, they base your charge for a six month period based on your charge for actual usage during an equivalent period. At the end of that period, your usage and fees are reassessed and your rates may change. In the case of usage credits, they credit the overage back to your account. Again, I cannot recommend highly enough that you get on a budget plan. Yes, it does mean you will pay more for utilities in the summer, but it also means you don't get clobbered in the winter. The major downside to all of this is that many utilities will not put you on a budget plan unless you are both current on your utility bills AND have a good past payment history with them. [/QUOTE]
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