Target 7: Solar panel customers' energy bills triple under new Southside Electric Cooperative rate - WDBJ

Target 7: Solar panel customers’ energy bills triple under new Southside Electric Cooperative rate

BEDFORD COUNTY, Va. (WDBJ) - A local utility company is changing how customers are billed for their electricity usage. While some haven’t noticed a significant difference in their electricity cost, other customers say their bills have tripled with the new structure.

Southside Electric Cooperative (SEC) increased its fee for providing electricity by nearly 3,000%. SEC said this rate is revenue neutral, and doesn’t profit the company, but instead the money is invested into the equipment for energy service.

Customers who use less energy, like families with solar panels, are being charged more under the new structure, on top of their existing solar bills.

Dan Audette lives in Bedford County and has had a solar system for five years. His monthly SEC bills have always been less than $30, but Audette and his wife noticed a staggering spike on their bill last month.

”[It was] a total shock, it was $77,” Audette said. “For five years, it’s always been the same. And then now, it was 77 dollars.”

In February, SEC implemented a new demand rate structure. It charges customers based on their highest electric usage peak throughout the day, rather than their total overall usage.

“Let’s say when the solar system goes down at night, because the sun goes down, and we start the dishwasher, maybe the hot water heater kicks on, we’re running the stove, you’re going to have a spike, a peak,” Audette said. “They’re going to charge you for that.”

The rate went from $0.10 per kilowatt hour (kWh), to $3.00 per kWh.

It’s a 2,900% increase.

That pushed Audette’s electric bill up by 177% from $28.58 to $79.16 in just one month.

“What we’re feeling is solar producers are being targeted with this new structure,” Audette said.

Southside Electric Cooperative posted on its website, “Most members will not see an increase or any change in their monthly bills. Some may see a decrease. A small number of members, estimated at 600 of the roughly 48,000, who place a high demand on the system, although they may not use a great amount of electricity, will see an increase in their bills.”

The company did not make anyone available for an on camera interview, and instead sent Target 7 a statement:

“As a not-for-profit electric cooperative, SEC distributes costs as close to how they are incurred to ensure that they are fair and equitable within each rate class. With the aid of today’s technology, SEC can allocate costs accordingly, instilling confidence in the fairness of our billing system. SEC hires a third-party contractor to provide a cost-of-service study and equitable rate recommendations.”

“We were under the assumption that when we have solar, our bills are actually going to go down, not up,” Audette said. “I overproduce, I put electricity back into the system, and [the company] found a way to charge me more.”

Audette explained he’s reached out to the company, local representatives and the Virginia Attorney General’s office to see what can be done, if anything.

“Any other utility, like cable or phone, you can cancel them, you can go with somebody else. Can’t do that with electricity,” Audette said. “We’re stuck. So what are we supposed to do, except bring it to light?”

Electric companies will usually pay solar producers at the end of every month for putting more electricity back into the grid system for other customers to use. However, Audette explained SEC reduced his payments for overproducing energy from $800 to $80 dollars per month.

The company hasn’t made anyone available to answer our questions, including why this change was made this change in the first place.

A list of resources for how customers can reduce their demand can be found here.

Here is the full statement SEC sent to Target 7:

“SEC implemented a new rate structure in January 2024, which is reflected in February 2024 billing. While the recent adjustments to kWh and kW (Demand) billing may seem complex, rest assured, they are designed to be revenue-neutral to the Cooperative, ensuring fairness for all our members. As a not-for-profit electric cooperative, SEC distributes costs as close to how they are incurred to ensure that they are fair and equitable within each rate class. With the aid of today’s technology, SEC can allocate costs accordingly, instilling confidence in the fairness of our billing system. SEC hires a third-party contractor to provide a cost-of-service study and equitable rate recommendations. Studies forecasted that 600 member bills would increase by $20 or more with this rate realignment. Others would save $20 or more, with no additional revenues received by SEC. On average, the electric bill on a solar account that generates more than it consumes has seen an increase from $26.71 to $56.22. SEC builds an infrastructure to provide electricity to members when and if needed. The system is built to serve the highest electricity demand, much like a road system. A four- or five-lane highway is full of cars at 6 a.m. and 6 p.m. At 3 a.m., the highway has limited traffic. SEC’s infrastructure build-out is much the same. No matter the hour of when power is consumed, SEC must build a readily available system to supply that power. SEC’s last base rate increase was in 2020. SEC provides educational materials and guidance to assist members to control their demand on the system. Do keep in mind that members are only billed for power consumed in the form of kWh or kW (Demand). We encourage members to contact their local electric cooperative with any questions and for ways to save on their electric bills. We are here for our members.”

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