Smart Meter Rip-off

Have you noticed higher electric bills since Southern California Edison Company replaced your analog meter with the new smart meter.  There are many advantages to this new meter.  It's digital, so it is easier to read, you can moniter your usage online, and the electric company can lay off all meter readers which saves them money.  Did the electric company reduce your rates for that savings?  No, they are actually using the technology to raise your rates without you knowing it.  They actually confuse the public and send you an 8 page bill with all kinds of information regarding transmission charges, delivery charges, taxes and the like.  I am a degreed acountant and find it difficult to figure out.

 Since the electric company has a monopoly to provide your electricity, the government regulates how much they can charge you.  They determined that a small apartment needed a minimum amout of electricity to operate their household per month.   That is how they came up with these tiered rates.  The tiered rates are also meant to encourage conservation.  People with smaller houses would generally use less energy and would not be subjected to the higher rates.  So the government and utilities agreed on a monthly allowance of energy usage.  Currently in my area, they agreed to 480 kwh per month during the summer months, June - September and 315 kwh the rest of the year.  People with analog meters pay 13 cents for the first 480 kwh used during the summer months, 15 cents for the next 144 kwh, 25 cents for the next 336 kwh, 28 cents for the next 480 kwh, and the final tier is 32 cents per kwh.  Because the electric company bills for different number of days in a billing period, they divide this 480 by 30 days which gives you a daily allowance of 16 per day. Their billing period changes from month to month from 28 to 32 days. 

As you can see, it is in the electric company's best interest to shift your rates to a higher tier whenever possible.  Tier 2 is a 16% increase, tier 3 is a 92% increase, tier 4 is 115% increase and the final tier 5 is a whopping 146% more per kwh.  With the older analog meter, your meter is read once monthly and you are charged based on your monthly useage.  If you use less than 16 kwh on average for the billing period you are billed at 13 cents per kwh.  You do not pay higher tier rates until you exceed 480 kwh on a monthly basis.  So if you noticed you are using too much energy at the beginning and middle of the month, you could reduce your usage the rest of the month, maybe go out of town for a week. 

Lets see what happens with the new smart meter.  With this new meter, they no longer give a full 480 kwh at the low tier unless you use the full 16 kwh every day.  Your bill is calculated every day based on that daily usage.  Under this plan you cannot conserve energy another day to reclaim your overusage from a previous day.  This is how they throw you into higher tiers and increase your costs even though you may not be using more energy.  Each day you get 16 kwh, if you exceed that amount you are thrown into a higher tier for that day by this calculation.  You get 4.8 kwh(30% of base) at tier 2 rates, 11.2 kwh(70% of base) at tier 3 rates, 16 kwh(100% of base) at tier 4 rates, and the balance into tier 5 rates.  With central air conditioning on hot summer days it is very difficult to stay in the low tier for the day. 

Here is an annalysis of my August 17 bill.  This billing period was for 29 days, all in the high useage summer period.  I used 454 kwh this billing period.  Under the analog meter all my units would be in the first tier at 13 cents per kwh.  This is because I qualify for 29 days times 16 kwh per day which comes to 464 kwh in the first tier.  454 kwh times 13 cents equal $59.02 which is what my bill would be with the old meter.  They billed me $68.98.  This is a 17% overcharge and this is on a relatively small bill. 

In the understanding your bill, they hide their overbilling by showing your average cost per kwh.  What they do is shrink the tiers to justify their overcharges.  As you can see in the chart, they reduced my tier 1 rates to 287 kwh, 77 kwh in tier 2, and 90 kwh in tier 3.  Based on their average cost per kilowatt hour chart, I should get 30% of my base kwh which comes to 86.  So this chart is not accurate.  They use it to hide the days I went into the 4th tier and did not know it.  Please continue to my next post Smart meter continued.