It is a common complaint of rural U.P. residents: their power bills are too high. Upper Michigan's Source has broken down the numbers, comparing two power providers that reach some of the most isolated parts of our area.
The Upper Peninsula Power Company serves around 55,000 customers throughout ten counties, according to UPPCO's customer care manager, Jodi Pineau.
"It comes out to equate to about twelve customers per square mile, and the difficulty there is you have less customers to share cost, thus the costs are a little bit higher," said Pineau.
Meantime, the Alger-Delta Electric Co-op covers six counties and 10,000 consumers, according to their general manager, Tom Harrell.
"We work very aggressively at providing a good value to our members, trying to keep rates low and just provide energy that's affordable, reliable, and safe," said Harrell.
Reliable service is ensured by routine maintenance. That is paid for through flat service charges on customers' bills. Each month, Alger-Delta customers pay a $25 service charge, while UPPCO customers pay $11.
Alger-Delta approved this charge in October 2010, and at the same time, they decreased their energy rate. General Manager Tom Harrell said over the years, they have transitioned to a higher service charge and a more moderate energy rate.
"Taking the steps that we've taken in modifying our rate structure actually helps keep energy affordable for those who live here year-round," he said.
UPPCO customer care manager Jodi Pineau said a change like this is not unusual.
"It's not unusual. You see a lot of companies going toward the model that Alger-Delta uses, because the $11 customer charge that we have actually doesn't cover the full cost of service to a customer," she said.
The higher service charge does not necessarily mean Alger-Delta customers have higher monthly bills than UPPCO users.
"We break down the energy costs a little further," Pineau said.
At $0.10038 per kilowatt hour (kwh), UPPCO charges a lower rate for power supply than Alger-Delta, who collects $0.14900/kwh. But UPPCO also charges a distribution fee, which is $0.08312/kwh. UPPCO fees for Iron River customers vary. They pay $0.10117/kwh for power supply, and their distribution fee is $0.07219/kwh.$0.07219 per kWh Power Supply Service $0.10038 per kWh $0.10117 per kWh
A customer that uses 575 kwh would see a monthly bill of $116.37 from Alger-Delta, but UPPCO is $4.37 higher with a $120.74 bill. All of these rates are approved by the Michigan Public Service Commission.
These rates are higher than some other providers around the region. For a Marquette Board of Light and Power customer inside Marquette city limits, where customers live much closer together, they would see a monthly bill of around $48.28.
Consumers of power from Northwestern Wisconsin Electric Company pay $78.05 a month for 575 kwh. NWE is an investor-owned electric utility that serves approximately 11,500 customers in Burnett and Polk counties of Wisconsin. Wisconsin Electric customers pay $86.90 a month. These numbers are according to the Wisconsin Public Service Commission.
Information from the U.S. Energy Information Administration shows as of October 2012, the average rate in the state of Michigan is $0.1423/kwh. For Wisconsin, customers pay an average of $0.1351/kwh. Both figures are above the national average of $0.1203.
UPPCO last raised rates in January 2012. The last increase by Alger-Delta came in October 2010. Both providers actively work to keep rates low for customers. UPPCO reads their meters bi-monthly.
"If we would have to read monthly, that would incur about a million dollars in cost, additional cost," Pineau said.
Harrell said Alger-Delta does a lot of preventative maintenance, like tree work.
"We're still working our way through the system; it's been a long time since it was completely worked over in terms of vegetation management," he said.
Another fee that electric customers throughout the state of Michigan see on their bills is an energy optimization charge. Customers pay different amounts based on their electric providers' revenue. Alger-Delta consumers pay $0.00210/kwh, while UPPCO collects $0.00350/kwh. That money is either given to a state program or companies can create a program of their own.
Alger Delta customers can click here: http://www.michigan-energy.org/AlgerDelta and UPPCO customers can click here: http://www.efficiencyunited.com/ for more information about how to utilize their energy optimization charge.
"We encourage customers to try to re-coup some of the costs of that they are putting into those programs. Different rebates, might be some lighting, appliances, they've picked up some old, inefficient refrigerators as a program," Pineau added.