The Los Angeles Department of Water and Power (LADWP) and Southern California Edison (SCE) are two of the major municipal utility corporations in California and the United States, serving more than 4-15 million people in the Los Angeles area and the state’s southern region.
Many energy consumers around the country receive their electric bill each month and pay it without truly delving into the specifics of what they’re actually paying for…and we’re here to break it down. In this post, we’ll go over the most critical aspects of your LADWP and SCE power bills, as well as how they alter once you add solar panels.
Your power use and your rate plan/schedule are two critical aspects in deciding how much you’ll owe on your electricity bill.
The amount of power you consume in a particular month is measured in kilowatt-hours (kWh). This amount might vary greatly depending on your consumption patterns – many homeowners use more electricity during the summer months when they operate their air conditioning systems and have lower power bills during the winter months. Rather than just looking at the total cost of your account, it’s crucial to keep note of how your monthly power use changes over time. When you see that your power bill is rising owing to an increase in use (which you can control) rather than a rise in utility rates, you have the chance to adjust your electricity usage habits and save money.
Because of LADWP’s tier allowances and SCE’s baseline allowance, understanding your power use is very critical. Simply explained, LADWP developed tiers that indicate the quantity of kWh you may consume before moving up a tier and paying a higher fee. Tier and baseline allowances vary by region and season, but it’s typically a good idea to be as energy-efficient as possible to increase your chances of being in Tier 1–and therefore paying the lowest rate possible.
Importantly, LADWP’s tiers fluctuate depending on where you live: their service region is separated into Zone 1 and Zone 2, each with its own set of use allowances–you can find out which zone you’re in by Googling your zip code on their website.
Following that, rate plans: you may or not be aware of the rate plan you are on (or even that you have the opportunity to change it). Many energy providers have default rate options for their consumers that stay in place except if you intentionally request a different rate.
LADWP and SCE have plans that differ not just in price but also in the structure; two of the most frequent varieties are a tiered-rate plan and a time-of-use plan.
If you have a tiered-rate plan (e.g., R-1A / Schedule D), you will be billed a fixed rate for each kWh of power you use until you reach your tier allotment; the more energy you consume, the higher the tier, and the more you will be paid for each kWh of electricity.
LADWAP’s time-of-use (TOU) plans (for example, R-1B) and SCE’s time-of-use (TOU) plans, on the other hand, charge different rates for power based on the day, time, and seasons. This is known as a “time-varying rate” structure since the cost of power fluctuates depending on when you use it. Lower rates are available when the demand for power is low (in the morning and late at night), but you will pay more during “peak hours,” when the demand for electricity is high (evening hours).
Finally, if you own an electric car, SCE has a TOU-D-PRIME EV rate plan. This plan motivates EV or plug-in hybrid vehicle owners to charge their cars overnight when overall power consumption is low. You may save a lot of money by charging your car during off-peak hours rather than during the day or just after work when prices are at their highest.
Electricity bills frequently have a number of complicated phrases and line items on them, making it tough to figure out what your all-in rate is.
However, unlike many utility providers, LADWP’s statement is rather easy to decipher, with fewer line item costs — all of your power rates are broken down by tier under the appropriately called “Electric Charges” portion of your account. In general, you may divide the cost of electricity into three categories: supply, distribution/transmission, and miscellaneous. These prices cover the power you consume, as well as the cost of delivering electricity to your house or company and any additional charges or taxes associated with grid maintenance.
It’s easier to think of supply costs as paying for the actual electricity you consume. All of your supply charges may be found on the portion of your SCE account called “Generation charges.”
Utilities around the country charge varied rates for energy delivery based on the power plant from which it is generated and the cost of the fuel (i.e. coal or natural gas). The majority of the power provided by LADWP in 2018 came from renewable energy resources (32%), but they also delivered a significant quantity of energy generated from natural gas (30%) and coal (30%). (18 percent). In 2019, SCE delivers a significant quantity of electricity from renewable energy resources (35.1 percent), as well as a decent proportion of energy generated by natural gas (16.1), nuclear power plants (8.2 percent), or undefined sources of power (32.6 percent).
Importantly, while SCE provides power to your house, you are paying someone else for supply: California has a largely deregulated electricity market, which means that corporations other than utility companies can acquire and sell electricity. Community choice aggregation (CCA) systems, which are becoming increasingly popular in California, enable local governments to pool their citizens’ power purchases. Many communities use this to provide lower-cost, greener power to the community. If you find a different corporation or organization named in the supply part of your account, this might be the CCA provider for your area.
Distribution and transmission
Distribution and transmission costs, also known as delivery charges, are fees charged by LADWP and SCE to supply energy to you. These fees are used by the utility company to construct and maintain the poles and electrical cables that carry energy from power plants to your home. You may think of the delivery fee as being the same as paying for shipping and handling on any online purchase. Your distribution and transmission costs will appear on the third page of your SCE account under “Delivery charges.”
Utility providers frequently impose a lot of extra charges on their bills in addition to paying supply and demand. These fees are sometimes given as a flat cost that is unrelated to how much power you use, and other times they are provided as a volumetric rate, in which you pay more each month depending on how much electricity you consume.
On the left-hand side of your power statement, LADWP may include a number of bill modifications, including an Energy Cost Adjustment (ECA), a Power Access Charge (PAC), and an Electricity Subsidy Adjustment (ESA), among others. It may be broken out as a distinct line item or rolled into your all-in rate, depending on the fee.
If you reside in a state with energy efficiency targets or a renewable energy requirement, for example, a portion of your monthly charges may go toward supporting sustainable energy projects, according to SCE. Nuclear decommissioning costs (which help make nuclear power reactors safe to shut down) and public purpose program charges are two instances of this for SCE consumers (which go towards funding energy efficiency and low-income programs). In addition, most utilities, including SCE, levy a customer fee, which is a monthly bill price that is independent to how much power you consume. The fee for SCE is a set amount per day of service throughout a billing cycle.
You will continue to get your monthly power bills from LADWP after you install solar panels. Each monthly statement will include a summary of kWh provided and kWh received (i.e. how much solar power you give back to LADWP) (i.e. how much electricity LADWP delivered to you from the grid). This is a demonstration of net metering, a solar incentive that allows you to claim credits for any extra solar energy you transmit to the grid. When your solar panel system isn’t generating enough power to satisfy your demands, you may utilize these credits to offset what you need from the grid (like at night).
LADWP customers who have rooftop solar panels are put on a time-of-use (TOU) plan, just like other major utility providers in California. The kWh you contributed to the grid and the kWh you received from the grid will be broken down into three buckets on your bill: base, low peak, and high peak. Negative numbers indicate credits that you can use in the future. Positive numbers indicate that you used more power from the grid during that time period than your solar panel system produced, thus you’ll have to pay LADWP for it.
You’ll see a “Net Metering” bank at the bottom of your statement, which indicates your net metering credit amount from past months. If you consume more power than your solar panel system produces, you may use these credits for your future monthly bills. You can’t use these credits to pay for taxes or other expenses that aren’t connected to your power use (i.e. the water portion of your bill).
SCE will send you regular power bills once you install solar panels. Non-bypassable charges (NBCs) are costs that must be paid each month in order to remain connected to the grid.
A breakdown of your Generation and Delivery rates is also included on your monthly statement. Any solar credits you obtain through net metering will be included in these expenses. Net metering is a solar incentive that allows you to receive credits for any extra solar power you deliver to the grid. When your solar panel system isn’t producing enough power to satisfy your demands, you may utilize these credits to offset what you need from the grid (like at night).
To take advantage of the state’s net metering 2.0 (NEM 2.0) program, new solar consumers in California must enroll in a time-of-use (TOU) plan. The value of your solar credits under this plan is determined by the time of day you send it to the grid and whether it occurred during peak hours (when power is most costly) or off-peak hours (when electricity is least expensive) (when electricity is the most affordable).
You’ll notice different rates for On-peak, Off-peak, and Super-off-peak consumption in your delivery and generating charges summary. If you see negative numbers here, there are credits that you may use in the future. Positive numbers mean you use more power from the grid than your solar panel system produced, and you’ll have to pay SCE for it.
Even if your monthly statement shows a net positive consumption, you don’t have to pay it just yet — SCE customers can request an Annual Billing Statement. This is a yearly bill that outlines the overall amount you owe SCE, taking into account how much power your solar panel system exported to the grid and how much electricity you received from the grid over the course of a year.
You’ll notice a line item for Net Surplus Energy Compensation on your annual billing statement if you send more power to the grid than you consume during this time period and have a negative balance (NSC). SCE effectively takes any unused credits from your annual paying term and resells them at a cheaper wholesale cost (known as the net surplus compensation rate). You have the option of applying this monetary credit to your next payment cycle or receiving the amount as a check.
Community solar is an excellent method to help your community create sustainable energy jobs. Community solar works by allowing you to subscribe to local solar projects in exchange for power bill credits.
Join the hundreds of LADWP and SCE customers who are already saving money with solar in one of the sunniest cities in the country! Get free quotations by contacting us online! These rates give customized savings estimates based on your power use, your current rate, and your property’s solar potential. Don’t hesitate to call us at 1-714-694-2262 if you’d like to get a general estimate of solar expenses and savings.