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Understanding your Commercial Electricity Bill

Understanding your Commercial Electricity Bill

Despite the fact that energy consumption is often one of a business’s biggest overhead costs, electricity bills are generally paid without a second glance. Understanding your commercial electricity bill will allow you to pick out the relevant information that impacts your energy strategy. This can be particularly helpful for companies that are considering sustainability initiatives, renewable energy, or energy efficiency improvements.


Let’s look at this sample Xcel bill from a commercial client and dig deeper to see what lies beneath that total monthly charge. 

Found on Xcel Bill Page 2

Electricity Charges

What You Need To Know:

The electricity charges section breaks down each component of your total monthly bill. Some charges include usage units and a per kwh rate, which show how they are impacted by your monthly energy usage. 

It’s also worth taking a closer look at the charges that aren’t explained on the bill. The Resource Adjustment includes costs related to several different conservation and renewable energy programs. Each program has a per kilowatt hour rate that is multiplied by your billed usage to formulate the total charge. The Affordability Charge is a flat monthly surcharge that offsets costs of offering bill payment assistance and discount programs to low-income customers. The charge varies based on customer type, and this commercial client pays $3.60 per month.

So what is the difference between a Charge and a True Up? Each year Xcel predicts the costs of energy and sets rates based on those predictions. When actual energy production costs rise or fall, Xcel adjusts prices accordingly and adds the difference to your bill as a ‘true up’. If energy prices fluctuate multiple times during the month, there will be multiple true ups. The total kWh of those true ups will equal your total billed usage.

Resource Adjustment Note:

Energy subsidies have long been a controversial topic. Virtually all sources of energy are subsidized, and unlike some subsidies, this one is directly mentioned on the bill. Powering your facility with solar can directly reduce the amount you pay into this fund.

Electricity Charges Glossary: 

  • Rate: Xcel charges customers different rates for their energy, depending on their maximum demand. This customer’s demand is 708 kW, which falls under the General Service Rate.
  • Basic Service Charge: This charge stays the same regardless of your usage. It covers the cost of providing you with energy service, such as electric and gas line maintenance. 
  • Energy Charge: This is the amount you pay per kwh for electricity usage. It includes the cost to generate the electricity you use, and costs to own, operate and maintain the power plants that produce it.
  • Fuel Cost Charge: This is the cost of the fuel used to generate electricity. It is a straight pass-through to you. Electric utilities calculate the total cost for fuel sources to generate electricity each month and pass those costs on to you as charges.
  • Sales True Up:  Each year Xcel predicts the costs of energy and sets rates based on those predictions. When actual energy production costs rise or fall, xcel adjusts prices accordingly. These adjustments show up on your bill as ‘true ups’. If energy prices fluctuate multiple times during the month, there will be multiple true ups. The total kWh of those true ups will equal your total billed usage.
  • Demand Charge (winter): Xcel applies demand charges based on the maximum amount of power that a customer uses in any 15 minute interval during the billing cycle. Demand charges usually apply to commercial and industrial customers, who tend to have higher peak loads. The rate for these charges changes seasonally. 
  • Affordability Charge: This is a surcharge to recover the costs of offering bill payment assistance and discount programs to low-income customers. 
  • Resource Adjustment: This includes costs related to several conservation and renewable energy programs. You can see the full list here. 
  • City Fees: In some cities Xcel Energy is required to collect a fee on behalf of the city.

Meter Reading Information

What You Need To Know:

The meter reading information section breaks down your energy usage during the last billing cycle. In this section we are looking for two things: your total billed energy usage and your instantaneous demand.

Your total billed usage can be found in the Total Energy row. Since your meter counts up cumulative energy used, the Current Reading isn’t actually the amount of energy used this month, its the total amount you’ve used since the meter was installed. You can take the Current Reading and Subtract the Previous Reading to find the amount of energy used this month. Use the multiplier in the top left-hand corner of the table (in this case 300) to get your Billed Usage in the far right column.  

The Demand row of the Billed Usage column shows the maximum amount of power you used within a single 15-minute interval. 

These two numbers show up as the Energy Charge and Demand Charge in the ‘Electricity Charges’ section of your bill. 

Meter Reading Information Glossary:

  • Current & Previous Reading: These columns show the cumulative energy reading from your meter during the current and previous billing cycles. THIS DOES NOT SHOW HOW MUCH ENERGY YOU USED THIS PERIOD. You can subtract the previous reading from the current reading to get your measured usage. 
  • Measured Usage: This is how much actual electricity in kilowatts that you used during this billing period, measured by your electric meter.
  • Billed Usage: Your measured usage is put into an equation that determines the total units of energy consumed. That number is your billed usage, and is what Xcel bases your monthly charges on.  
  • Total Energy: Energy can be broken down into multiple components. This includes all of them. 
  • Reactive Energy: Reactive energy is one of those components that contributes to total energy. 
  • Demand: Demand is a measure of how much instantaneous power a customer uses at a given time. Xcel calculates demand based on the maximum amount of power that a customer uses in any 15 minute interval during the billing cycle. 
  • Billable Demand: If this number is higher than Demand in the row above, you’re getting penalized for your power factor. 
  • Power Factor Demand: Power factor attempts to show how efficiently you are using the energy supplied to you. If your power factor is 100%, you’re using 100% of the supplied energy. A lower power factor means that you aren’t using all of the power supplied to you.

Found on Xcel Bill Page 1

Account Balance

What You Need To Know:

Your total account balance is the first thing you see on your bill, and the last piece of the puzzle. Its helpful to look at your usage information and the specific charges on your bill to get the full picture of your energy expenses.

If you are looking to spend less on energy bills, our experts are happy to help you evaluate your businesses’ solar potential. 

Account Balance Glossary:

  • Balance Forward: If this is zero, you’re up to date on your payments. 
  • Amount Due: This is the total amount you owe for energy this month. You can compare this amount to your Previous Balance to see if you’re paying more or less than last month.

Want help understanding your commercial electricity bill? We can help.

If your company is considering sustainability initiatives, renewable energy, or energy efficiency improvements, we’re happy to hear from you. Impact Power Solutions has been helping organizations implement solar projects for over 30 years. If you’re interested in learning more about your commercial electricity bill or want to see how solar can work for your organization, reach out to us today! 

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Reflecting on the UK Trade Mission

By Eric Pasi

It was an honor to join Minnesota Governor Tim Walz on a trade mission to Europe in mid-November. The delegation was filled with experts from various fields including ours, Energy and Environment. I was only able to join for the UK portion which was jam-packed with productive meetings, conversations, and idea-sharing. Regional Trade Manager Steve Riedel from Minnesota Department of Economic Development was a great leader for our Environment and Energy delegation. He helped identify and facilitate a variety of engagements with our European counterparts, distilled into concise daily agendas.

There were multiple references to the “special relationship” enjoyed by the US and UK. In terms of climate goals, Minnesota and the UK share an outsized ambition to significantly curb GHG emissions over the next few decades. Our common interests include the accelerated adoption of cold-climate electric heat pumps, electrification of our transportation industries, and advent of offshore wind technologies in the US, much of which has been pioneered in the UK.

Several event highlights included visiting start-up accelerator Sustainable Ventures, whose offices boasted an incredible view of parliament and Big Ben. We toured London’s greenest office building at Southworks and learned about AI technology for autonomous vehicles at the Smart Mobility Living Lab. My favorite part of the trip had to be the briefing and social hour at the US Embassy, which played host to most of our UK collaborators.

An obligatory selfie of Eric Pasi at the United States Embassy in the United Kingdom.

The view of Parliament and Big Ben as seen from Sustainable Ventures.

At the conclusion of our trip I was thankful to have had an opportunity to share my relevant experience with our counterparts in London. The intersection between clean, but intermittent resources like wind and solar, and flexible loads like electric cars, green hydrogen, and heat pumps can improve the grid and reduce costs. The orchestration between generation and loads will be absolutely critical. Several contacts I met specialize in different facets of these value chains; fostering further innovation in this space will help ratepayers, utilities, and the planet. I look forward to building on these relationships and ideas in my development role at IPS.

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The Omnibus Energy Bill and What Solar Means for Schools

SCHOOL | Snail Lake Kindergarten | Shoreview, MN | 40 kW SystemSCHOOL | Snail Lake Kindergarten | Shoreview, MN | 40 kW System

The Omnibus Energy Bill

Minnesota legislators recently approved the omnibus commerce and energy policy and finance bill. The aim of the bill is to support renewables, electric vehicle charging infrastructure, make prescription drugs more affordable, and provide additional rights to student loan borrowers. As far as energy is concerned, over $60 million will be used by the renewable development account for the following:

  • Reaching net zero emissions by 2050.
  • Establishing building electrification goals.
  • Creating a process and transition program for retiring generation facilities.
  • Improving siting provisions for solar on farmland.
  • Creating carbon intensity reduction standards for transportation.
  • Facilitating the expansion of a solar plant.
  • Supporting solar projects on k-12 schools and community colleges.
  • And many other initiatives.

With Minnesota’s economy reopening and the school year quickly approaching, this program will be instrumental in providing schools equitable access to solar energy. 

What it Means for Schools 

$16 million will be available for solar projects on K-12 schools, and $5 million will be available for community college projects. In greater Minnesota, the maximum system size will be capped at 40 kW and projects in Xcel will be capped at 1 MW. The Minnesota Solar Energy Industries Association projects that the funds could support roughly 350 schools across the state, nearly tripling the current total of school installations. 

There is a focus on equity within this program as well. Within Xcel territory, 40% of the program’s funding will be directed to schools where at least 50% of students receive free or reduced lunches. This will help school districts with a large percentage of low-income students invest in solar and save on utility bills.

Saving on Utility Bills 

Installing solar panels can greatly reduce utility spending on schools, saving significantly in the long run. For example, Mounds View School District installed solar on 13 buildings, and will reduce energy costs by $2 million over the next 25 years. With solar, schools can also protect against rising electricity costs, guaranteeing electricity prices for up to 20 years. 

Hands-on STEM Opportunities  

Solar isn’t just a way to save money on energy, it also provides an opportunity to educate the next generation of energy leaders. Take ISD 197’s sustainability manager’s example, “It’s hard to encourage kids to be excited about learning about energy. This is one way that they can actually see it in action.” In fact, schools must have an educational component in order to participate. In addition to providing an opportunity to see solar in action, IPS clients are offered standards based STEM curricula and educator workshops, free of charge with the Sunrise Program.

Acting Sustainability

Switching to solar energy is one of the biggest changes we can make in our communities to curb climate change. According to the Environmental Protection Agency (EPA), generating electricity contributes over one-third of all greenhouse gas emissions in the United States. With rising concerns about our carbon footprint and the mounting cost of energy, solar is a wise investment for the health of the environment and generations to come. 

Flip the Switch on Solar for your School! 

Nearly a third of all Minnesota schools with solar have worked with IPS, and we are happy to help educate schools about the efficacy of solar energy. If you’re interested in learning more about solar, or seeing if solar is right for your school, simply request a quote, call, or reach out to info@ips-solar.com to get started. We’d be more than happy to coordinate a tour at one of our schools to see an array in person!


Helpful Links for Schools Considering Solar Energy: 

MN Clean Energy Resource Teams | Additional Omnibus Energy Bill Info | Our Schools | Standards-Based STEM Curricula

30 Years Of Solar Ep. 5: Eichten’s Hidden Acres

A shot of the ground mounted solar array installed by IPS at Eichten’s Hidden Acres.  

Growing Trust with Landowners

Eichten’s Hidden Acres is an award winning cheese and buffalo ranch in Center City, Minnesota bordering Taylors Falls on the St. Croix River. The ranch has been family owned and operated since 1976, and is committed to energy efficiency and healthy farming. In 2011, Ed Eichten, the owner of Eichten’s Hidden Acres met with Eric Pasi, the Chief Development Officer of IPS. Ed wanted to learn more about investing in solar not only with the ranch in mind, but for the benefit of future generations. 

“I’ve always been very conscious of burning fossil fuels. I’m from a large family and have a lot of nieces and nephews, so it’s for that, and it’s just for humanity. It doesn’t make sense to keep polluting the atmosphere.”  – Ed Eichten

At the time of Ed and Eric’s conversation, IPS didn’t have a large presence in rural Minnesota and large ground-mounted projects weren’t common. Thankfully, Ed’s enthusiasm for solar led to a 40 kW project that would be completed the following year, and to the start of a long and prosperous relationship with IPS.

A few years later, Minnesota’s Community Solar Program was in its infancy and IPS was searching for landowners that were interested in leasing their land for a solar garden. These gardens would allow people in the local community without ideal roof conditions or finances to benefit from solar. Since the program was brand new and there wasn’t a history of successful projects to refer to, many landowners were skeptical.   

Ed felt as though his original system had already paid for itself, and once again thought it would be a good idea; not just for his own benefit, but for his community and the environment! Ed leased a portion of his land for the solar garden to IPS and construction began. Soon after, the 5 MW project was completed, giving a home to more than 15,000 solar panels to power the ranch and its surrounding community.

Ed Eichten touring the newly commissioned IPS community solar garden shorty after construction.   

“This was the first project we did in the area so they had a lot of questions to answer and we always got the answers we needed.” – Ed Eichten

Ed’s trust in IPS and the success of his project were instrumental in establishing IPS as a trustworthy company for landowners across the state. His early commitment and subsequent solar advocacy provided solar energy access to his community and opened the doors for over 50 (and counting) solar gardens.

2021 marks a major milestone for IPS, and we’d be thrilled to have you join us in celebrating 30 years of solar. Learn more about the event RSVP here!

30 Years Of Solar Ep. 4: Thank you, Mr. Cartwright!

Michael, students, and the IPS team at the Mounds View High School ribbon cutting.  

Solar for Schools

Michael Cartwright, or Mr. Cartwright as his students know him, has been teaching physics at Mounds View High School for over 25 years. In the summer of 2014, he took a course for teachers at the University of Minnesota that focused on renewable energy and bioproducts. Michael chose to center his research during the course around the environmental and economic opportunities that solar power can provide. 

That research led to a meeting with IPS Chief Development Officer Eric Pasi to discuss options for installing solar panels on Michael’s home. During their conversation, they bonded over their mutual appreciation of Hawaii and talked about some recent rooftop projects IPS had completed with the Chisago Lakes School District. After learning about the opportunities for schools through state legislation and Xcel Energy incentive programs, it seemed to Michael that solar was a great opportunity for Mounds View, economically and educationally.

Michael met with the district’s Assistant Superintendent to discuss solar’s feasibility. It was then brought to the Superintendent and eventually the School Board. After much consideration and research, Mounds View Schools applied for three school projects in a fairly competitive field of requests. This was through the Made in Minnesota program, which used a lottery system to provide incentives to over 1,400 projects in 50 counties to stimulate the growing solar industry. Eventually, after three years of the program, 13 of the school buildings had 40 kW solar arrays operating.

Michael’s fascination with solar didn’t end there. He wanted to utilize the rooftop panels to help teach his students about renewable energy. He lent his expertise to IPS and helped us create the Sunrise Program, even taking a sabbatical from teaching in order to give the program his full attention.  

The Sunrise Program offers complete STEM programs designed to spark students’ curiosity and give them the tools they will ultimately need for success, offering schools three approaches. classroom presentations, fully developed STEM curricula and professional development – that can be mixed and matched to best serve each district. The program runs annual workshops for Minnesota educators, several of which Michael has led himself.  

IPS and the Sunrise Program wouldn’t be the same if it weren’t for Michael’s enthusiasm and drive to educate future generations about the importance of solar energy. We’re grateful for his exceptional work, and are inspired by the impact he makes on students, schools, the community, and environment every day. Thank you!

2021 marks a major milestone for IPS, and we’d be thrilled to have you join us in celebrating 30 years of solar. Learn more about the event RSVP here!

30 Years Of Solar Ep. 3: Make a Mudslide Shine

A rare IPS photo of a wind turbine.  

Make a Mudslide Shine

Impact Power Solutions is Minnesota’s leading commercial solar developer, but we haven’t always only installed solar. In the mid 2000’s, we installed several wind turbine projects across Minnesota and Western Wisconsin. Renewable wind technology was becoming more affordable and there was interest from many landowners, so it seemed like a natural fit for us.

Unfortunately, product defects caused almost all of the turbines we installed to produce much less energy than originally anticipated. Suddenly, our clients were stuck with large, poorly producing wind turbines that had become eye-sores. After it became clear that no amount of maintenance or repair would get these turbines working properly, we decided to disassemble every single one and replace them with PV solar arrays of a similar size. The new solar arrays were installed at no cost to the clients, and would meet or exceed the original estimated production of the turbines.

Chuck Allen was one of these clients. His wind turbine was installed in 2009 and it was immediately clear that it was not going to meet the original production estimates. We replaced the turbine with a 23 kW solar array, which has exceeded the original production estimates of the turbine. IPS has since narrowed its focus strictly to rooftop and community solar, but we continue to draw on our experience from these projects and the lessons we learned from them. We’re extremely grateful for the patient clients that allowed us to make this right, and we continue to try and make every mudslide shine!

2021 marks a major milestone for IPS, and we’d be thrilled to have you join us in celebrating 30 years of solar. Learn more about the event RSVP here!

30 Years Of Solar Ep. 2: Electric Elections

Footage from the installation at Highbridge Power Plant in Saint Paul, MN.  

IPS Rising to the Occasion

In 2008, with election season in full swing, Ralph got a call from an engineer friend at Xcel Energy. The Republican National Convention was scheduled to be held in Saint Paul, Minnesota – and candidates John McCain and Sarah Palin planned to visit Xcel’s nearby High Bridge Power Plant.

Xcel wanted to showcase renewable energy during the visit and asked if IPS could complete an array at the plant beforehand. The initial call was in June and the visit would be in September, which made for a tight timeline. Not shying away from the challenge, Ralph agreed to take on the project.

The system was completed with a week to spare: it was amazing to see how top security clearance could speed up a job. And the candidates each got to shake hands with our governor with the solar arrays as the backdrop.

The array is still producing, IPS still values its relationships with utilities (and both sides of the aisle), and we still get even the most challenging jobs done right and on time!

2021 marks a major milestone for IPS, and we’d be thrilled to have company join us in celebrating 30 years of solar. Learn more about the event RSVP here!

Going Beyond the Balance Sheet at the Steger Wilderness Center

What is the Steger Wilderness Center? 

Located in the boreal forests of Ely, MN, the Steger Wilderness Center is a facility designed to activate our understanding of what it means to be interdependent—with each other, with our earth and as a society. For many, the Center is a place for artisans to hone their craft for the trades-work economy of the Iron Range. Much of the Center is constructed using found or repurposed building materials, and has grown with a sustainable focus since the 1970’s.   

In January of 2020, the Center sought to improve it’s renewable energy system, which had been cobbled together with donated equipment over the years. By replacing their system’s reused parts with more efficient components, the Center hoped to take the next steps toward meeting its growing energy needs sustainably. 

Sharing a Common Goal

Will Steger assembled a group to discuss what could be done to help the Center in the short and longer term. Ralph Jacobson joined the conversation after becoming acquainted through the Summer Solstice fund-raiser event which IPS sponsored in the summer of 2019. As a result, Ralph Jacobson of IPS, Brian Allen of All Energy Solar, John Kramer of Sundial – key players in competing solar companies, would collaborate to support the wilderness center’s goal. 

Upgrading the Center’s system would be a daunting task, but that’s what drew Ralph toward this project in the first place. “We like to get solar set up in places where it’s a stretch” said Ralph, “It’s a challenging project in a difficult place to get to. The kind of place that’s a bit of an adventure.” 

The three split the equipment costs, and additionally, IPS covered the labor. An IPS electrician and his apprentice installed the new equipment and battery set, and ensured the system was fit for an electrical inspection and utility interconnection. IPS visited the wilderness center in March, replacing batteries, switches, inverters, and other components throughout the spring.

Solving Problems Sustainably 

“Thanks to the upgrades provided from IPS, we now have a reliable 24/7 off grid power that has been a game changer for the Steger Wilderness Center,” said Will. “Our woodworking shop is now carbon free and everything functions with a flick of a switch. This is goodbye to our 50 year dependence on fossil fuel generated power.”

Ralph and the team were excited to finally visit the Center and get to know Will Steger, famed arctic expedition leader and the Center’s namesake. The Steger Wilderness Center certainly lived up to its ideals by connecting competitors, allowing an apprentice to hone their skills, and solving problems sustainably. Today, the project is fit for interconnection, and ready to support the Center’s growing energy needs.

Impact Power Solutions is always available to answer questions about solar. If you’d like to find out what solar would look like for your organization, feel free to email, contact, or get a quote. 

Meyers Printing Goes Solar

 

On October 16th Meyers unveiled their new solar array at their headquarters in Minneapolis, MN in partnership with Impact Power Solutions (IPS). Since 1949, Meyers has been known for creating innovative print materials to support retail marketing. Meyers recently announced that they’re committed to obtaining all electricity from carbon-free sources by the end of 2021 to dramatically reduce carbon emissions. 

Environmental Impact

The 128-panel array will produce roughly 50 kWh per year, enough to power 5 average Minnesota homes. Over the next 30 years, the solar panel system will offset nearly 1,400 tons of CO2, equivalent to the carbon sequestered by roughly 1600 acres of trees.

System Information

  • 128 Panels
  • 48.64 kW System Size
  • 89,465 pounds of Co2 Offset Per Year
  • 57,395 kWh of electricity Generated Per Year
  • View More

“Companies are often forced to choose between doing the right thing for sustainability and offering cost-effective solutions. We realized this could be done so efficiently that it might even lower our long-term costs. As a result, our customers won’t see any price increases as we move ahead with this plan.” – Chris Dillon, President, Meyers

Why Did Meyers Choose Solar Energy?

Making the decision to move forward with a commercial solar array isn’t always an easy one, but for Meyers, the decision was made clear by scientific consensus and their initiatives for sustainability. 

“Brands and retailers are more focused on sustainability than ever before. Sustainability has become a mantra that drives consumer behavior. And, we’re proud to serve customers and partners that are similarly committed to safeguarding our collective future by heeding the scientific community’s warnings and calls to action. This means everything from using 100% post-consumer waste (PCW) materials to reducing their carbon footprint, including the carbon footprint of their entire supply chain.” – Mike Lane, CEO, Meyers

The decision to make the switch to solar allows Meyers to take another step toward sustainability, save thousands in overhead costs, and allows their stakeholders an opportunity to feel involved in making an impact on climate change.

Congratulations, Meyers!

From the project’s inception to completion, it’s been an absolute pleasure to work with our partners at Meyers. IPS is available to assist businesses and organizations in answering questions about solar energy. Interested businesses and organizations can contact us to learn more.

 

Net Metering: What is it & why does it Matter?

What is Net Metering?

Net metering allows solar system owners to send extra energy they produce into the power grid. So if the system produces more than what they use, the energy sent into the grid is credited. Basically meaning their electric meter runs in reverse. 

 

But Don’t be Fooled.

The promise of earning additional income from the practice is nearly a myth. While it provides FANTASTIC credits & savings to your bill, your system usually won’t produce more than you use.

 

Why is it Important?

  • Firstly, it allows you to save more on utility bills with clean energy.
  • Secondly, it increases the amount of energy that the utility grid receives from renewable sources. 
  • Thirdly, it protects the power grid, allowing utilities to better manage peak loads.
  • Lastly, it increases clean energy demand, creating jobs. 

 

A Brief History of Net Metering

Beginning in the late ’70s, Steven Strong installed 2 solar systems, but he forgot to tell the utility company that his system fed excess power into the power grid.

Fortunately, it all worked, and as a result, several officials from the state and utility company were invited to the grand opening of the projects. As a result of hearing the state officials applaud Strong’s innovation, the utility company ultimately shared their praise. 

After a very positive PR response, clean energy companies across the US adopted the practice. Later on, Strong won several awards from federal agencies and was dubbed “Hero of the Planet” by Time Magazine. 

 

US States/territories with Net Metering Laws

In our home state of Minnesota, clients are only billed for their net usage. When excess energy is generated during the day, the utility company has to pay the market rate when crediting their bill.

Source: (Solar Power World, dsireusa.org)

 

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  • Alaska
  • American Samoa
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  • Massachusetts
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Impact Power Solutions is happy to provide solar development services in Minnesota and across the Midwest. If you’re ready to start saving with solar, feel free to contact us or get a quote.  Being the #1 solar developer in the Midwest, our process has constantly improved for over 25 years to meet your needs.