What is energy demand?
In the later part of 2017, Yellowstone Valley Electric Cooperative (YVEC) began showing the Energy Demand amount on all electric bills. Historically, we've only billed demand on three-phase services such as irrigation and commercial accounts. Illustrating the demand on residential and other single-phase services is an opportunity to show the member their true use of the electrical system. At this point, the demand charge for residential services is captured in the kilowatt-hour rate and no demand charge is needed. The associated charge for demand on single-phase and residential services is thus, $0.
It is important, however, to understand how electricity is made and delivered to your home. Before YVEC can send electricity to your home, that power needs to be generated by a Generation and Transmission Cooperative (G&T). In our particular case, the G&T is Basin Electric Cooperative, which has generating assets in Montana, North Dakota, and Wyoming locally. Once the electricity has been generated, it travels over high-voltage transmission lines to substations, where the voltage is reduced to a safer level for distribution. The electricity then travels over distribution power lines and finds its way into your home. So, while you pay your bill to us - your electric distribution cooperative -we don't actually generate the power you use. That is the job of the G&T.
We do help determine how much electricity our members need to power their homes and businesses, and you play a big part in determining how much electricity the G&T needs to create in order to keep the lights on in our communities. That is where the terms "consumption" and "demand" come in.
Consumption is measured in kilowatt-hours (KWh). Demand is measured in kilowatts (KW). A lightbulb "consumes" a certain amount of watts, let's say 100 watts per hour. If that lightbulb stays on for 10 hours, it "demands" a certain number of kilowatts (in this case, 1 KW) from the generation station producing electricity. Now, if you tum on 10, 100-watt lightbulbs in your home for one hour, you are still consuming the same number of KWh's. However, you are placing a demand on the utility to have those KWh's available to you over the course of one hour, instead of ten. This requires the G&T plant to produce more power in less time, in order to meet your demand.
YVEC purchases power from Basin Electric based on those same principles, consumption, or KWh's and demand or KW. Our power bill from Basin consists of charges for both and typically the demand makes up about 60% of the bill. The point in time when the demand for electricity is the highest during the month is called the peak. Peak demand varies month by month. YVEC's highest peak demand for 2021 occurred in July and was 85,249 KW. The KWh's also vary each month. Our sales may be as low as 18M KWh's in a low sales month and over 35M KWh's in a high sales month.
At Yellowstone Valley Electric Cooperative, we do not have "time of use" rates. In other words, you are not penalized for using power at certain times of the day, especially during the peak period. Our rates stay the same around the clock. In fact, our rates have not changed since May, 2011. That's over 10 years without a rate increase!! Generating and distributing power can be a tricky business, but YVEC will always meet the necessary requirements to provide safe, reliable, and affordable power.
Brandon J. Wittman
CEO / General Manager