Salamanca Board of Public Utilities

Salamanca Board of Public Utilities Residential Electric Bill

There are two charges that combined equal the total electric charges on the monthly utility invoices.  Each electric service’s usage is billed based on kilowatt-hour “kWh” consumption.  The first charge listed on monthly invoices is the ELECTRIC charge.  The second charge is listed on the utility invoice as PPA (Purchased Power Adjustment).  Electric rates charged by the BPU to our customers are approved and regulated by the New York State Public Service Commission.  The last electric rate increase was in 2004.    

ELECTRIC Charge:  Each and every residential electric customer is charged a Service Charge of $2.08 per month regardless of the amount of kWh used on a monthly basis.  In addition, each residential electric customer is charged a set amount for each kWh of electricity used.  For residential electric customers the BPU currently charges $0.0249 (2.49 cents) per kWh of electricity used in any given month.  As an example, the ELECTRIC charge for a residential customer using 490 kWh of electric in a month would be as follows:  Service Charge of $2.08 plus kWh charge ($0.0249 x 490kWh) of $12.20.  The total ELECTRIC Charge for 490kWh of electric would be $14.28.  This portion of your electric bill is used to pay for the Board of Public Utilities cost of operation.  This charge pays to purchase wire, transformers, poles, vehicle purchases, fuel etc.  The ELECTRIC charge also pays for all employee costs.

PPA Charge:  The Purchase Power Adjustment charge fluctuates monthly.  The PPA charge is the total dollar cost to purchase electricity for all Board of Public Utilities customers divided by the total kWh’s purchased by the Board of Public Utilities.  The PPA charges include the cost to both purchase and transmit electric to the BPU’s electric system.  Each electric customer pays a PPA charge every month.  PPA charges have been on all electric utility bills since December of 1979.

Where does the BPU purchase your electric from:  The Board of Public Utilities purchases the electric we provide to our customers from two separate sources.  The New York Power Authority “NYPA” provides a monthly allotment of hydroelectric power.   The electric provided by NYPA is primarily generated at the Niagara Power Project near Niagara Falls.  The electric purchased from NYPA is extremely low cost compared to other sources of electric.  For more information regarding NYPA visit their web site at www.nypa.gov.  Once the BPU exceeds our monthly allotment of electric from NYPA we have to purchase the remainder of our electric needs from the New York Municipal Power Agency “NYMPA”.  NYMPA supplies all our  electric needs not supplied by NYPA.  NYMPA purchases power generated from coal, gas, and other more expensive generation sources.  For more information regarding NYMPA visit their web site at www.nympa.org.  In addition to purchasing electric, the Board of Public Utilities is charged by National Grid to transmit the energy purchased for our customers use from its source to Salamanca.  All the above costs are what make up your monthly PPA charges shown on your electric invoice.

Why do PPA costs vary month to month:  In 2011 the PPA charges have ranged for a low of $0.007796 (less than 1 cent) per kWh to a high of $0.033716 (more than 3 cents) per kWh.   A majority of BPU residential electric customers heat at least a portion of their homes with some type of electric resistance heating.  Due to this large electric heating load, the BPU purchases almost twice as much electric during the colder winter months than we purchase during the summer months.   As mentioned earlier, the BPU is allotted a set amount of low cost hydroelectric power purchased thru NYPA.  Once the BPU’s customers exceed the monthly allotment of low cost power, we have no alternative but to purchase more costly electric thru NYMPA.  The higher PPA charges in the winter months reflect the BPU’s need to purchase more expensive power thru NYMPA.

Seneca Allegany Casino purchases of electric:  The Seneca Allegany Casino purchases all their electric from the Salamanca Board of Public Utilities.  There have been persistent rumors that purchases of electric by the Seneca Allegany Casino have caused electric rates to rise for all Board of Public Utilities’ Customers.  This rumor is false.  As mentioned above, the Board of Pubic Utilities purchases low cost hydroelectric from the New York Power Authority and higher cost electric from the New York Municipal Power Agency.  Once our customers exceed our monthly allotment of low cost hydroelectric, we purchase the remainder of our customers electric needs from NYMPA each and every month.  When electric utility invoices are calculated each and every month, the invoice for the electric consumption at the Seneca Allegany Casino is calculated using the highest cost of energy purchased by the Board of Public Utilities.  In essence, the Seneca Allegany Casino purchases all their energy requirements at the highest cost of electric purchased by the Salamanca Board of Public Utilities.  This method of calculating the electric utility invoices for the Seneca Allegany Casino allows all other Board of Public Utilities electric rate payers to enjoy the lowest possible electric rates.

Cost of Electric to residential customers:  The highest electric charge ever for Board of Public Utilities residential electric customers occurred with utility invoices our customers received in March of 2009.  At that time the total cost of residential electric service was slightly less than 6 cents ($0.06) per kilowatt-hour of electric purchased from the Salamanca Board of Public Utilities.  The lowest cost of electric purchased from the Board of Public Utilities in 2011 occurred with utility invoices our customers received in July.  At that time the total cost of residential electric service was slightly more than 3 cents ($0.03) per kilowatt-hour of electric purchased from the Board of Public Utilities.  The highest cost of electric purchased from the Board of Public Utilities in 2011 occurred with utility invoices our customers received in February.  At that time the total cost of electric purchased from the Board of Public Utilities was less than March of 2009’s costs.  Listed below is the cost of a monthly residential electric utility invoice for a customer of National Grid as listed in the New York State Public Service Commission Web Site (January 2011).

National Grid Residential