The rates & tariffs will define how much you pay with your National Grid account monthly. These rates & tariffs vary regularly, and their value can be verified on the National Grid official website, and/or on New York State's Public Service Commission website. Here we show these charges, and make bill estimations for typical users.
Typical Rates & Tariffs
This is not systematically the case, but usually rates and tariffs are defined in the following manner:
- Rates: rates are charges paid to the utility company, National Grid. "Rates" nevertheless is often used with a more general definition: the price you pay per kWh for a given charge (so, not specific to the utility company).
- Tariffs: tariffs are charges billed by the state or municipality. They include the sales taxes as well as all the local and surcharges for the various incentive schemes put in place by the state (renewable energy, education, grid management, etc.).
Service Classification SC1
There are different types of customers: residential, commercial, industrial. Each will be assigned to different types of service classifications. These Service Classifications might also depend on the different types of usages (time of use plans for example). The vast majority of residential customers are by default assigned to the SC1 service classification. Therefore we hae used the SC1 rates & tariffs in this example to make typical bill estimations.
Bill Estimation per House Size
Your electricity consumption will vary depending on your home size, and the number of people living there. Here we have made estimations on your monthly usage for various home sizes, and calculated your monthly bill.
|Number people in the house||Monthly electricity consumption of the house (kWh) (EIA - 2009 data)||Monthly bill ($) (January 2015 data)|
|6 or more||1044||160|
|New York State average||548||92|
Bill for a typical 548 kWh usage
Your bill will be approximately 92$/month with National Grid, based on the New York State average electricity usage per month of 548 kWh.
Compared to other utilities in New York State, National Grid is the cheapest electricity utility company.
|Utility Company||Bill estimation for 548 kWh/month average NY usage|
|Orange & Rockland||147|
|PSEG Long Island||134|
Detailed explanation of each charge
In the state of NY, the average electricity usage per house is around 548 kWh. Here we tried to give an accurate estimation of the rates & tariffs you would be subjected to in your bill with a National Grid account:
|Rate||Pro rata price ($/kWh) (based on Jan 2015 data)||Total price for 548 kWh typical usage ($)|
|Basic service charge||-||17|
|Delivery service charge||0.04611||25.27|
|Revenue decoupling mechanism||-0.00124||-0.68|
|Transmission revenue adjustment||-0.00306||-1.68|
|Legacy transition charge||-0.00176||-0.96|
|Reliability support services||0.00132||0.72|
|Delivery tariffs (state surcharges)|
|Temporary state assessment surcharge||0.00026||0.14|
|System benefits charge||0.004577||2.51|
|Renewable portfolio standard||0.003318||1.82|
|Total electric delivery charge||46.73|
|Market price charge (January, 2014 value)||0.0813||44.55|
|Merchant function charge||0.00067||0.37|
|Electricity supply reconciliation mechanism||-0.0041||-2.24|
|Supply tariffs (state surcharges)|
|Total electric supply charge||45.66|
|Total electric charge||92.39|
Distribution of rates & tariffs for delivery and supply
For the typical charges just described in the table above, here is a donut chart of the distribution of the utility rates and tariffs (for the delivery and supply portions of the bill).
Description of Rates
Rates: rates are set by the utility company, in this case National Grid (they must then be approved by the Public Service Commission of New York). The utility company charges you on one hand for the delivery, and on the other hand the supply of electricity if you haven't chosen an alternate electricity supplier (also called ESCO), as well as the related adjustment charges. Rates are divided firstly between electric rates and gas rates. Then, they are separated between delivery rates and supply rates.
Delivery rates are what the utility company charges you for the transmission and distribution of the electricity or gas from the source of the power generation to your home.
- Basic Service Charge: this a constant payment made each month to your utility company. It is always the same, no matter how much electricity you use. This pays for fixed costs such as maintenance, sending a technician to read your meter on a regular basis, and other monthly activities which must be done regardless of your consumption.
- Delivery Service Charge: this charge is $/kWh, it is proportional to how much electricity you have used. Pays for delivering the electricity from the point of production to your residence.
- Revenue Decoupling Mechanism (RDM): National Grid and most other New York State electricity & gas utilities make yearly previsions on the revenues from the delivery service. If the targets for these delivery revenues are reached, the extra is refunded to the customer, and if the targets are not reached, the default is billed from the customers.
- Transmission Revenue Adjustment: This charge will bill or refund you the difference between the forecasted and the actual transmission service revenue.
- Legacy Transition Charge: This charge will bill or refund you the cost or benefit of long-term electricity supply contracts that National Grid signed prior to June 1, 2001. It also includes the benefit of low cost hydropower and a Residential Consumer Discount payment, both from the New York Power Authority (NYPA).
- Reliability Support Services (RSS): this charge pays for some power plants to be available in case there is an urgent need to avoid transmission congestion.
Supply rates are the charges per kWh which pay for the price of the actual electricity or gas you use in your home.
- Market Price Supply Charge: This charge pays for the purchase of the electricity from the power producers. It is the price at which the electricity is offered on the market. In this case we have taken an average prediction over the Niagara Mohawk service territory for the month of january 2015.
- Merchant Function Charges (MFC): this is a charge for National Grid's cost to procure the electricity (paying for the employees who buy the electricity at the best price for example). National Grid will not bill you this charge either if you choose an alternate supplier.
- Electricity supply reconciliation mechanism: This charge balances revenues from electricity supply and the market price of electricity purchased by the National Grid. Costs which are higher than the revenues mean that the customer will pay a charge, and costs which are lower than the revenues will be paid to the customer.
For more information on the rates & tariffs that appear on your bill, and how to understand them, read our page Understanding your bill with National Grid.
Description of Tariffs
Tariffs: tariffs are state mandated. They are what the state charges you. The Public Service Commission (PSC) has utility tariffs for Electric, Gas, Water, and Telecommunication companies doing business in New York State. Tariffs can also be called State Surcharges, since they are charged by the state on top of what you pay to the utility company. They include the sales tax and the gross revenue tax, as well as charges which pay programs such as energy efficiency, renewable energy incentives, and other funds.
- New York State Assessment (NYSA): also called the Temporary State Assessment Surcharge (TSAS), this is a state-mandated charge which pays for the requirements in Section 18-a of the Public Service Law: energy conservation and utility service conservation.
- System Benefits Charge (SBC): incentivizes energy efficiency.
- Renewable Portfolio Standard (RPS): this tariff incentivizes renewable energy goals set by the state of New York.
More information on Tariffs/State Surcharges on the following page: New York State Surcharges.