How to read my electric bill

UES' electric rates reflect the cost of providing safe, reliable service to our customers. They also reflect the complexity of that task, with fixed fees, usage-based charges and surcharges that can be difficult to understand. The following summary offers explanations for the terms you'll find on your monthly bill, including links to details posted elsewhere on this website.


Delivery Services

UES Bill Sample 1The charges listed in this section of your bill recover the cost of delivering power to customers. These charges reflect the cost of poles, wires, transformers and other infrastructure; employees and contractors who install, operate and maintain that equipment; and other necessary business expenses.

The Arizona Corporation Commission (ACC) sets rates that divide responsibility for these costs among different types of customers — residential, small business, large business and industrial — based on their typical energy usage patterns. UES' rates are designed to recover the appropriate portion of these costs from each customer group through a combination of fixed fees and usage-based charges.

Basic Service Charge

This fixed monthly fee helps cover the cost of maintaining electric service to your address. This fee does not vary with usage. The charge covers only a small fraction of the costs UES incurs to serve every customer, regardless of how much energy they use.

kWh charges

Electric usage is measured in kilowatt-hours (kWh) — the use of one kilowatt of electric power for one hour. UES' rates include separate kWh charges for energy delivery and power supply costs.

The kWh charges for delivery services vary based on several factors.

UES’ residential rates include two tiers: 0-400 kWh and over 400 kWh. The kWh charge is lower for usage in the first tier.

Customers who have signed up for a time-of-use (TOU) rate pay different kWh charges at different times of the day. Charges are higher "on peak" — during periods of high electric usage — and lower "off peak."

TOU rates also are higher in the "summer" — defined as May through October — than during the rest of the year — which, for simplicity's sake, is called "winter." The difference is due to the higher cost of serving customers during peak usage periods. Because your bill reflects usage from 30-day periods that often include parts of two months, some TOU bills include kWh charges calculated at both summer and winter rates.

KBH

This unit — equivalent to a kilowatt hour (kWh) — is used to measure the amount of excess energy generated by a customer's solar array or other distributed generation system. Unused output from such systems flows into UES' local systems through a net meter, generating KBH credits that offset equivalent kWh charges for the energy UES provides.

Demand Charge

A charge based on a customer's peak energy use during the previous billing period, as measured in kilowatts (kW). Demand charges reflect the costs of generation, transmission and distribution. For residential customers, demand charges are based on highest hourly energy use during on-peak periods.

TCA

The Transmission Cost Adjustor (TCA) is a monthly charge or credit that allows UES to recover a portion of transmission costs associated with serving retail electric customers. The TCA was first applied to bills in June 2014 and is reset annually to reflect updated cost calculations. This rate adjustment is based on UES’ investment in its transmission system and is calculated using a formula approved by the Federal Energy Regulatory Commission (FERC).

Acquisition Credit

This temporary credit is applied to the Customer Charge on bills issued from October through March. The savings range from $1.15 per month for residential customers to more than $143 per month for the largest commercial and industrial customers. The credit provides customers with direct benefits from the August 2014 acquisition of UES' parent company by Fortis.

Power Supply Charges

 

UES Bill Sample 2This section of your bill includes usage-based charges to cover the cost of generating or buying energy for customers.

kWh charges

All power supply costs are recovered through usage-based fees measured in kilowatt-hours (kWh) — the use of one kilowatt (kW) of electric power for one hour.

Customers who have signed up for a time of use (TOU) rate pay different power supply kWh charges at different times of the day. Charges are higher "on peak" — during periods of high electric usage — and lower "off peak."

Power supply kWh charges also are higher during the "summer" — from May through October — than during the rest of the year, which is referred to as "winter." The higher summer rate reflects increased energy costs during that period. Because bills often reflect usage from parts of two months, some bills include kWh charges calculated at both summer and winter rates.

PPFAC

The Purchased Power and Fuel Adjustment Charge (PPFAC) is a usage-based charge or credit that reflects changes in energy costs that aren't covered by the kWh charges for power supply. The PPFAC typically is adjusted annually to reflect recent and projected power costs as well as other factors. The PPFAC does not include any profit — it simply passes along UES' costs.

Solar Block(s)

Customers who participate in the Bright Arizona Community Solar Program will see a charge in this section of their bill for the “blocks” of solar energy they’ve agreed to purchase. These blocks are billed at a fixed rate that replaces the PPFAC and power supply kWh charges for that usage. Any usage that exceeds the amount covered by the customer’s solar block will be subject to standard power supply charges. Any unused blocks will be carried over and applied to future bills.

Green Energy Charges

 

UES Bill Sample 3UES is using more renewable power and helping customers save energy. Some of the costs associated with these efforts are recovered through usage-based surcharges approved by the ACC and listed in this section of your bill.

Renewable Energy Standard Tariff

The REST surcharge helps UES build solar arrays, purchase power from renewable power systems and take other steps to comply with Arizona's Renewable Energy Standard. This rule requires utilities to increase their use of renewable energy each year until it represents 15 percent of their energy in 2025.

DSM Surcharge

The Demand Side Management (DSM) surcharge funds energy efficiency programs that are designed to help TEP comply with Arizona’s Energy Efficiency Standard. This rule calls on electric utilities to increase the kWh savings realized through customer-funded energy efficiency programs each year until the cumulative reduction in usage reaches 22 percent by 2020.

LFCR EE, LFCR DG

These Lost Fixed Cost Recovery (LFCR) charges partly offset the revenue UES loses when customers reduce their bills through energy efficiency (EE) programs and the use of distributed generation (DG) systems, including rooftop solar arrays.

Taxes and Assessments

 

UES Bill Sample 4The charges on your bill are subject to government taxes and fees. UES forwards all of the money collected from these charges to the appropriate authorities.

ACC Assessment

This usage-based charge helps fund the Arizona Corporation Commission (ACC), a state government agency led by a five-member panel of elected commissioners who set UES' rates and oversee many aspects of utility operations.

RUCO Assessment

This usage-based charge is applied to the bills of residential customers to help fund the Residential Utility Consumer Office (RUCO), a state agency that represents the interests of residential customers in rate requests and other utility issues addressed by the ACC.

City Franchise Fee

UES has reached formal franchise agreements with the cities of Bullhead City, Kingman, Lake Havasu City and Nogales that authorize its use of public rights-of-way and address other aspects of electric operations. These agreements, which were approved by voters in these cities, also mandate franchise fees that are added to the bills of customers in those municipalities. All proceeds of those fees are forwarded to the respective city governments.

Municipal Sales Tax

UES electric rates are subject to Arizona state sales tax of 5.6 percent as well as any municipal sales tax levied by the city where the customer's address is located as shown in the following table:

Bullhead City 2 percent
Kingman 2.5 percent
Lake Havasu 2 percent
Nogales 2 percent

All sales tax proceeds are forwarded to the respective taxing jurisdiction.

County Sales Tax

These sales taxes were approved by voters and are added to the bills of electric customers in each respective county as shown in the following table.

Mohave County 0.25 percent
Santa Cruz County 1 percent

All sales tax proceeds are forwarded to the respective taxing jurisdiction.

Acquisition Credits

Under terms of Fortis' August 2014 acquisition of UNS Energy Corporation, customers of UES and sister company Tucson Electric Power will receive bill credits totaling $30 million over five years.

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PPFAC

The Purchased Power and Fuel Adjustment Charge, or PPFAC, is a usage-based charge that reflects changes in the costs UES incurs to fuel its power plants and purchase energy for electric customers.

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DSM Surcharge

The Demand Side Management, or DSM, charge is a monthly, usage-based charge established by the Arizona Corporation Commission to pay for cost-effective energy efficiency programs.

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TCA

The Transmission Cost Adjustor, or TCA, is a monthly charge or credit that allows UES to recover a portion of transmission costs associated with serving retail electric customers. The TCA was first applied to bills in June 2014 and is reset annually to reflect updated cost calculations.

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LFCR Charge

The Lost Fixed Cost Recovery, or LFCR, surcharge helps ensure that energy efficiency and renewable power projects don't compromise UES' ability to maintain safe, reliable service. Natural gas and electric customers pay separate LFCR charges.

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REST

The Renewable Energy Standard Tariff, or REST, funds UES' investments in renewable energy.

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