Rate increase for ComEd customers takes effect this month

Many Chicagoland residents will see an increase in their utility bill this month.

ComEd, the primary electric utility in Chicagoland and the largest in Illinois, increased rates beginning June 1 because of what’s called a “capacity charge.”

The average monthly residential customer is expected to see an increase of about $10.60 to their bill, according to a ComEd spokesperson last month.

ComEd says the “capacity charge” is included as a portion of all customers’ monthly bills, either as a separate line item for hourly pricing participants or within the electricity supply charge for default fixed-price-rate customers.

The “capacity charge” changes every June based on a customer’s energy usage from the previous summer.

What is a ‘capacity charge?’

Electric utility companies pay “capacity charges,” a supply cost that goes toward power for your use both now and in the future.

According to ComEd, this ensures there will be enough capacity “when you need it.” The “capacity charge” is determined by ComEd’s supplier and is “passed directly to customers by ComEd with no mark-up,” a spokesman for the utility said.

The reasons for the “capacity charge” increase are numerous, and the “why” is a fairly complicated question in this case.

But essentially, it’s Economics 101: Supply and demand. If demand goes up faster than supply, you get a rate increase.

Evidently, supply is down, and demand gets very high during the summer, when people run their air conditioners.

“Energy prices are driven by supply and demand,” ComEd says on its website. “Large power generators sell this electricity supply to ComEd, and we pass this cost directly to you.”

Whatever the reasons, what matters to ComEd customers is that their rates will go up this month.

How do I calculate my ‘capacity charge?’

The math is simple.

ComEd customers should be able to calculate their specific “capacity charge” using numbers readily available on their monthly bill. According to ComEd, you just multiple your “capacity obligation” with your “capacity charge rate” to get your “capacity charge.”

The “capacity obligation” is specific to each customer and represents expected energy usage during high-demand hours on hot summer afternoons. The “capacity charge rate” is based on the cost of capacity, as determined by electricity market conditions.

ComEd says the new “capacity charge rate” will be on your bill starting in June.

So, find the “capacity charge rate” number and the “capacity obligation” number on your bill and multiply them, and you’ll get your “capacity charge.”

Click HERE for more information on the ComEd rate increase.