Southern Maryland Electric Cooperative (SMECO) received approval from the Maryland Public Service Commission (PSC) to adjust its energy charges on January 26, 2022. New Standard Offer Service (SOS) rates will go into effect with February 2022 bills. 

SMECO’s residential SOS rate is made up of the energy charge and the Power Cost Adjustment (PCA). SMECO has adjusted the residential winter energy charge from 6.56 cents per kilowatt-hour (kWh) to 8.33 cents per kWh. A residential bill issued in February for 1,000 kWh will be about $15 higher than a bill issued in January of about $141 for 1,000 kWh. The summer energy rate will increase from 6.11 cents per kWh to 7.8 cents per kWh.

Since people have been commuting to work and traveling again, energy use is rising and increased demand has resulted in higher prices for fossil fuels. In addition, SMECO’s transmission costs have increased.

“Higher costs for oil and natural gas, which are the fuels used by electric generating plants, have spurred increases in wholesale energy costs since last fall,” explained Sonja M. Cox, SMECO president, and CEO. She added, “The co-op does not make a profit on SOS energy charges. We work to keep our rates as low as possible by using a portfolio approach to purchasing power, with contracts for baseload and peak load, structured as long-term and short-term contracts. Because of previous rate reductions, SMECO’s new adjusted rates will be similar to where they were in 2017.”

A decrease in the PCA will help to offset the increase in the energy charge. The PCA decreased from 0.9222 cents per kWh in January to 0.6622 cents per kWh in February. According to Cox, “SMECO’s PCA adjusts monthly to reduce the impact of market fluctuations on the cost of energy to members. When the PCA is more than five percent of the energy charge for three months in a row, the energy charge is adjusted.”

The cold weather in January will have an effect on most bills because the use of heating systems has increased. For members who want to reduce their bill, the most effective way to save is to reduce energy use. For tips on how to save, go to smeco.coop/ways-to-save.

Monthly bills fluctuate because energy use usually goes up in summer and winter and down in spring and fall. To reduce the impact of these variations, budget billing allows customers to pay the same amount each month. Residential customers can sign up for SMECO’s budget billing plan by going to smeco.coop/AccountManager.

Residential customers who need financial assistance to pay their SMECO bill may apply at Maryland’s Department of Human Services through the Office of Home Energy Programs (OHEP). Apply online at www.dhs.maryland.gov/energy or call 1-800-332-6347. If customers need an extension on paying their bill, they may also contact SMECO at 1-888-440-3311 or log in to Account Manager and click on the “payment arrangements” link.


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