Power Supply Charge

Please browse the frequently asked questions below.

What is the monthly Power Supply Charge?
The Power Supply Charge recovers the cost of the electricity we buy from various electric power providers on behalf of our customers. The biggest part of the Power Supply Charge covers the cost of fuels (primarily natural gas) that we buy for use at power plants on Long Island owned by National Grid to produce electricity as part of Long Islandís overall electric supply. The Power Supply Charge also includes the cost of power purchased by us from Independent Power Producers both on and off Long Island.

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Why does LIPA change the Power Supply Charge every month?
Like all electric utilities, LIPAís fuel and electricity costs are affected by daily fluctuations in market energy prices. LIPA summarizes these daily changes in energy prices into a monthly Power Supply Charge that reflects the cost of purchasing electricity as closely as possible to our customerís monthly usage.

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Is an increase or decrease in the monthly Power Supply Charge a permanent change?
No. The monthly charge will vary according to what it actually costs to purchase the electricity our customers use for the month. Market prices, weather, and other factors all contribute to month to month variations in what it costs to purchase electricity for a particular month. This means there will be months or periods when the Power Supply Charge increases and other times when it decreases.

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What factors drive changes in the Power Supply Charge?
The single biggest driver of the month-to-month changes in the Power Supply Charge is the price of natural gas. Almost all of the electricity that LIPA purchases under long term contract or in the spot markets is priced at the cost of natural gas. The second biggest driver is the balancing credit or surcharge based on actual customer usage and the associated actual cost of the electricity LIPA purchased to meet that demand. This element of the Power Supply Charge ensures that customers will only pay for the actual costs LIPA incurs.

Interestingly, two factors that do not contribute to the monthly fluctuations in the Power Supply Charge are the cost of fuel oil and the cost of renewable energy. So little of LIPAís electricity comes from power plants burning fuel oil that changes to the price of petroleum have almost no impact on LIPAís costs. Changes in the price you pay at the pump have little to do with the price you pay to LIPA, either upward or downward. In addition, the electricity that LIPA purchases from renewable resources, and solar power in particular, stabilize the Power Supply Charge because the output from resources like solar panels is purchased by LIPA at a fixed rate per kWh.

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How does the monthly pricing of the Power Supply Charge benefit me?
Monthly pricing of the Power Supply Charge allows you to see the cost of electricity as you use it. And youíll be better able to plan and adjust how you use electricity based on its price. For example, if energy prices rise, youíll be in a better position to respond to it by taking steps to lower your electric usage through energy efficiency opportunities.

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How can I manage my monthly costs?
There are many ways for you to directly affect the amount of your bill beginning with using electricity more efficiently. Itís that simple and itís easy to do. From changing the type of light bulbs you use, to upgrading your air conditioning, you have a lot of control. We are here to help you save energy and money and we offer rebates on a variety of energy efficiency improvements that can lower your bill. Visit us at www.lipower.org/efficiency for more information about ways to lower your energy usage and save money.

We also offer Balanced Billing, which evens out the seasonal ups and downs in your costs to give you a stable bill throughout the year. It makes your electric bill predictable, like the rent or mortgage payment, to help you better manage all your expenses.

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Recent Power Supply Charges
  Month Ę/kWh  
  Aug 1, 2016  8.3484  
  Jul 1, 2016  7.0480  
  Jun 1, 2016  6.9660  
  May 1, 2016  6.2559  
  Apr 1, 2016  6.2196  
  Mar 1, 2016 6.1329  
  Feb 1, 2016  6.2937  
  Jan 1, 2016  5.2720  
  Dec 1, 2015  8.6039  
  Nov 1, 2015  8.4052  
  Oct 1, 2015  8.3799  
  Sept 1, 2015    7.6446  
  Aug 1, 2015 6.7758  

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