Rates & Fees
While every effort is made to keep the rates accurate, this is not an authoritative source of rate information. Residents are advised to call the Utility Business Office at 419-354-6252 if you have any questions.
Electric Rates 101
Public power utilities are operated by local governments to provide communities with reliable, responsive, not-for-profit electric service. Public power utilities are directly accountable to the people they serve through local elected or appointed officials. Municipal systems have a diversified power mix, purchasing power on the wholesale market, as well as generating electricity from coal, hydro, solar, wind, landfill gas, and other renewable, natural gas, diesel, and distributed resources.
Municipal electric systems are held to public accountability standards. Public records, open meetings, competitive bidding, public budget hearings and prevailing wage laws are just a few of the public accountability standards unique to most municipal electric suppliers.
There are two other types of electric utilities: investor-owned utilities (IOUs) and rural electric cooperatives (co-ops). Most retail electric customers in the nation (68 percent) are served by IOUs, which are private stockholder-owned, for-profit companies. About 13 percent of electric customers are served by consumer-owned electric cooperatives.
Bowling Green is one of more than 2,000 community-owned electric utilities, serving over 49 million people or about 15 percent of the nation’s electricity consumers.
The City of Bowling Green’s Charter and Municipal Code provides that the department of public utilities is responsible for the management and operation of city-owned public utilities and, in accordance with the provisions of general law, are governed by a board appointed for such purpose.
Historically, the Board of Public Utilities has utilized professional consultants to recommend rate designs based on their independent analysis of the utilities’ actual expenses and revenue requirements. The Utilities Department provides the current and historic data for this analysis and future rate projections including State of Ohio Audit reports. The resulting report, known as a “Cost of Service” study, is submitted to the Board of Public Utilities for their review and consideration.
“Cost of Service” is a method to equitably allocate the revenue requirements of the utility among the various customer classes of service.
There are two main objectives of a cost of service study:
- Ensure rates recover costs to provide service to customers (Revenue Requirements)
- Defines optimal rate structure (customer charge, kWh charge and demand charge)
Cost of service studies are typically performed every 3-5 years or when there is a significant change in operations or capital improvement.
For Electric service, traditional rate design includes a fixed monthly customer charge, an energy charge per kilowatt-hour sold for residential customers, and a demand charge for larger commercial and industrial customers.