What is the Peak Capacity Charge on my CPS Energy summer bill?

With summer underway and higher temperatures, you can do your part to keep your utility costs low through conservation and one of the many programs we have in place.  Like utilities nationwide, CPS Energy sees energy use and customer bills increase every summer. Why? The primary reason is that with hotter temperatures, homes rely more on air conditioners to keep cool during the warmest time of the day, better known as peak hours. In response to higher demand, CPS Energy must produce more energy by running plants that are more expensive. To do that, CPS Energy uses a pricing tool called the peak capacity charge. This pricing encourages customers to conserve their energy use during the summer months when prices are high. 

“The peak capacity charge helps cover the costs to produce more energy and is a tool we use to encourage customers to reduce their energy use during the summer when it’s more costly to produce power,” said CPS Energy’s Senior Manager of Strategic Pricing and Cost Recovery Madison Bernal.

So how does the peak capacity charge work?

The peak capacity charge is not new. The fee was introduced over 30 years ago with the arrival of air conditioning as a way to encourage customers to conserve energy and recover the additional costs CPS Energy incurs during hot summer months when customers are cooling their homes during peak hours. For this reason, the cost only gets charged in the summer months of June through September—when the community’s energy needs soar. 

“This (peak capacity) charge encourages customers to conserve more when the summer demand peaks across the city and the state. It also supports San Antonio’s grid to be more reliable,” says CPS Energy’s Director of Strategic Pricing and Cost Recovery, Rick Luna.

According to the most recent CPS Energy forecasts, residential customers are expected to use about 860 kWhs per month for the non-summer months while their summer usage is expected to be higher at around 1400 kWhs per month. CPS Energy’s current charge for residential electric customers is 7.188 cents per kilowatt-hour (kWh) year-round. During the summer, an additional charge of 2.06 cents is applied to every additional kWh used over 600 kWh.    

So, customers should expect the peak capacity charge to apply to the remaining ~800 kWhs (1400 kWh– 600 kWh) on their summer bills if they do not take measures to conserve energy.

So, what can you do?

To reduce the peak capacity charge on your CPS Energy bill, we recommend making adjustments to conserve, such as keeping your thermostat at 78 F and/or participating in one or more of our many conservation programs listed below.

Take advantage of CPS Energy’s tips to conserve energy and lower your summer bills.

There are many ways CPS Energy empowers the community to conserve, manage energy and support the grid for the summer. Below are some free programs and smart tech to save.

• The Sustainable Tomorrow Energy Plan (STEP) – Offers energy savings programs and rebates, like insulation and HVAC tune-ups, to help residential and business customers save energy and money, as well as reduce the overall demand for energy in our community.
• Apply for our Casa Verde weatherization program, funded through STEP, which saves qualifying customers approximately $500 per year.
• WiFi Thermostat Rewards Program – Another energy conservation program, funded by STEP, offers smart thermostat rebates and an annual bill credit. A WiFi enabled smart thermostat allows customers to manage their HVAC from their thermostat app and use the “set it and forget it” approach to managing central air conditioning. Those that join set up the times and days in advance for when the air conditioning system runs. CPS Energy will adjust the thermostat when conservation calls occur. Customers are always in control and can make thermostat adjustments at any time.
• My Energy Portal – Customers can view the energy they buy at any time during the month and see how changes in the weather impact their energy use. This dashboard also offers free online home energy assessments.
• Signing up for CPS Energy Billing and Payment Alerts can help eliminate the surprise of an unexpected bill amount at the end of the month.
• Adopt Beat the Heat – This color-coded daily conservation alert system provides steps to lower energy use and grow bill savings.

Knowing how to manage energy at home means that every kilowatt-hour you conserve is a kilowatt-hour you don’t have to pay for. By conserving you’re also pitching in to support the grid during hot summer months—when you and your community rely on it the most.  

To learn more about how to read your bill, visit here. Our website includes many helpful tips for reducing your home energy usage. Make sure to click here for energy saving tips.