Business owners confused, but satisfied

Donna Lord, owner of Millville’s Lord’s Landscaping, opened her most recent electric bill recently while she talked on the phone. As a business-owning member of the Bethany-Fenwick Area Chamber of Commerce’s new electric cooperative, she knew the program had saved her money on the October bill. She just was not sure how much.

“It’s very hard to decipher,” Lord said as she compared two bills side-by-side, one new and one old. “I don’t know how to compare them because I don’t know what it would have been otherwise.”

Despite the confusion though, Lord, who had been paying 10.57 cents per kWh at her business before the switch to 9.897 cents last month, said she was happy with the new program.

“I did get the rate I was promised. I think I will save, but not as much as some of the companies that use more electricity than I do. (But) I still think it’s a good thing,” Lord said, adding that she signed the co-op contract for its price stability.

Lord was one of 74 local business owners, hit hard by May’s Delmarva Power rate increase, to sign up for participation in the Chamber’s co-op this summer. Every member of the co-op signed a three-year, fixed-rate, 9.897 cents per kWh, contract that Chamber officials said was meant to offer just the type of budget stability Lord mentioned.

The contract also relieved business owners of a demand charge that, for some, accounted for up to 50 percent of their electric usage charges, according to Richard Anderson, the principal with the Maryland-based CQI Associates, which negotiated the rate for the Chamber. Electric companies such as Delmarva Power keep backup power available for businesses for emergency purposes, which results in the additional charge.

“Demand charges have always been a significant cost. It’s reserve capacity,” Anderson said. “It’s like having a bullpen. If a guy gets hurt, you have to be able to put in another player. You have to pay for additional payroll to keep that guy on the bench.”

Like Lord and many others, Kevin Lynch registered his business, Selbyville Pet and Garden, in the co-op for a specific reason. In his case, it was to rid his business of the hefty demand charge.

“My bill went from (more than) $1,300 to $950 bucks. It’s great,” Lynch said, and “the demand fee is what it is.”

Lynch said that before receiving his new rate the demand charge was about $150 monthly year-round, but could account for half of the usage charges in the summer, as Anderson mentioned. He estimated that the majority of last month’s savings came from the demand-charge relief. But, again like Lord, he did not know how much.

Robert Daisey, co-owner of Delaware Appliance, said demand charges do not severely affect his business. He described the difference as “very minimal — but it’s a long-term thing.” Neither he nor Brad Connor, of Connor’s Package Store, could put an exact figure on the difference, but both knew the program had saved them money.

“I can see where the new rate has saved me quite a bit of money. Last bill looks like about 20 percent,” Connor said, citing the demand charge relief.

But as Connor looked at his bill last Friday, he still could not tell what rate he was now paying, exuding the confusion that has become common with ratepayers and their bills. But like Connor and Lord, most do not seem to care whether they can read their bills correctly or not — only if the bottom line is in their favor.

“You’re talking with someone who doesn’t know. The rate is definitely lower than what I was getting,” Connor said. “When I write checks for less money, that’s all I care about.”