INDEX - ENERGY ID# 0807-09


POSTED: 4 JUNE 2008 - 12:00pm HST

The Math of Costly Energy

image above:Detail of photo of Port Allen KIUC power plant by Tommy Horn on

by Brad Parsons on 4 June 2008

KIUC members pay $0.42 to $0.43 per kwh for electricity. By comparison MECO customers pay $0.28 per kwh for electricity. Kauai's are the highest electric rates in the country even though there are plenty of renewable energy opportunities here (solar, wind, hydro). Here are a couple of excellent letters to the editor taken from Kauai Garden Island News regarding Kauai Island Utility Coop:

The Math of Costly Energy

by Barbara Elmore, Lihu‘e

It’s the “same old, same old” business as usual with Kaua‘i Island Utility Cooperative. Now we “members” know for sure how much the KIUC board cares for our input into board elections. The facade of governance by the “members” has given way to the reality of the “Old Boys’ Club.”

They cared zero for what the members wanted and, without making any effort to inform the public of their pet nominations, chose their old buddies (who had not even bothered to run in the election) to come back and join the club.
One thing they do care about, however, is their ability to continue collecting our outrageous fixed “customer charge” and our constantly ballooning “energy adjustment” fees month after month.

I’ll keep this very simple. I live alone in a small apartment and probably use less electricity than 99 percent of the other people on Kaua‘i. Yet last month my “energy adjustment” charge from KIUC was over $53. At my retail pump cost of $4 per gallon, I effectively purchased about 13 extra gallons of fuel for KIUC. Actually, since they get a bulk discount, my $53 probably bought 20-25 extra gallons for KIUC.

I understand there are about 22,000 residential homes on the island. Leaving aside the larger commercial accounts including businesses, hotels, timeshares and churches (all of which presumably have much larger utility bills) and assuming for the sake of argument that my electric bill is typical (even though presumably the bills for families and large homes would be much higher), I did the following calculations:

If each of the 22,000 residential homes paid $53 last month in “energy adjustments,” that would have brought in an extra $1.166 million in one month to KIUC to help them pay for their fuel, or a total of $13.992 million per year. That is an approximate amount because the charges will undoubtedly increase each month. But who needs that much extra fuel?

Another way to look at it: If each residential “member” (customer) paid for an extra 20 gallons of fuel for KIUC, they would have been forced to provide 440,000 gallons to KIUC for one month, or 5,280,000 gallons per year. Remember this is the most conservative calculation based on my simple, single lifestyle. Remember, too, that these figures do not include the massive amounts collected from commercial “member” accounts.

That’s not all. In addition to the charges for actual electricity used, each residential account also pays a fixed fee of $9.72 each month for a “customer charge.” Thus, those 22,000 homes pay $213,840 each month, or a total of $2.56 million every year just for the “customer charge.”

At what point will people begin to stand up and say, “I’m not going to take this any more?”

Saving energy doesn’t save money?
by Elli Ward, Lihu‘e

A Sunday letter (“The math of costly energy,” Letters, June 1) drove me to scrutinize my KIUC bills.

I had been lulled by using autopay the past year and concerned myself only with checking that I didn’t bounce any accounts. Another lesson learned.

Thanks to B. Elmore’s math calculations, I too discovered that in one year, my energy adjustment charge jumped 100 percent. My first reaction was to question what’s the use of all the energy-saving stuff I’ve put in place all this time? My home has CFS lightbulbs, we live without a dishwasher, air conditioning, clothes dryer, electric water heater, plasma TV.

We unplug or turn off lights and small appliances when not in use. Shouldn’t we be rewarded instead based on the kilowatt hours we consume? And what is this monthly “customer charge” of $9.72? Is this a membership fee that’s kind of like a regressive tax?

I am in “shock and awe” at the millions of dollars that our co-op collects per month just from the 22,000 residential customers. If one were to add the total monthly collection from all KIUC customers, how many millions are we talking about? The answer should be of great concern to all of us because:

(1) Our bill is directly tied to global oil supply and price;

(2) Is KIUC allocating enough money to fund projects in new sources of energy so we have alternative remedies to the skyrocketing costs of oil? KIUC’s goal of 50 percent renewable energy within 15 years from now is too little too late for many of us; for example retirees on fixed income and working-class families.

(3) My small household with an average monthly consumption of 200 KW hours is eligible for a refund check under $35. That will go toward a quarter tank of gas for my compact car.

I have a humble suggestion: instead of KIUC rewarding the co-op’s biggest energy users with checks presented in person, shouldn’t the reward go to the biggest customers who demonstrated the biggest reduction in use for the year? Not to sound like “sour grapes” — just a thought.

see also:
Island Breath: KIUC Board Recommendations 5/26/08
Island Breath: Kaaui over a Barrel - Ben Sullivan