GeoHC Utility Margin Calculator

Non-coincidental Demand: The highest demand at any given time, usually measured in 24-hour increments or monthly increments.

Coincidental Demand: Demand measured during a defined time period; in the case of a Generation and Transmission System providing power to a cooperative, it is the highest peak load at the cooperative coincident with the highest peak load of the G&T.  Some utilities peak in the summer, while others are in the winter while others peak in both seasons.

Billing Demand: This is the Kilowatt Demand measured during the Coincident period and multiplied by a dollar value to arrive at the monthly billing demand component that is part of the G&T power bill to the Cooperative.

PF– Power Factor: This is a measurement of the efficiency of the device consuming electricity. 100% power factor is realized with all resistive-type loads, water heaters, space heaters, etc. Less than 100% power factors are realized with motor loads due to friction and drag on the motors.  Above 92% is acceptable. Below 92% power factors lead to unbalanced services and may require voltage regulators, capacitors, etc.

LF– Load Factor: This is a measurement of the efficiency of the total consumption of energy over a given period of time in relation to its potential consumption.  (Ex. If a 1000-watt (1 kW) device consumes 1 kWh of energy in a one-hour period, it has a 100% load factor.  If a 1 kW device consumes .5 kWh in a one-hour period there is a 50% load factor, etc.)

Base Rate: – This is the portion of each kilowatt hour charge which is necessary to fully recover the cost of purchased power.  (Ex. If the base rate requires 6 cents per kilowatt hour sold to recover the total energy purchased on the wholesale power bill, and the published rate is 8 cents, it means the cooperative has 2 cents of each kilowatt hour left over for operating the cooperative because 6 cents is needed to pay for power purchased.  If a month occurs when the purchased power needs 7 cents recovery, it will reduce the margin from 2 cents to 1 cent leaving the cooperative short of its operational needs.  A power cost adjustment of 1 cent would then be added to the 8 cents so the cooperative remains whole on its operational needs.  The reverse of that is true if the wholesale cost of power drops below 6 cents per kWh.  The power cost adjustment would be a negative factor.)

PCA – Power Cost Adjustment: This is an adjustment made to the published rates when the wholesale cost of power exceeds or falls short of being collected by the Base Rate.

MSF – Margin Stabilization Factor: This is a factor designed for multiple uses.  One use of this factor is to recover additional operating funds needed to meet lending ratio requirements in a year when the cooperative’s budget has been increased due to catastrophic storm costs, or mild weather or any situation occurring which may cause the cooperative to miss its ratio targets.  It is applied as an adjustment factor on each kilowatt consumed until the needed revenues have been achieved.  It is a short-term avoidance of a rate increase.  A second use is as a factor designed to recover temporary investment costs in programs such as demand control, geo loops, etc.

Gross Receipts: This is a tax collected by cooperatives in lieu of sales tax.  2% of total sales is added to a customer’s bill and collected on behalf of the Oklahoma Tax Commission and is passed on to schools.

Wholesale Cost of Power: This is the total cost of power from the cooperative’s power supplier before any markup is added and passed on to the customer by the cooperative.  Wholesale power cost consists of generation demand, transmission demand, distribution demand, energy, fuel and any other charges from the power provider.

CP Demand – Coincidental Peak Demand: This is the amount of total capacity needed by the cooperative at the time of maximum generation requirements by the wholesale power provider.

NCP Demand – Non-Coincidental Peak Demand: This is the point in time during a one-month period that represents the maximum total capacity needed by the cooperative, having no correlation with the maximum generation period of the power provider.

Load Control – Term given to the act of reducing or eliminating CP Demand during a time period which coincides with WFEC’s peak time periods, and which reduces the average wholesale cost of power to the cooperative as a result.

Fuel: This is a factor charged by the power provider that represents its rolling average cost of fuel for generation purposes.  It is applied on a per kilowatt hour basis.

Energy – This is a factor charged by the power provider that represents the cost of the generation equipment and its related expenses, to supply power to cooperatives.  This factor is charged on a per kilowatt hour basis and varies quarterly depending on the season. 

Mil: This is a number defined as 1/10^th of a cent or .001.  If energy costs .00636 cents per kilowatt hour, then the energy cost is 6.36 mils.

Tariff: The officially recognized term for rates used by regulatory agencies.

Geo – Geothermal Heat Pump: Type of heating and cooling system which utilizes the stored energy capacity and capabilities of the earth to condition a home or business by means of water transference.

Air to Air – Air Source Heat Pump: Type of heating and cooling system which utilizes the energy that exists in the outdoor air to condition a home or business.