The very first thing I glommed onto in the Napocor rate filing had nothing what-so-ever to do with justifications for their revenue requirement increase. Instead, the very first thing I looked at was the structure of the time-of-use rate design. I had been pleased with the existing design, but the new one has some very bad policy implications for our adoption of new, cleaner technologies and for our adoption of technologies and practices for greater energy efficiency. So … it’s bad.
First, here is a chart showing a comparison of the old and new rates. I’ve arbitrarily chosen the Visayas Grid tariff for this discussion. I believe it holds for all three grids, in general.
In both rate designs (old and new) you can see that the four hour period between 6 pm and 10 pm was the “peak period” during which Napocor charged the highest. I’ve done analyses on certain electric cooperative loads, and it turns out that the Napocor loads have about the same diurnal shape as the the price curve.
The following chart also shows both tariffs – but I have indexed each tariff to it’s lowest price. This chart shows that under the old design, the peak hour price was approximately four times the off-peak (or lowest hourly) price. But under the new design, peak hour prices are only about three times the off-peak price.
The following chart shows the absolute P/kWh increase that Napocor has applied for each hour.
But here’s the kicker. The percent increase at each hour is given by the following chart:
So you can clearly see that the greatest percentage increase has been applied to the lowest hourly loads, and the smallest percentage has been applied to the highest hourly loads!
Do you think there has been inappropriate influence applied in this rate design? We can’t tell. We don’t know why Napocor decided to do this. I hope some of the intervenors will pursue this point, because it has important implications to all of us. Indeed, I would suggest it has implications to our future – my future, my kids’ future, and yours. I’ll discuss it further, soon.
You can grab a copy of my spreadsheet and charts here.