What is the ‘Monthly Service Fee?’

Posted on Feb 02 2017 in Bartholomew County REMC

Have you ever wondered what the “Monthly Service Fee” on your electric bill is? Well, you’re not alone. The charge covers our costs for connecting you to the electric grid and maintaining the electrical system.

Some of the key values behind the concept of a cooperative are openness and fairness — everyone paying their fair share. This is how the cooperative business model operates. The Electric Grid Connection Fee is your portion of the physical facilities and the maintenance of this equipment.  This includes the meter, service drop, transformer and a portion of the poles and wire connecting you to the nearest substation. It also includes maintenance of the lines (your guarantee that you will get power restored during an outage) and administrative costs. Basically, the cost to do business, spread throughout the membership. Without this charge, the cooperative would not have funds to do business and provide reliable power to our  members.

Everyone shares the costs of our facilities and maintenance because the system operates as a whole and provides reliable service to everyone — that is what a cooperative is all about. Additionally, as a rural electric cooperative, we cannot spread our fixed costs over as many customers as some of our investor-owned neighbors. In our rural area, we simply do not have as many customers per mile of line who can share the costs. However, we must provide everyone with the same quality of service. These fixed costs do not change regardless of the amount of electric energy purchased by the members and must be recovered for the cooperative to remain financially sound.

If you have any questions about your bill, please call our office at 812-372-2546.