Why does the PUD need to change the rate structure?
With the current rate structure, customers who use more energy generally pay disproportionately more for the Demand charge than customers who consume less energy. This is because the Demand charge is embedded into the energy rates. Therefore, when their energy consumption increases, the Demand charge automatically increases, whether or not the customer has a high demand usage.
On the other hand, customers who have lower energy consumption generally pay less for the Demand charge because it is built into the energy rates, even if their demand use is high. In effect, they are paying less than their fair share for using the PUD system.
The new rate structure is designed to be more transparent and equitable. The goal is to ensure that all customers are paying their fair share of using the PUD system, and that the PUD has a way to assign costs that are directly related to demand use, and not based on total energy consumption.