Frequently Asked Questions
What is a service charge?

The Michigan Public Service Commission has requested that all electric utilities show the service charge as a separate line item on the consumer’s bill. In the future under re-regulation additional items may be shown separately.

What Members Should Know About the Service Charge What is the Service Charge and why is it on my bill?
The Service Charge is a monthly fee that is charged to all Alger Delta members to help cover some of the fixed costs of supplying electricity. Poles, wires, crossarms, transformers, hardware, trucks, vehicles, insurance, interest, and taxes are just a few examples of large costs that Alger Delta must pay regardless of how much electricity is used by our members. These costs, which are reasonably predictable, can be distributed fairly through a monthly service charge.

Who determines the service charge?
Service charges and rates are determined through a collaborative effort between the cooperative’s members, the Alger Delta board and management, and the Michigan Public Service Commission (MPSC). Alger Delta is required to file all rates and tariffs with the MPSC for approval. The MPSC reviews our rates and tariffs along with the supporting documents, statements, and testimony to determine if the rate, including the service charge portion, is justified.

How much is the service charge?
In 2008 the service charge for residential members is $12 per month/per meter. For seasonal members the charge is $14 per month/per member.

Why do seasonal members pay a higher service charge?
Seasonal members generally use much less electricity than residential members. Because of this, there is less opportunity to recover operating costs through the energy rate (which is the charge for each kilowatt-hour used). So, a higher service charge for seasonal members is one small step toward offsetting this difference.

I’m a seasonal member and I have to pay the service charge for the whole year – in advance! Why?
Because seasonal members are only billed once per year, the whole service charge must be applied to the bill. The service charge is billed in advance to help cover the fixed costs of serving these accounts throughout the year.

Where can I find out more?
You can learn more about rates and tariffs, including service charges, at http://www.michigan.gov/mpsc or by calling a Customer Service Representative at 906-428-4141.