Your electric utility and the recent peak alert

Winter peak demand often occurs:

• Early in the morning

• In the evening

• During very cold weather

At these times, heaters, water heaters, lights, and appliances are all running together.

Even if peak demand only lasts a short time, the electric system upstream of Salem must be built to handle it.

When a new, higher peak demand is reached:

• A demand rate is multiplied by that peak number

• That sets a monthly demand charge for the next 12 months

This applies no matter what time of year the new peak happens.

If a higher peak is not reached during those 12 months:

• The demand charge resets

• It resets to the next highest demand used during the past year

How peak demand affects electric costs

The City of Salem does not generate electricity. The city also does not control the cost of power generation nor the cost of delivering power to Salem. Those costs are set before the electricity ever reaches the city’s electric system.

When peak demand is higher:

• Power costs increase

• Those costs can remain in place for up to a year

• Demand costs become part of the City’s overall electric expense

How electric rates are set in Salem

The City of Salem generally sets electric rates once a year.

This means:

• The electric rate on your utility bill does not change from month to month

• Your rate stays the same throughout the year

• Rates only change when new annual rates are approved (generally in June or July)

When new rates are calculated:

• Power costs, including demand charges, are reviewed

• Any changes in demand are included in the larger rate calculation

• Rates are set to cover the cost of providing reliable electric service

Peak demand does not cause sudden monthly spikes in your electric rate, but it does affect future rate decisions.

How customers can help reduce winter peak demand

Small actions by many people can help lower peak demand and control long-term costs.

Helpful winter tips:

Heating habits

• Lower thermostats a few degrees

• Wear warmer clothing indoors

• Use blankets instead of turning up the heat

Appliance use

• Avoid using large appliances during peak times (early morning and early evening)

• Run washers, dryers, and dishwashers later at night

• Spread out electricity use when possible

Home efficiency

• Close doors and windows tightly

• Seal drafts with weather stripping

• Close curtains at night to keep heat inside

Daily habits

• Turn off lights and electronics when not in use

• Use energy-efficient lighting and appliances

Why this matters for Salem

Lower winter peak demand helps:

• Keep power costs more stable

• Reduce pressure on future electric rates

• Protect the community from higher long-term costs

By working together during cold weather, Salem residents can help keep electricity reliable, affordable, and available for everyone.