Understanding KMPUD's Electric Rates
KMPUD recently completed its five-year electric rate study, with updated rates taking effect on July 1, 2026. We understand that changes to utility rates often raise questions, so we'd like to provide some background on how electric rates are structured and why the Board made these decisions.
Why is KMPUD Different?
Although KMPUD serves a small mountain community, we operate and maintain an electric system comparable in complexity to much larger utilities. This includes substations, transformers, underground distribution lines, and a 25-mile transmission interconnection that connects Kirkwood to California's electric grid.
How Your Electric Bill is Structured:
Your monthly electric bill consists of three components:
1. Base Rate – Covers fixed costs such as infrastructure, debt repayment, and maintaining the electric system.
2. Usage Rate – Covers the cost of purchasing electricity and other expenses that vary with energy consumption.
3. Meter Charge – Covers metering and billing services.
Recovering most fixed costs through the Base Rate helps keep KMPUD financially stable while allowing the Usage Rate to remain relatively low. This makes electricity more affordable for customers who choose electric vehicles, heat pumps, induction cooking, and other electric technologies.
As part of the FY2027 rate study, the Board adopted a new method for determining residential Base Rates.
Previously, residential Base Rates were largely based on a home's historical electricity usage. Over time, this created inconsistencies, particularly when homes changed ownership, occupancy patterns shifted, or homeowners added new electric appliances.
Beginning July 1, 2026, residential Base Rates are based primarily on the size of a home's electrical service rather than its historical energy use. Most homes, those with electrical service of 200 amps or less are assigned one Equivalent Dwelling Unit (EDU), creating a simpler and more consistent system for allocating fixed costs.
Looking Toward the Future
When KMPUD built the interconnection to the California electric grid, it was designed with room for future growth. Today, the system has significantly more capacity than is currently being used.
As more homes and businesses adopt electric vehicles, heat pumps, induction cooking, and other electric technologies, increased electric usage helps spread fixed costs over more energy sales. Over time, that additional revenue can accelerate repayment of the District's remaining debt and reduce long-term pressure on Base Rates.
Learn More
KMPUD is committed to transparency and helping customers understand how their electric utility operates. Additional information, including answers to frequently asked questions about electric rates, is available on the District's website or by contacting the KMPUD office.