SRP Electric Bill Charges

Ever wonder what your SRP rates are made up of?  I did and they don't make it obvious but here is what I found out.
If your on the Time of Use Plan you get billed $15 a month service charge.  I used to think this was just the meter rental fee.  Try Again!  It is made up of a $2.81 monthly billing / collection, $3.00 Competitive Customer Service, .79 meter reading fee, $4.18 Meter, $4.22 Distribution Facilities Fee.  This means yearly we pay $33.72 for billing/collections, $59.64 for meter and meter reading, $36.00 competitive customer service, and $50.64 for distribution facilities fee to total $180.00. 

My first thought is we have to pay for the bills they send us.  My belief is that when a company is formed be it private or public.  If you want your customers to pay you a bill must be sent to them or make payment due at the time of the sale.  But, if you have to bill them that cost is already built into the sale price of the product.  It is a cost of doing business and should be included in the mark up of the item.  If I sell an item to company A who takes the item and uses it to make something else.  The price company A pays me for the item will include the cost of paperwork (shipping, purchase orders, contracts, etc.), wages, utilities, plus a mark-up to turn a profit.  Then company B will take the the cost of all the items bought to make the item plus the cost of paperwork, wages, etc. and add a mark-up to turn a profit before selling it.  Once the consumer gets the item the final cost could go from say $1.50 up to $8.00 just because it went through so many hands.  However, I believe that the cost of actually sending a bill should not be included in the price sold.  Because this is basically an office supply expense for paper, ink, envelopes, and postage.  These expenses are deductions on that company's taxes at the end of the year.  If they can deduct it as an office supply expense on taxes it should not be able to be charged to the consumer.  Otherwise it is a reimbursed expense and not an actual expense incurred.

My second thought was; what the heck is a competitive customer service fee?  And why am I paying $36.00 annually for it.  Then I thought for a second and realized that the taxes we pay do not give the tax rate we pay.  Since this is basically a sales tax, are we paying taxes on these charges that are clearly services and not a rent or the actual electricity its self?

Then came the real interesting part.  In the actual rate break down there is another charge for competitive customer service that is charged per KWH used.  We pay from $.0002 to $.0036 per KWH for the same service we already pay $36.00 per year for.  These numbers may not seem that big until you take these numbers and multiply them out by the number of customers SRP has.  Then think about the number of years you have had service with SRP and the number is no longer small.

SRP is the cheapest electricity company in Arizona, you can imagine what APS customers are paying for.  However, it doesn't mean we should not question what these charges are for.