Are you looking for information on a term that you read on your electric bill? You are in the right place. You will find a glossary of terms below.
What is a Demand Charge and why am I just noticing it now?
A demand charge is a fee based on the highest level of electricity you use at any one time during a billing period. It reflects the cost of maintaining the system capacity needed to meet peak demand, not just the total energy you use over time.
Think of your electric use like driving a car:
- Energy charge (kWh) = how many miles you drove
- Demand charge (kW) = how hard you pressed the gas pedal at one moment to pass another car
Your speedometer shows your miles per hour (MPH) at a specific instant. Electric demand works the same way — it measures the rate at which electricity is being used at a given time.
For example:
- Running a few lights and a TV is like cruising at 30 MPH.
- Turning on the oven, dryer, air conditioner, and microwave all at once is like accelerating to 90 MPH to pass that car.
Even if you only “speed” for a short time, the electric cooperative still has to build and maintain a system capable of handling that peak demand. Demand charges help cover the cost of having enough equipment and capacity ready whenever members need high amounts of electricity all at once.
How come I've never noticed it before?
This is a charge that began appearing on member billing in April of 2024, with no cost associated. In May 2026, the board of directors approved reducing the kilowatt hour rate (the amount you pay per kilowatt hour used) by roughly 2% and adding a charge of $0.85/kW to residential accounts. You can find articles talking about and announcing the charge in the pages of our Wisconsin Electric Cooperative News magazine - months December 2025 - May 2026. You can also find our deep dive on Demand Charges on Episode 2 of our Plugged In video podcast posted in the left column.
Why are you charging for it now?
The short answer is to better reflect both a member’s actual strain on the energy system and how Dunn Energy is billed from our power supplier. This helps bill members more equitably, reducing subsidization across members. Capacity, or the amount of energy needed during system peak demand, is how electric grids have to be built. Not just for the average demand. By reducing the energy rate and adding a demand charge, members are more accurately billed.
What can I do to lessen my demand charge?
Unstack your energy usage. Don't do everything at once.
Reduce your demand by not using high consumption items, like pool pumps, dishwashers, clothes dryers, and other appliances or motors at the same time.
You can read more about it in our article that was published in the March 2026 issue of the Wisconsin Energy Cooperative News magazine.
What is PCA and why am I just seeing it now?
The Power Cost Adjustment is a separate line item on your billing statement that reflects the increases/decreases in the co-op's cost of wholesale power purchased from Dairyland Power Coop (DPC). The fluctuation in PCA is largely caused by the cost of fuel for generation.
PCA has been listed, as needed, on the bill statements for many years. This credit or charge has never been this large, so many members didn’t notice it. We fully recognize that this historically high fluctuation was unanticipated.
The cost of power is now nearly 70% of our total annual expenses. (for every $1 we spend, 70 cents goes straight to DPC for purchasing the power we distribute to our members.)
DPC is seeing higher costs to generate power and purchase power. Transmission lines that move energy from where it is generated (Power Plants) to where it is needed (members’ home/farm) are congested. These instances raise market prices for power.
In the fall and spring, electricity needed by members is lower and power plants use this time to conduct much-needed maintenance before the winter and summer peak seasons. These necessary and scheduled outages for maintenance lower the amount of power available, which increases prices in the energy market. Extreme temperatures, both cold and hot, also increase demand which increases costs.
Will this happen again?
We do not know how long this will last, or if it will happen again, but we are working to reduce other operating expenses.
DEC is a not-for-profit organization and we can only collect the actual cost of power through rates. We return any profits (margins) to the members each year through capital credit allocations and retirements and not to investors or shareholders.
What Can You do as a Member?
Unstack your energy usage. Don't do everything at once.
When temperatures are extremely hot or cold, reduce your demand by not using non-essential energy-consuming items, like pool pumps, dishwashers, clothes dryers, and other appliances or motors not needed to sustain life.
Visit our rebate page for more energy-saving resources. Conservation helps not only your energy bill, but you co-ops as well.
