From June 1st to September 31st, electricity for Colorado homes will cost up to $0.15 per kilowatt-hour (kWh). Traditionally this year, electricity from Xcel Energy in Colorado has run around $0.105 per kWh.

With the new two tiered rate system just released by Xcel, every kilowatt-hour (kWh) of electricity above 500 used by a residential home in a given month will be subject to this much higher fee. The average household electricity consumption in Colorado is around 700kWh per month - which means the average family would pay the 2nd-tier rate on about 200kWh of their usage.

Here's a simple breakdown

Traditional Rate System:

700kWh (Usage) x $0.105 (Avg. Electricity Rate) = $73.50

New 2-Tier Rate System:

Tier 1 - 500kWh (Usage) x $0.10 (Avg. Tier 1 Rate) = $50.00
Tier 2 - 200kWh (Usage) x $0.15 (Avg. Tier 2 Rate) = $30.00
Total = $80.00 ($0.115 per kWh)

This would represent a 9% increase. For bigger users of electricity, this new tier will represent a significant increase in their summer electricity bill.

Fortunately you have a remedy - solar energy! Solar is producing best during these summer months, and can drive your usage into the lower tier or eliminate it altogether.

Solar just got more valuable in Colorado.