Commercial Rates
Minnesota Power provides a range of rate options tailored to meet the diverse needs of commercial customers. These rates are determined by factors such as energy usage and the type of facility. They accommodate a variety of applications, from street lighting and small retail establishments to large industrial operations.
Rate ScheduleIn certain situations, adjusting to a different rate structure may be advantageous for commercial customers, particularly if there are significant changes in electricity usage. Minnesota Power can help by conducting a rate comparison analysis to determine the most suitable rate for your facility.
Our representatives can assist with questions about obtaining a rate comparison.
To meet your representative, click here.
Electricity demand, measured in kilowatts (kW), is the rate at which electricity is used at a specific point in time, not the total amount of energy used over a period. Demand is the maximum amount of power drawn for a given time interval during a billing period.
Any customer exceeding usage of 10 kW for one month or 2.500 kWh for three consecutive months will be automatically placed on a demand rate. New construction customers may be placed on a demand rate if they anticipate exceeding the usage listed above.
Read more here.
Peak demand: This is the highest level of electricity demand recorded during a billing cycle. Utilities use this value to determine demand charges, which are typically added to your monthly bill. Managing peak demand is crucial for reducing costs.
Demand charges: These charges are based on the highest level of power drawn during a short interval (usually 15 minutes) within the billing period. For commercial and industrial customers, demand charges can make up a significant portion of the electricity bill.
- Load shifting: Moving energy-intensive operations to off-peak hours.
- Energy storage: Using batteries to supply power during peak demand periods.
- Demand response programs: Participating in utility programs that incentivize reducing demand during high-stress periods on the grid.
Why demand matters: High demand can strain the electrical grid, especially during peak hours. Utilities use demand charges to encourage customers to spread out their energy usage and avoid spikes that could lead to outages or infrastructure stress.
Find programs and rebates to help your business save energy:
mnpower.com/ProgramsRebates/Business
Connect with our commercial team:
mnpower.com/ProgramsRebates/Business/MeetTheTeam
Demand
Electricity demand, measured in kilowatts (kW), is the rate at which electricity is used at a specific point in time.
Fuel and Purchased Energy
The Fuel and Purchased Energy Adjustment is a mechanism for collecting fuel and purchased power costs that Minnesota Power incurs to serve customer load. It is a combination of approved forecast fuel rate for the current year and approved fuel true-up rates from previous years.
Single Phase Power
Single phase power is a basic form of alternating current (AC) electricity, delivered through a single "phase" made up of a live wire and a neutral wire, commonly used in residential and small commercial settings.
Three Phase Power
Three phase power is a type of AC power where three separate currents are generated, each with a voltage that changes in a sinusoidal pattern, but with each current’s peak occurring 120 degrees after the previous one. This is ideal for powering large motors and other equipment that requires a steady, reliable power source.
Single-Phase vs. Three-Phase Power
- Single-Phase: Best for low-power applications, such as residential and small commercial use.
- Three-Phase: Designed for high-power applications, such as industrial machinery, large HVAC systems, and heavy equipment.
Example of Single-Phase Power Usage
A small retail store might use single-phase power to operate lighting, cash registers, computers, and small refrigeration units. However, if the store expands to include larger equipment, such as industrial-grade freezers or HVAC systems, it may need to upgrade to three-phase power.
Dual Fuel
Dual Fuel is an interruptible service rate designed primarily for electric heat that provides customers with a discount on their usage in exchange for occasional interruptions from Minnesota Power. Interruptions occur when loads across our territory AND pricing on the electric market are both high. These interruptions help keep electricity costs down for all Minnesota Power customers.
Commercial and Industrial Fixed Off-Peak Service
Refers to a rate plan or electricity service designed for businesses and industrial facilities that use electricity primarily during off-peak hours when overall demand on the electrical grid is lower, such as late at night or early morning.
Key Features:
Fixed Rates: The cost per unit of electricity (e.g., kilowatt-hour) is predetermined and does not fluctuate based on market conditions during off-peak hours.
Off-Peak Hours: These are specific times defined by the utility when electricity demand is lower. Businesses are incentivized to shift their energy usage to these periods to take advantage of lower rates.
Customer Type: This service is tailored for commercial and industrial customers, such as factories, warehouses, or large office buildings, that can schedule their operations to align with off-peak hours.
Cost Savings: By using electricity during off-peak hours, businesses can reduce their energy costs compared to standard rate plans.
Grid Efficiency: Encouraging off-peak usage helps Minnesota Power balance demand and reduce strain on the grid during peak hours.
If you are considering this type of service, it’s important to review your energy usage patterns and consult with us to determine if it aligns with your operational needs.
Power Factor
Power factor is a measure of how efficiently electrical power is being used. In simple terms, it shows how much of the electricity you’re using is doing useful work versus how much is being wasted.
The Soda Analogy:
Imagine you’re drinking a soda with a straw. The soda is the “useful power” (the part you want), and the foam on top is the “wasted power” (the part you don’t need). A high power factor means there’s more soda and less foam, so you’re using electricity efficiently. A low power factor means there’s a lot of foam and not much soda, so electricity is being wasted.
In technical terms:
- A power factor of 1 (or 100%) means all electricity is used effectively.
- A power factor less than 1 means some electricity is being wasted, often due to inefficiencies in the equipment or the way power is being delivered.
Improving the power factor can help reduce energy waste, lower electricity bills, and improve the efficiency of the electrical system.
