Your electric bill is generally divided into three categories: delivery charges, supply charges, and taxes.

Traditionally, delivery charges, which cover the costs of getting electricity to your home, have been set by the Illinois Commerce Commission (ICC) after 11-month rate-hike cases. However, Ameren and ComEd now set their rates through a legislatively approved formula that is subject to ICC monitoring.

The cost of the actual power (the supply charge) that ComEd and Ameren send to their customers is left up to the market. The lone exception among Illinois' major electric utilities is MidAmerican. That company's supply and delivery charges are fully regulated.

Electricity usage is billed by the kilowatt-hour (kWh)—roughly enough power to cook a pot of rice in an hour. A customer's previous and current meter readings are listed on the bill, along with the dates they were taken. The difference between the two readings is the electricity usage for the current billing period (typically a month).

A utility company should read a customer's meter at least once every other month. If it doesn't read your meter, your monthly bill will be estimated, and "E," "EST," or "ESTIMATED" will appear on it. That means your usage for that month was based on last year's usage for the same month, adjusted for weather.

If the company doesn't read your meter for two consecutive months, call the utility and find out why. Request an actual reading, or call CUB, at 1-800-669-5556, to learn how to read your own meter. (You may see some or all of these charges on your bill.) Customer charge (basic service charge)
This flat fee covers the administrative costs of doing business, such as billing, postage, and building rent costs.

Distribution delivery charge (distribution facilities charge)
This per-kWh charge covers the costs of delivering power to your home and maintaining the equipment and wires that carry the electricity. This charge also covers fixed costs not recovered through the customer charge.

Meter charge (standard metering charge)
This charge covers the costs of meter reading and other services such as installing, maintaining, and testing meter equipment. Ameren's monthly charge is $4.72 and ComEd's is $2.86. Energy charge (a.k.a. electricity supply charge, purchased electricity)
This per-kWh rate is for the actual power you use. The rate is multiplied by how many kWh you use. ComEd and Ameren are supposed to pass these energy costs on to customers with no markup. However, this charge may be slightly higher than the actual market price because it is adjusted for other costs, such as "line loss." That's when power travelling over the lines is lost as it gives off heat. (Note: MidAmerican Energy's charge is set by the ICC.)

Market value adjustment (purchased electricity adjustment)
Your utility is supposed to pass the price of electricity on to customers with no markup. This monthly adjustment, a credit or a debit, attempts to "true-up" any discrepancy (over or under) between what Ameren or ComEd paid for electricity and what you paid for the energy charge.

Supply cost adjustment
This covers other administrative costs connected to procuring power. ComEd does not have a separate line item for this charge, but rolls it into the energy charge.

Transmission service(s) charge
This is similar to the distribution charge, which covers the delivery of power from the utility to your home. However, this charge covers delivery from the power generator to your utility. If your utility wants to increase this charge, it has to get approval from the Federal Energy Regulatory Commission (FERC). ComEd's charge is .765 cents per kWh. Ameren's charge, based on a formula, changes monthly. State tax (Illinois state electricity excise tax)
This state tax is a third-of-a-cent per kWh.

Municipal tax
State law caps the amount of utility taxes that cities can impose. The utility collects the money and forwards it to the municipality. It's also called the "local government compliance charge."

Environmental cost recovery
This charge covers clean-up costs at former gas-manufacturing sites. It's also called the "environmental factor EPA charge" and the "electric environmental adjustment clause."

Franchise cost
Some cities require a utility to pay a fee or provide other benefits in exchange for the right to deliver electricity to them. Utilities recover those costs from the customers in those communities.

Smart meter program
This is a monthly charge that supported a ComEd pilot program in select communities to test whether the consumer benefits of "smart grid" improvements to the electricity system outweigh the costs. The charge was designed to cost no more than $5 per customer for the entire year. A state appellate court ruling in October 2010 struck down the charge. The decision impacts cases going forward. ComEd was allowed to cover lingering costs for the smart-grid pilot program before discontinuing the charge.

Energy Efficiency Programs
Under the Public Utilities Act, ComEd and Ameren can recover the costs of energy-efficiency and "demand-response" programs designed to help consumers save money. This per kWh charge covers programs such as air-conditioner cycling, appliance recycling, and Real-Time Pricing. Learn more about these incentives at CUBLiveWire.org. Note: The space heat rates are NOT applicable to new customers.

Note: The space heat rates are NOT applicable to new customers.