How to Read Your Company's Electricity Bill and Tell Whether Solar Makes Sense

For a household, two data points are enough: consumption in kWh and the price per kWh. For a company they remain the base, but four others appear around them and move the result, and none is an accounting detail: each one changes the price of the kWh the plant is going to replace.

Before talking to an installer, have these on the table, taken from the bill or requested from the retailer.

A regulated user pays the unit cost of service, the CU defined by Resolución CREG 119 de 2007. It has two parts: a variable component, in pesos per kWh, and a fixed component, in pesos per bill. The maximum cost of a period is consumption multiplied by the variable component, plus the fixed one.

The variable component adds up six costs: energy purchase (G), use of the National Transmission System (T), use of the distribution networks (D), the retailing margin (Cv), energy losses (PR) and constraints (R). The retailer updates it whenever any of the indices behind it accumulates a change of 3% or more, so the tariff moves several times a year.

The resolution also distinguishes between CU and tariff. The tariff is the CU to which the applicable subsidy or levy factor is applied; for a non-residential user that neither receives a subsidy nor pays the levy, the tariff equals the CU. For a commercial company, the tariff is the CU plus the surcharge.

For solar, what matters is what is avoided. A kWh the plant produces and the company uses at that moment does not go through the import meter, so it is not billed: the whole variable component stops being paid at once. What keeps being paid, even if the plant works perfectly, is the fixed component.

Resolución CREG 015 de 2018 classifies distribution systems by nominal voltage: level 1 is below 1 kV; level 2, from 1 kV to below 30 kV; level 3, from 30 kV to below 57.5 kV; and level 4, from 57.5 kV to below 220 kV. A shop, an office or a small business is usually at level 1, on low voltage; a plant that receives power at medium voltage and has its own transformer is usually at level 2.

The level matters because the distribution cost D accumulates up to the level at which the user is connected, under article 10 of Resolución 119: a user connected at a higher level does not pay the charges of the lower ones, and its variable component is different. That is why retailers publish the tariff by voltage level and, at level 1, usually separate the cases where the transformer belongs to the grid operator, to the user or to both.

The practical consequence is that the effective price used to evaluate solar must come from that company's own bill and not from an average tariff. Two companies with the same consumption, one at level 1 with the operator's transformer and another at level 2 with its own, do not pay the same price per kWh and do not get the same return from the same plant.

The figure appears on the bill next to the user's details; if it is missing, ask the retailer for it in writing, and ask also for the tariff notice for that level.

The solidarity levy is the surcharge with which certain users fund the subsidy for strata 1, 2 and 3. The rule for companies is in paragraph 2 of article 211 of the Tax Code, as worded by article 2 of Ley 1430 de 2010: 20% of the cost of providing the service for commercial users, residential users in strata 5 and 6 and industrial users. For the latter, the same rule adds that, from 2012, they are not subject to the charge, and tasks the Government with defining who an industrial user is.

That definition is in Decreto 2860 de 2013. The treatment applies to industrial electricity users whose main economic activity is registered in the RUT (the tax register) under codes 011 to 360, 581 and 411 to 439 of the DIAN activity classification. What counts is the main activity, and the exemption applies at the premises where it is carried out. A shop or an office, whose codes are not on that list, is a commercial user and pays the 20%.

The exemption is not applied by itself. The user must request it in writing from the retailer, with a RUT issued within the last thirty days and the list of NIU (user identification numbers) of the sites where the main activity takes place; the retailer has fifteen days to decide, and to keep it the user files an updated RUT every six months. The Superintendency of Residential Public Utilities restated this in its Concepto 028 de 2026. If an industrial company's bill still carries the levy line, the first check is whether that request was made.

There is a question of validity that the financial model must take into account. As of 9 October 2026 the exemption is still governed by Decreto 2860, but the Government has published two drafts to change it: in August 2025 the Finance Ministry released a draft that cut the exempt codes to 101 through 332, that is, manufacturing in the strict sense, and in July 2026 it opened for comment another draft decree that would repeal 2860 and redefine who an industrial user is. In addition, as of 1 October 2026 a bill to abolish the exemption was on record in the Senate. They are drafts, not rules, and nobody knows how they will end: the prudent reading is to evaluate an industrial company's solar project with two effective prices, with and without the levy.

It matters for solar for an arithmetic reason. For a commercial user, every kWh the plant avoids buying also avoids the added 20%, so its effective price is higher than the CU; for an exempt industrial user, the effective price is the CU and the avoided kWh is worth less. On the energy used at the moment, the effect is direct, because it is simply not billed. On surplus that is netted as an energy credit, the base on which the retailer charges the levy is a question worth putting to it in writing before signing.

Resolución CREG 131 de 1998, in force since 1 January 2000, sets the boundary: an unregulated user is one who exceeds a demand of 0.1 MW or a consumption of 55 MWh a month at the same delivery point. It is the same boundary that frames the comparison in the article on how to pay for the project.

It shows on the bill. A regulated user pays the unit cost of Resolución 119, with the components described above. An unregulated user pays what its contract says: the price of the energy is negotiated, and CREG itself, when regulating the energy credit of self-generators, refers to the values agreed between the parties for these users.

For solar, the first step is to put the contract on the table: price, indexation, term and whether it provides for a minimum consumption or penalties for buying less energy. The effective price is calculated the same way, with the price actually paid per kWh. And it is worth checking whether the plant, by reducing what is bought, leaves the company below the boundary, because that can change its status.

Motors, compressors, refrigeration equipment and ballasts consume, besides the active energy that does the work, inductive reactive energy. The regulation sets a limit. Under Resolución CREG 101 035 de 2024, published in the Diario Oficial on 13 February 2024, the inductive power factor of an installation must be at least 0.90, determined hourly, or per billing period if the meter does not record hourly; it is equivalent to reactive energy not exceeding 50% of active energy. The capacitive power factor must be at least 0.90 at levels 1 and 2, 0.95 at level 3 and 0.98 at level 4, equivalent to a reactive-to-active ratio of 50%, 33% and 20%, calculated over the billing period.

A user that exceeds the limits pays for the transport of excess reactive energy, under chapter 12 of Resolución CREG 015 de 2018, and the grid operator may require it to install equipment to control and measure reactive energy. On the bill it appears as a reactive-energy line or an excess reactive transport line, under whatever name each retailer uses. The absence of the line is not enough to conclude there is no problem: it may be because the meter does not measure reactive energy.

What changes with a solar plant. In daylight the plant reduces the active energy drawn from the grid, but not the reactive energy the company's equipment demands: the ratio between the two rises and with it the risk of crossing the limit. It is an effect calculated from the hourly profile and corrected, if needed, with compensation or with the inverter's ability to supply reactive power, depending on the model. It is a technical question for the installer, not a reason to drop the project. There is precedent: in 2022 CREG itself received complaints from self-generators about capacitive reactive charges, which is part of what led to the new limits.

The rules also contain a favourable provision. Decreto 929 de 2023 provides that users with small-scale self-generation from non-conventional renewable sources are exempt from reactive-energy charges (article 4, paragraph 2), and Resolución CREG 101 072 de 2025 cites it in its recitals. Before counting on it in the model, ask the retailer how it applies it on the bill: it depends on the system being an AGPE (small-scale self-generator), that is, up to 1 MW.

The energy the plant produces and the company uses at that moment is not billed. All the components of that kWh —energy purchase, transmission, distribution, retailing, losses and constraints— are therefore no longer paid, along with the levy that would accompany it, if the company pays it.

Surplus follows another rule. For an AGPE using renewable sources, up to 1 MW, Resolución CREG 174 de 2021, in its article 25 as amended by 101 072 de 2025, recognises surplus up to the amount imported in the period as an energy credit; surplus above that is valued hour by hour. And for every kWh that is netted, the retailer charges: up to 100 kW, the retailing component; between 100 kW and 1 MW, the sum of transmission, distribution, retailing, losses and constraints. In other words, on a plant above 100 kW a kWh returned to the grid as a credit recovers, in essence, the energy-purchase component, not the full unit cost.

A reading rule follows: the more of the consumption happens while the sun is up, the more each kWh from the plant is worth. A company with concentrated daytime consumption comes close to the best case; one with night or weekend consumption does not.

What does not go down with the plant is the fixed component, which is charged per bill and does not depend on consumption; the items unrelated to energy, such as street lighting, waste collection or financing; and, depending on the case, reactive energy. A proposal that promises a percentage of the total bill without having seen this breakdown is oversimplifying.

With these documents a serious installer can size on data and not on a hunch. Almost all are requested from the retailer or found in its customer portal.

With the documents above, the calculation is arithmetic. What comes out is not a promise of savings but the reference against which any proposal is measured.

The first is evaluating with a published tariff and not with the one on the bill itself: voltage level and the levy make two similar companies pay different prices per kWh.

The second is assuming the industrial company already has the exemption. The bill is the proof: if an industrial company that meets the requirements sees the levy line, the exemption is not applied, and so it has not been requested or has not been granted.

The third is forgetting that the exemption can change. A project with a payback of ten or fifteen years must withstand the scenario in which the 20% is paid; if it works only with the exemption, it is a fragile project.

The fourth is not looking at reactive energy until after installation. Measuring it beforehand costs little; discovering it on the first bill with the plant running costs an argument with the installer and the retailer.

The fifth is mixing kWh consumed with kWh usable. Large night-time consumption is not like large daytime consumption, and the plant only really offsets the second.