A Note From The CEO/General Manager |
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Dear Member -
Effective July 1, the PCRF will increase from .055¢ per kWh to .0575¢ per kWh. The PCRF will continue to be fluid as we will likely experience further changes in power cost.
Below, in detail, are the open and honest facts. But I want to take this opportunity to tell you that we remain committed to providing reliable service to you at the most reasonable rates we can. And we want to offer support to those members that are struggling, where we can. We appreciate our members, and we understand the challenges of these higher costs.
If, after reading the below, you have further questions, we invite you to send an email
to [email protected]. Please include your account number, and the way you'd like to be reached.
In Your Service,
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WCEC Strives to be Good Stewards of Members Dollars
We will always be as transparent as possible. We'll also always do what we can to control cost in areas where we have influence. In addition to elevated power costs, we are also paying more for poles, wire, meters, and the multitude of parts and equipment that it takes to serve our members. Despite it all, we are working hard to control costs where we can, and our numbers prove it. The graph below shows the makeup of our current operating expenses with the bulk of those going to pay for power.
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Power Cost Recovery Factor (PCRF)
In our rates, as well as other utilities' rates, there is structure to help with fluctuating power cost driven by fuel cost. This method of power cost recovery is the norm in the electric industry where it may be called by a variety of names (fuel adjustment, power cost adjustment, fuel factor). The sole purpose is to handle fluctuations in power cost.
When the costs of natural gas and coal, the fuels, change, the PCRF manages those fluctuations. As a non-profit cooperative, WCEC does not make any money on this and there is no cost markup on fuel. The PCRF charge is a direct pass through. More information regarding the PCRF is described here on wcec.org.
The Outlook
All indications are that higher power cost will continue until the spring of 2024 at least. This comes at a time when inflationary pressures are squeezing members pocketbooks from every side. All of us are paying more for food, clothing and every necessity and luxury. Much of the costs increases for all of those can be attributed, in great part, to high fuel prices.
In addition to high gasoline and diesel prices, fuels like coal and natural gas have sharply increased. This directly impacts electricity prices because the bulk of electricity is generated using these fuels.
Here's a chart from the U.S. Bureau of Labor Statistics to illustrate cost rises, and specifically what is happening in the energy industry. The energy index (gas, fuel, oil and energy services) rose 34.69% over the last year. Drilling down within that category their charts show that on average electricity has seen a 12% increase.
12-month Percentage Change, Consumer Price Index (***)
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Our power comes from a variety of resources through long term contracts as well as partial ownership of generation facilities via our two non-profit generation and transmission cooperatives. These G&T’s work on behalf of 10 distribution cooperatives in east Texas.
Importantly, we do not just rely on coal and natural gas only for our generation. We have a diversified fuel mix that also features renewables where they are practical, affordable and dependable. But renewable energy only comes when the sun is shining, the wind is blowing, and the rivers are flowing – which are not always. And, not usually during the times of peak energy demand. Until affordable energy storage options come about for renewables, coal and natural gas will remain predominant fuels sources.
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How WCEC Compares
Using the Power to Choose website, The Dallas Morning News recently calculated that retail electricity prices for Texans have risen from .1119 ¢ per kWh in January to .1848 ¢ per kWh in June. This includes the base rates that each have. Adding in our Rate A base of $17.00, WCEC's charge per kWh is .14117¢, which is well under the average. That's because we do not have to please stockholders with profits. We only answer to our members, and we work hard for each of you to keep cost as reasonable as possible while providing reliable service.
We must continue to make financially sound decisions for the benefit of our entire membership. At this time, we can't say how long we expect higher power cost. Here's a historical look at our PCRF, and how it has impacted bills for our Rate A members. In all, it has increased .0225¢ per kWh, which equates to $22.50 per 1,000 kWh, since April of 2021.
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In Summary
Our financial focus is driven by our mission to minimize costs for the members we serve. We know every single increase impacts strained budgets, and we remain mindful of it.
If you are struggling, we want to help. Our member services agents can talk with you about your individual situation. There may be helpful conservation measures, billing plans, or outside programs that you've not considered. We can help you analyze your specific needs and situation.
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Energy Efficiency Tip of the Month |
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The key to keeping your bill low - now more than ever - is to use less kilowatts. There are ways for almost anyone to save. But, the number one contributor to a high bill is usually the way someone chooses to heat and cool, and the temperature their thermostat is set on.
If your home is not well insulated, heated or cooled air cool air can slip out through cracks, and your HVAC must continue to work to keep the thermostat setting. Proper insulation, and sealing cracks with caulk and weather stripping can pay dividends.
Lighting and appliances account for about 33% of an electric bill. Water heating also contributes to about 18% of a consumer's bill. Setting your water heater at 120 degrees or below, can save energy and money.
High Bill Help
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Wood County Electric Cooperative | 903-763-2203 | www.wcec.org |
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