For November and December, members of Clay Electric Co-op who use 1,000 kilowatt hours of electricity will see their power bill decrease by $3.50.
Last month, the co-op charged $116.80 for 1,000 kilowatt hours of electricity. This month, thanks to a lower Power Cost Adjustment, the cost will drop to $113.30, a savings of $3.50. The PCA decreased from 0.0235 to 0.0200.
This is the third decrease in the cost of power for Clay members this year. The first decrease occurred in July and the second occurred in September. The total decrease for the year is $9.60.
“We’re pleased to have been able to lower the cost of power three times this year,” explained General Manager/CEO Ricky Davis.
With this month’s drop in the PCA, Clay Electric’s cost for 1,000 kWh is the second lowest rate among the 15 electric cooperatives in Florida. Clay Electric is also lower than many of its neighboring utilities.
WHAT IS A POWER COST ADJUSTMENT?
Electric utilities commonly use a Power Cost Adjustment to help them recover a portion of their wholesale energy costs that aren’t covered in their base rates. The Florida Public Service Commission authorized utilities to use a Power Cost Adjustment following the Arab Oil Embargo in the early 1970s. Back then, utilities relied more heavily on oil for power generation.
Clay Electric’s base energy rates are designed to recover an estimated amount of power cost each month. However, because generating costs fluctuate, the amount Clay pays Seminole Electric Co-op (Clay’s wholesale power provider) may be greater or less than the estimated cost Clay’s base rates are designed to capture. Because the actual power cost each month is different from the base rate, the power cost adjustment (PCA) helps Clay collect the difference.