Economic forces, such as inflation and supply chain shortages, have increased the cost of everything from groceries to used cars. While Covington Electric Cooperative is doing everything in its power to stabilize the cost of your power, it is necessary for the cooperative to implement another increase in the Power Cost Adjustment (PCA) that will take effect on bills received in September.
This adjustment will result in an additional increase of 7-mills, which brings the PCA total at this time to 23-mills. This equals $23 per 1,000 kWh used.
CEC is not-for-profit, owned and operated by its members. The PCA is implemented to cover higher costs of fuels used to generate electricity, and other increases that are the result of widespread supply chain challenges and inflation.
CEC does not generate power, but instead purchases it from PowerSouth Energy Cooperative. PowerSouth generates power at its plants and facilities. As their costs have increased, so have ours.
One major reason is a sharp spike in natural gas prices, roughly double what they were at the beginning of 2022. PowerSouth has a diverse mix of energy sources with some coal and hydroelectric, but the biggest source now comes from natural gas. Natural gas represents about 87% of PowerSouth’s current energy mix. In stable economic conditions, it is one of the most affordable resources available. Unfortunately, the same economic forces that have driven up the price of milk, coffee and bacon have increased the price of natural gas.
This PCA is also not unique to CEC. For-profit utilities and other electric cooperatives around the country are facing the same issues. However, CEC and PowerSouth are uniquely equipped with several strategies to keep power costs as stable as possible.
PowerSouth has been able to help reduce the effect of fuel price volatility through a robust natural gas risk-management program, limiting otherwise higher cost increases that would occur absent this strategy.
CEC is committed to providing you reliable, affordable power. As a member-owned electric cooperative, we try to make decisions that help our communities, schools and businesses thrive. This PCA adjustment will ensure a safe, dependable energy supply for all members as we move through economic challenges. Please be aware that if the cost of natural gas continues to increase, the price of electricity will also increase.