What is a Power Cost Adjustment?
Power Cost Adjustment (PCA) - sometimes called the Energy Cost Adjustment (ECA) or Fuel Cost Adjustment (FCA).
Since the PCA changes from month to month, it is important to realize that it is not due to a change in your electric rates, but due to the changing costs of the fuel used to generate the electricity that you use. Some of your electricity is generated by burning coal or natural gas, and the cost of these fuels changes on a monthly basis. The PCA item on your bill passes these costs on to you. The electric utility does not make any extra revenue from this item - it is a pass-through cost.
When your electric rates were established, estimates were included for the cost of fuel used to generate the electricity. However, in the past few years, supply and demand issues have affected the cost of electricity generated by coal and natural gas. The railroads have increased the costs of delivering coal to power plants through diesel-fuel adders, and natural gas prices continue to be volatile. As a result, the PCA has changed from month to month to cover theses costs.
All electric customers in Oklahoma have been paying a PCA in their bills for many years.
To summarize, the PCA:
In the past we were able to absorb the baseline cost of .023 per kilowatt and just pass on to the customer the PCA adjustment set by GRDA. The PCA is based upon a baseline cost of .023 per kilowatt plus or minus the monthly adjustment set by GRDA.
-Is not a change in rates.
-Does not make extra revenues for your city.
-Goes up or down from month to month
-Covers the monthly change in the cost of fuel that is used to generate some of your electricity.