Monitor Editor
KEYSTONE HEIGHTS— Clay Electric Cooperative said that due to the rising costs of generating power and other expenses, it is raising the price of power to its members.
Customers will see an increase to their power cost adjustment in December, and an increase to the co-op’s access charge the following month.
For most Clay Electric members, their bills consist of an energy charge, an access charge, a power cost adjustment, taxes and a contribution to the co-op’s Operation Round Up.
Power cost adjustment
In a news release, the co-op said members will see the first price increase in their power cost adjustment line item.
In order to change their base rates, utilities have to get approval from Florida’s Public Service Commission.
In response to the 1973 Arab Oil Embargo, the commission allowed utilities to adjust their power cost adjustments without seeking state approval for each individual change.
The co-op said that the power cost adjustment was to take place in November but was delayed due to billing system issues.
“Members using the industry household average of 1,000 kWh of power will pay $115.90, a $4 increase,” the co-op said. “The previous cost was $111.90 and took effect in January 2021.”
The actual amount each member pays each month will vary based on how much electricity is used.
Clay Electric said the price of natural gas, which the co-op’s power supplier uses to generate power, has increased 100 percent this year.
“The co-op’s cost of wholesale power is now more than 70% of Clay’s total expenses,” it said, “so it’s critical the co-op makes sure it recovers all of its wholesale power costs in its retail sales.”
Clay Electric General Manager/CEO Ricky Davis said the increase in fuel and commodity prices are projected to increase electric generation costs more than $7 million for the co-op in 2021.
“We work hard to maintain our costs and provide affordable electricity, but these large fuel increases to generate power make this rate change unavoidable,” Davis said. “This will be the first increase in the power cost adjustment since 2018 due to historically stable coal and natural gas prices.”
Access charge
In addition to the December power cost adjustment increase, the co-op said it is increasing its access charge in January.
“A recent rate study indicated the cooperative should increase its access charge to approximately $30 per month to recoup more of the fixed costs associated with building and maintaining its distribution system,” the co-op said. “The Clay Electric board of trustees voted to increase the access charge by $4 per month.”
The new monthly access charge will be $27, beginning in January, making the cost for 1,000 kWh $119.90. The access charge was last increased in 2018.
“Despite this rate increase, the cost of electricity remains a great value considering all the ways we depend on it,” Davis said. “Over the last five years, the cost of rent increased 3.4%; medical care increased 2.8%; and education increased 2.2% nationwide. But the cost of electricity only increased 1%.”
In the news release, the co-op also reminded its members that they receive an annual capital credits refund based on the amount each member was billed for electricity during the year.
“In 2020 alone, $24 million in capital credits was returned to members in two disbursements,” the co-op said.
