Due to ever-rising fuel costs needed for the generation of electricity, Central Florida Electric Cooperative will be increasing the Wholesale Power Cost Adjustment (WPCA) from $5.50 to $23 for members beginning in the month of September. Members using the industry household average of 1,000 kWh of power will pay $149.50, a $17.50 increase from the previous 1,000 kWh average of $132.
The additional amount each member pays each month will vary based on the amount of electricity used. The increase in WPCA was approved by the Board of Trustees at the Aug. 22 board meeting as a necessary effort to combat the rising cost of power.
The WPCA is used to “adjust” the amount charged to members when the price of fuels used to generate electricity rise and fall throughout the year. CFEC’s generation cooperative, Seminole Electric, relies on natural gas and other fuel sources to produce the electricity they provide to us and many other distribution co-ops across the state of Florida. Soaring natural gas prices have made electricity more expensive to produce, and therefore, more expensive for CFEC to purchase from Seminole.
When the cost of power from Seminole is greater than the amount included in the CFEC base rate, the WPCA is a charge. When the cost is less, the WPCA is a credit.
The Board of Trustees and management team at CFEC have done their best over the years to protect members from the volatility of fuel markets. Despite the steady rise in price of natural gas in 2021, the Board of Trustees was able to maintain the WPCA as a credit on utility bills. The Board insulated Members from rising fuel costs for as long as possible before having to finally pass the increase in cost on to members with an increase in WPCA in June of this year, making the WPCA an additional charge on the utility bill rather than a credit for the first time since 2011.
“As a not-for-profit electric co-op, we’ve worked really hard over the years to stay on top of natural gas pricing in order to maintain our costs and provide affordable electricity,” Central Florida Electric General Manager/CEO Denny George said. “From my past experience developing natural gas power plants, I always felt I had a good handle on not only the energy markets but specifically natural gas.”
“This current market has been perplexing to keep up with, predict and adjust for,” he said. “We are in desperate need for restoration and reform in our energy policy that works on behalf of fixed income and lower-income Americans. With Seminole Electric having done everything they have been asked to do to improve emissions of power plants, it is sad to see that we are unable to keep prices where they were a year ago – almost 30 percent lower than they will be with this latest increase.”
While this adjustment to the Wholesale Power Cost addresses recent increases in fuel costs and subsequently the cost of power, fuel is not the only commodity necessary for power production and distribution that is facing price pressures. A recent rate study has indicated that members should anticipate an increase to base electric rates and other utility-related charges (or fees) soon as costs associated with materials, equipment and labor continue to climb.
Despite these challenges, the cost of electricity remains a great value considering how greatly we depend on it for daily life, and CFEC remains committed to providing reliable electricity to our members at the most affordable price possible.