Starting January 1st, 2025 (for February bill statement), Todd-Wadena Electric Cooperative (TWEC) members will see a Power Cost Adjustment (PCA) on their monthly bills. This adjustment ensures TWEC can manage fluctuations in wholesale power costs from its suppliers, Great River Energy (GRE) and the Western Area Power Administration (WAPA). As we approach implementation, we’d like to provide additional clarity on how the PCA works and offer tips to help members manage their energy use effectively.
How the PCA is Calculated
The PCA is designed to account for increases in power costs while maintaining the cooperative’s financial stability.
The PCA is calculated in two parts:
- Annual Cost Increases: This component addresses projected annual power cost increases from GRE and WAPA, ensuring TWEC can meet its financial obligations without raising base rates. For 2025, general service members will see an additional PCA charge that will fluctuate based on their monthly usage. Members with more usage will see a higher charge, whereby, members with less usage will see a lesser charge. On average (based on average usage) a member will see a 4% increase in their bill or roughly $6.60 per month.
- Monthly Power Cost Variations: GRE’s actual power purchase costs can fluctuate monthly due to market conditions, fuel prices, and other variables. This component of the PCA may result in either a charge or credit on your bill based on what GRE either passes through as a charge or a credit.
The two components that make up the calculation of the PCA will appear as one line item on your bill. This will fluctuate monthly. This will go into affect for January usage—you will first see the PCA on your February billing statement.
Frequently Asked Questions
Q: Why not increase the base rate instead of adding a PCA?
A: The PCA provides flexibility to adjust costs dynamically based on actual expenses, ensuring fairness to members and avoiding overcharging during months with lower costs.
Q: Will the PCA always be a charge?
A: Not necessarily. If GRE’s power purchase costs decrease, the monthly PCA component may result in a credit on your bill.
Q: How can I see the PCA on my bill?
A: Both components of the calculated PCA will appear as a combined line item on your monthly statement.
Q: What steps is TWEC taking to reduce costs?
A: TWEC is actively managing our controllable expenses, investing in efficient infrastructure, and advocating for stable power supply costs with our wholesale suppliers.
Energy Efficiency Tips
To help manage energy costs and reduce the impact of the PCA, consider these energy-saving strategies:
- Use Energy-Efficient Appliances: Look for ENERGY STAR®-rated appliances that consume less electricity.
- Seal Drafts: Prevent heat loss in the winter by sealing windows and doors.
- Adjust Your Thermostat: Lowering your thermostat by a few degrees in winter or raising it in summer can significantly reduce energy consumption.
- Switch to LED Bulbs: Replace traditional incandescent bulbs with energy-efficient LED lighting.
- Use Smart Power Strips: Eliminate “phantom loads” by using smart power strips to turn off electronics when not in use.
