2017 Power Cost Adjustment (PCA)
Will be Filed April 14
Idaho Power will file its annual Power Cost Adjustment (PCA) on April 14. The PCA is a price adjustment that passes on both the benefits and costs of supplying energy to Idaho Power customers. It reflects Idaho Power’s anticipated fuel costs for generating electricity, costs of power purchases on the market to meet customer demand and customer benefits from sales of surplus energy for the coming year.
The PCA brings last year’s forecasted costs in balance with actual expenses by looking back at what happened the previous April through March (called a “true-up”), and forward to the coming April through March (the “forecast”). Rates are established based on the forecast and the true-up to try and make that portion of a customer’s rates equal what it actually costs to provide electricity.
Neither Idaho Power nor its shareholders receive any financial return on this filing—money collected from the surcharge can be used only to pay power supply expenses.
With commission approval, Idaho customers’ rates are adjusted each June 1 for the PCA.
Power Generation Sources and the PCA
There has been a lot of snow in Idaho Power’s service area this winter. However, winter snowpack does not guarantee a banner year for hydro power. The magnitude and timing of runoff are still very important factors influencing how much water will be available for summer hydroelectric generation.
While the level of hydroelectric generation that will be available to serve customer demands is yet unknown, there are two known factors that will contribute to higher power costs in the upcoming PCA. First, Idaho Power is paying for energy from several new solar projects that have come online in recent months. The full cost of these new solar projects and the resulting impact on customer prices will be addressed as part of the PCA. Second, increased fuel costs at certain Idaho Power generation facilities will drive overall power costs up in the coming PCA year.
Idaho Power works hard to provide reliable, responsible, fair-priced electric service to its customers. And although rates sometimes change, at the end of the day we still pay some of the lowest prices in the country for electric service.