For the third consecutive month, Texas public power utility Austin Energy is reducing customers’ bills.
The utility is again reducing the Power Supply Adjustment, which reflects wholesale power market costs and for a typical customer makes up about half of their total electric bill.
Effective December 1, the PSA rate will be 15% lower compared to the rate in effect earlier this year. For a typical customer using 860 kWh per month, this reduction will translate into an estimated $6.53 savings on their monthly electric bill.
The PSA operates as a dollar-for-dollar recovery mechanism, meaning the costs and savings are passed directly to customers without any markup added. The recent reductions come after making up a $110 million deficit in PSA costs a year ahead of schedule. The deficit has been fully recovered because of lower power supply costs experienced by Austin Energy within the Electric Reliability Council of Texas (ERCOT) market over the past year.
“Austin Energy is doing everything we can to pass savings to our community and continue having some of the lowest energy bills in the state,” said Austin Energy General Manager Bob Kahn. “Our recent PSA decreases reflect careful planning and an analysis of both historical and forward-looking market conditions. We will continue to monitor costs closely and remain prepared to make additional reductions when appropriate.”
Although the market has improved, the utility remains cautious because long-term trends in wholesale power prices still pose risks. Issues like transmission congestion, renewable energy limits and the need for enough power generation in Austin Energy's area could affect future power supply costs.
