Why are my electricity costs higher than last year?

Answer: The Coop purchases power from Arizona Electric Power Cooperative (AEPCO) located in Cochise Arizona. AEPCO uses natural gas, coal, and solar to generate electricity. The cost of natural gas and coal is more expensive than last three years. As an example, natural gas costs have been much higher than the low prices we experienced in 2020.

The Coop rates are approved by the Arizona Corporation Commission (ACC). The residential kWh electric rates have not been raised since 2018. There is a mechanism called a power cost adjustor (PCA) is used to pay for the fuel cost to generate electricity. The PCA changes based on the cost of wholesale power, which fluctuates for many reasons. During the hot summer months when the demand for electricity is higher, power may need to be purchased from different sources at market prices. Increased costs for fuels like natural gas and coal also impact the price of wholesale power. The cost of power is adjusted through the PCA cost adjustor which affects your overall utility bills. There are other factors that need to be considered in the year-to-year bill comparisons such as kilowatt usage, temperature, and amount of solar generation in a given month.