Paducah Power Not Raising PCA for Next Fiscal Year

Paducah Power System will use available cash to prevent an increase in the utility’s Power Cost Adjustment. 

At their Monday meeting, the PPS Board of Directors approved a budget for the new fiscal year that will keep the PCA at $0.00997, starting July 1. The board’s action means that residential customers will pay a total kilowatt hour rate of 12.15 cents, the same rate they’ve paid for the past year.

The PCA, which affects residential and commercial accounts, is a billing practice used by utilities to collect enough revenue to recover wholesale power costs without changing their base rates every month. Since February 2014, Paducah Power's board and management have dropped the PCA by 72 percent, lowering the monthly bill for the average residential customer by 16 percent. 

However, PPS General Manager Dave Carroll said they can't lower the PCA again because of current market pressures.

“The expiration date for the savings we’ve been able to achieve to date with short-term solutions is getting closer,” Carroll said. “We can use available cash to prevent an increase in the PCA next month, but a long-term solution to our power supply issues is necessary to achieve a significant rate reduction.”

At their meeting, the board also approved quarterly reviews of the PCA instead of an annual review. This will help PCA to be more responsive to changes in power costs, minimizing overcollections or under collections.