April Power Cost Adjustment

The City of Monett Utility Department would like to alert customers that the Power Cost Adjustment (PCA) for the upcoming billing will once again be higher than average at $0.03560 per kilowatt hour. The PCA for the March billing  cycle was $0.03109 per kilowatt hour.

The PCA remains high this month because natural gas prices continue to be low, and the city’s main piece of the power is Plum Point which is generated through coal. With natural gas prices so low, coal isn’t getting called on in the market and we are paying higher prices.  As the weather warms up and usage increases, our prices are expected to decrease.

City of Monett Utilities recognizes that the increased PCA is a burden to many residents and is actively exporing options to reduce the adjustment. The City’s five-year contract for energy supply will be up in June of 2025, and Utilities Staff is working diligently to diversify its power sources and find power closer to home to try to save costs and work to protect ourselves from larger cost shifts from month to month.

Those who many need energy assistance, may find resources here: Monett, MO (revize.com)

 

The Avoided Fuel Cost for April is $0.0245. This is the rate for solar customers that produce more than they use for the month.  That amount is credited back to their account on a month they use more energy than they produce.

The City of Monett, through its purchasing group, the Southwest Power Pool, which also includes Mt. Vernon and Lockwood, rents a share of the power produced by Plum Point and some other power generating facilities in the region through and agreement with Liberty. The Southwest Power Pool has requirements that each member carry a required amount of capacity, which is a certain percentage above the community’s maximum load. Liberty currently guarantees that capacity to the city. 

When the city’s share of power generation exceeds the community’s use, the city can sell it back to the grid to help offset power costs for residents. Likewise, if the community uses more power than generated by its share of the plants, Monett purchases electricity to make up the difference.

The PCA is a formula that is applied each month to ensure the large fluctuations that are typical of the buying and selling of electricity have a minimal impact on residents. However, in some situations, like when power use is unexpectedly low or other sources of power, like natural gas, wind or solar, becomes cheaper or more readily available, the demand for the city’s excess electricity decreases, meaning the city sees a lower-than-expected return on those sales.

In March, the city experienced both lower-than-expected demand, as well as unusually low natural gas prices, which further drove down the sale price for power.

With the city’s contract for energy supply set to expire next year, the city is looking at ways to diversify its power portfolio, which will help stabilize the fluctuations in the PCA in similar circumstances in the future.