Press Release, HWL
HWL received an extremely high bill, caused by an increase in fuel cost, from AEP/SWEPCO for the month of February due to the extreme winter weather. HWL was notified a few days prior to receiving our monthly invoice that potentially the bill would be higher, but the amount was much higher than anticipated. SWEPCO did not notify HWL during the event that fuel cost were going to increase from around $0.03/kWh to $0.315/kWh in which case we could have notified our customers and allowed them to make a decision on whether or not they wanted to conserve electricity to help reduce the amount of their electric bills.
SWEPCO cited that the Southwest Power Pool (SPP) experienced extreme weather conditions, so various components of the invoice were higher compared to January’s estimated/preliminary forecast of the February charges. The entire SPP region, the Electric Reliability Council of Texas (ERCOT) and other parts of the Midwest were all impacted by this extreme weather event according to SWEPCO. The wholesale price of natural gas increased as extraordinary winter storms brought record-low temperatures to Arkansas and other surrounding states. They offered to implement a payment plan at a FERC interest rate that is currently 3.25%. HWL could not see how paying that interest rate would benefit our community.
As most customers are aware, there is a component of your electric bill that is the Power Cost Adjustment (PCA). This is a monthly charge that is on the bill each month and applies to all classes of customers and reflects the changes, either increases or decreases, to the total base cost of power and this charge goes on the bill based on your kWh usage. The Hope Water & Light Commission (HWLC) meeting on Wednesday, March 10th was called to discuss the $6,365,509.73 bill (which approximately $5,000,000 was due to the severe weather) and the impact it would have on our customers as it relates to the PCA. It was a unanimous decision of the HWLC to pay the entire bill from funds held in bank accounts and certificates of deposit. It was also decided that HWL would absorb 60% of the $5,000,000 and over a 36 month period customers would pay the remaining 40% through the PCA. In other words, of the $5,000,000, HWL will absorb $3,000,000 and the additional $2,000,000 would be spread out based on kWh usage over 36 months. Customers should see a minimum impact on their electric bill by doing it this way. For a customer that uses 1000 kWh they would see a difference of approximately $10.00 per month. Had the HWLC not decided to do this, customers would have seen an increase of approximately $50 per 1000 kWh of usage.
HWL is concerned about our customers and the impact that a bill of this magnitude would have. The HWLC felt that it was the best possible outcome for all involved to help defray a large portion of the cost. In the meantime, we will not stop until we have exhausted every avenue possible for any relief for our customers with these charges.
If you have questions, concerning this article, please contact HWL and ask for Charlotte Bradley or Russell Cornelius at 870-777-3000.