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SRP to institute price decrease in May


From the April 17, 2013 issue of Public Power Daily

Originally published April 17, 2013

The Salt River Project’s board approved a price decrease April 8 that will reduce customer bills by an overall average of 1.1 percent beginning in May. The pricing plan reduces two components of SRP’s electric prices and will be in effect for the six summer billing months in 2013, saving a typical residential customer about $1.72 per month, the Phoenix-area utility said.

One of the price components covers program costs related to meeting renewable energy and energy-efficiency standards, and complying with environmental mandates, SRP said. The second component recovers fuel costs incurred to generate electricity as well as power purchases to serve customer needs. The costs of those two components are passed directly to the customer and are not marked up, the utility said. They are included in the energy charge amount on the monthly bill. 

The lower-than-expected costs, totaling $20.5 million, resulted from:
  • year-to-date electricity sales to customers that were higher than expected,
  • cost savings from a short-term sale of energy from a geothermal plant,
  • lower-than-anticipated program costs, and
  • lower-than-planned natural gas costs.
The temporary price reduction also reflects SRP’s effort to achieve its sustainable portfolio goals at a lower-than-anticipated cost to customers, the utility said. The SRP board has set a goal to meet 20 percent of SRP’s retail electricity requirements through sustainable resources by the year 2020. SRP said it is ahead of schedule – providing more than 10 percent of retail energy needs with sustainable resources, which include renewable energy, hydro power, conservation, efficiency and pricing measures.

Under a mechanism approved by the board, SRP staff regularly review actual costs and may adjust the associated price components if funds are significantly over-collected or under-collected for the expenses.

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