Clay Electric hikes rates for second straight month, imposing a ‘substantial’ increase

Don Johnson

Clay Electric has announced it will increase rates for a second straight month as it faces a nearly $20 million budget shortfall for the fourth quarter due to a volatile natural gas market.

Clay Electric said it will impose a “substantial rate increase” beginning with October billing cycles.

The Power Cost Adjustment (PCA) is increasing $19.60 per 1,000 kilowatt (kWh) of energy that a customer consumes. Customers who use the industry standard household average of 1,000 kilowatts of power will now pay $159.50. That amount is almost a $20 increase when compared to this month's billing cycles.

With September billing cycles, customers using the industry household average of 1,000 kWh of power paid $139.90. That was an increase of $5 compared to the previous month.

The additional amount each customer pays each month will vary based on how much electricity is used.

Clay Electric has now raised its rates an unprecedented six times in less than a year.

The PCA increases or decreases each month depending on the costs to generate power. Current and forecast natural gas prices are quadruple what they were in 2020, and roughly triple from 2021 due to domestic conditions and international events, according to a Clay Electric press release.

Overall demand for natural gas this year has exceeded supply, in part due to low coal inventories, extreme summer weather and low storage inventories.

“Clay Electric has never seen increases in power costs of this magnitude,” said General Manager/CEO Ricky Davis. “These increases have put our energy costs $65 million over budget this year. The most recent increase was $19.8 million, which is why we must take the extraordinary action of raising our PCA $19.60 per 1,000 kWh. Even with this rate increase, we project to end the year with a $4.6 million budget deficit.”

Davis said about 70 percent of the fuel used to generate power in Florida is natural gas, and all utilities are struggling with soaring fuel costs.

Florida Power and Light, Duke Energy, Gainesville Regional Utilities and others have also raised rates this year due to natural gas prices, and plan to again in 2023, the press release said.

“Our staff and the Board do not take these increases lightly,” Davis said. “We will continue to look for ways to lessen the impact on our members. As soon as natural gas prices go down, we will lower our rates.”

Clay Electric offers free energy surveys to help customers find ways to lower their usage and bills, and provides several energy tips, tools and programs at ClayElectric.com. The co-op also works with many organizations in North Florida who provide utility bill payment assistance to members. A list by county of organizations is available here.

Clay Electric has a new PrePaid billing program to help customers who are often behind on their payments or do not want a set due date. PrePaid gives customers the power to pay for electricity on their own schedule – daily, weekly, monthly, or whenever is right for them, the co-op said.

It allows customers to purchase electricity on a pay-as-you-go basis (similar to buying fuel for a vehicle) without deposits, late fees or reconnection fees. Customers with existing deposits on their account will have it applied toward any outstanding balance owed, with the remaining credit (if applicable) applied to the PrePaid account at sign-up.

More information on the PrePaid program is available here.

https://img.particlenews.com/image.php?url=3xIWN3_0iCApQVg00
Clay Electric is increasing rates again.Photo courtesy of Clay Electric Cooperative Facebook page.

Comments / 8

Published by

Veteran journalist with experience in website and newspaper content as an editor and writer. I have worked as a reporter at newspapers and websites in Florida, California and Arkansas. I am a former executive editor at the Tampa Bay Business Journal and worked for 12 years at The Tampa Tribune as an enterprise editor and business editor. At Patch.com, I produced stories for 24 websites in the Tampa Bay area and also edited content for websites in six states.

760 followers

More from Don Johnson

Comments / 0