A MESSAGE FROM YOUR GENERAL MANAGER/CEO

GARY RAYBON

Winter Storm 2021: How Will It Affect Your Electricity Bill?

We have received many inquiries on how the winter storm and resulting ERCOT mandated rotating outages will affect our members’ electricity bills. Unfortunately, there will be some effect and bills will more than likely be higher in the coming months. However, this is where being a member of an electric cooperative has its advantages.

WCEC is a distribution cooperative. This means we only distribute electricity; we do not produce it. We are a member of a generation and transmission cooperative, South Texas Electric Cooperative (STEC). STEC produces the electricity that we purchase for and distribute to our members.

Under normal circumstances, STEC produces or has firm contracts for the power to meet the needs of their distribution cooperatives. However, they are required to be a part of the statewide grid which is managed by the Electric Reliability Council of Texas (ERCOT). When STEC’s generation ability is lower than the demand or if it is more economical to buy energy rather than run its own resources, they have the ability to purchase power from the statewide market. If STEC is capable of generating more than the Cooperative members need, they can sell the excess into the market. Even if STEC were not required to be a part of ERCOT, there are many advantages to doing so. Being a part of the statewide grid ensures that any failures or issues in STEC’s generation fleet can be covered by the market. The downside is that even though STEC had more than enough generation to serve their members during the freeze, they were required to participate in the rotating outages to keep the grid stable.

STEC’s owned and contracted resources may very well be the saving grace for our members here at WCEC and those across STEC’s service territory.

We do expect a higher than normal power cost for our February wholesale power bill from STEC. As of February 22, 2021, STEC has not been able to estimate how much higher. We do know that during the freeze, STEC provided all the power needed to its members. This will insulate us from the high bills we are hearing about on the news. The higher-than-normal cost that we will see from STEC will be the result of exorbitant natural gas prices that STEC was paying during the event. During the freeze, natural gas costs rose as high as $400.00 per MMBTU versus the normal $3.00 per MMBTU. As a cooperative, we cannot absorb this spike in energy cost. However, through Power Cost Recovery Factor (PCRF), we can spread it out over the coming months.

PCRF is a part of WCEC’s rate structure that is a direct reflection of the fluctuating cost of fuel required to run an electric generation plant. When fuel prices rise, it costs STEC more to produce power, and those costs are passed through to WCEC members through the PCRF. Although WCEC’s rates have not changed, the PCRF is always fluctuating. To minimize the impact of this charge on our members, every attempt is made to “level” the PCRF every month.

Rest assured WCEC leadership and the board of directors will be doing everything in their power to minimize the impact of this unprecedented event on our members. As we receive concrete numbers for the wholesale power costs, we will keep our members informed of the long-term effects of this event.

With that being said, the electricity bill that you will receive on or about March 1, will be higher as a direct reflection of increased energy use during the cold weather. The PCRF has not been affected yet. As a matter of fact, the PCRF for this bill will be the exact same as the January 2021 and the February 2020 bills.

The average residential use over the last five Februarys has been 1,286 kWh per account. The 3-day freeze in January 2018 resulted in an average use increase of 36%. In comparison, most of our service territory experienced below freezing, often record-breaking, temperatures over a span of 8 days. This will result in higher-than-average bills.

WCEC offers many ways for our members to monitor their energy use on a daily basis. The easiest way is to download our SmartHub app. Daily use can also be viewed through SmartHub on our website.

At this time, WCEC will be waiving all late fees and pausing all disconnects on delinquent accounts that are a result of the winter storm. Please keep in mind that we cannot forgive or waive your electricity bill. We will do all that we can to make payment arrangements or find help for those that may need it. Please call our office at 979-543-6271 to discuss your account with our staff if you will be unable to make a timely payment.

As a cooperative member, all of us at WCEC work for you. We are led by a board of directors that are elected by you. WCEC is a not-for-profit electric cooperative. Our revenue goes directly into the improvement of our electrical system to keep our service reliable or back to our members in the form of capital credits.

As we move forward and begin to recover, know that WCEC will do all that we can to make any hardships felt by our members more bearable.

If you have any questions, our staff is more than happy to help you Monday – Friday from 7:30 a.m. – 4:30 p.m. at 979-543-6271.