Contact: NOVEC Public Relations, 1-888-335-0500, customerservice@novec.com
NORTHERN VIRGINIA—Northern Virginia Electric Cooperative customer-owners are now paying less for electricity than they were in recent years because of a 2011 rate reduction, coupled with a power cost adjustment (PCA) credit they are receiving in 2012. American residential consumers who receive power from investor-owned utilities paid on average $125 for 1,000 kilowatt-hours (kWh) of electricity in January 2012 while NOVEC customers paid $119.24.
As NOVEC’s bills head downward, electricity costs for most Americans are climbing. Although electricity costs vary across the nation, the Energy Information Administration reports that power for the average American has increased every year in the past five years.
Energy experts say costs have gone up across the nation for two reasons: First, consumers are using more electricity to air condition their homes and power a multitude of electronics, including computers, big-screen televisions, and DVR players. Secondly, generation and transmission utilities are replacing old coal-burning power plants with newer plants. Because new plants must meet stringent, federally mandated environmental regulations, they cost more to build and operate.
NOVEC uses short- and long-term contracts to purchase power from a number of sources. In 2013, the Co-op will add almost 50 more megawatts of “green” electricity to its power mix when a biomass plant it is building in Southside Virginia comes on line. The plant will meet all environmental standards -- yet keep power costs competitive.
How did NOVEC lower its costs?
“We ended our long-time power supply contract at the end of 2008 in an effort to stabilize wholesale power costs,” explains Stan Feuerberg, NOVEC president and CEO. “Costs had spiraled upward by 60 percent in six years and we wanted to drive them downward for our customer-owners.”
With lower power costs, NOVEC sought a rate decrease and a fee modification in 2010. The Virginia State Corporation Commission approved the request in 2011 and the Co-op reduced residential rates by 4.5 percent and commercial rates by 8.5 percent. Feuerberg acknowledges that utilities rarely ask for a rate decrease. He said, “NOVEC’s ability to maintain such a strong financial footing during the worst economic downturn in decades has resulted from cost-containment initiatives by the Cooperative’s management, and the extraordinary skill and dedication of NOVEC’s employees.”
NOVEC Customers Receive Power Cost Adjustment Credits in 2012
The SCC approved the Co-op’s request to give customers a credit of a little more than one cent for every kilowatt-hour of electricity a residential customer consumes in 2012. Therefore, a customer who used 1,000 kWh of electricity in February, for example, had $10.66 subtracted from his or her bill.
Feuerberg said, “As a not-for-profit cooperative, we’re constantly looking for opportunities to lower costs. On the heels of lowering our overall rates last year, our team has taken advantage of favorable energy-market conditions. Achieving a lower PCA charge is a positive result and good news for our customers.”
