The cost-of-service study is a professional study used to determine the actual cost to provide electric service to our members. The study reviews the current rate design to see if costs are recovered as they are incurred.
As with any organization or business, there are fixed costs and variable costs. It is important that fixed costs are recovered through fixed charges (your basic monthly service charge) and variable costs (like energy use) are recovered through the energy charges on the monthly bill.
Our January issue, along with our social media outlets, will break down the minor revision of rates.
“The recent cost-of-service study validates the hard work done by the board and employees of PPEC. The study shows our rates are performing well, and there is a need for only minor changes. We are working on developing our budget for 2018 and are expecting only minor rate changes of less than three percent overall. This will be the first rate revision in nearly four years, which shows the cooperative’s dedication to keeping rates low, competitive, and fair for all members.”
“It is very important for the board to see that all members are treated fairly. The cost-of-service study is a tool where we can see exactly how members are being billed and if all members are treated fairly in the rate design. It is good to know that even though we are a not-for-profit corporation, this study is done exactly like it would be for a regulated, for-profit corporation.”