SRP’s Board of Directors has approved an overall average 3.7 percent decrease in electricity prices for the two hottest months of this year.
The decrease will save the typical residential customer about $7.60 per month, or about a combined $15.20 for the July and August billing cycles, according to a press release.
SRP’s publicly elected board made the decision during a special meeting June 23.
The temporary reduction will take effect with the July 2016 billing cycle. Prices will return to the original summer season price approved in 2015 for the September 2016 billing cycle.
The temporary reduction is possible because SRP has been able to reduce expenses in two components of its electric prices, the release stated.
The first is what’s known as the Fuel and Purchased Power Adjustment Mechanism, or FPPAM, which recovers fuel costs incurred to generate electricity, as well as power purchases to serve customer needs. Savings in this area are primarily because of lower-than-anticipated natural gas costs.
The second is the Environmental Programs Cost Adjustment Factor, or EPCAF, which involves costs related to renewable energy and energy-efficiency programs adopted to meet SRP’s sustainable portfolio standard. The temporary reduction reflects SRP’s ability to meet its sustainable goals at a lower-than-expected cost to customers.
The costs of these two components to SRP are directly passed through to customers without any markup, the release stated.
According to SRP Chief Executive Officer and General Manager Mark Bonsall, management elected to propose reducing prices during the July/August time frame because a decrease in the two hottest months of the year could provide relief for residential customers when it is needed most.
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