What is the Power Cost Adjustment (PCA)?
The PCA is a separate line item on each North West REC (NWREC) electric bill which reflects the increases/decreases in the Cooperative’s cost of power purchased wholesale from Northwest Iowa Power Cooperative (NIPCO). The cost of the purchased power now represents over 80% of your Cooperative’s operating expenses. NWREC has been using the PCA since April, 2010, due to the monthly and annual fluctuations we are seeing in purchased power costs. It is a method of either collecting from or returning to the members the difference in wholesale purchased power costs compared to the base wholesale rate that was used to establish the current electric rate.
NWREC’s electric rates were adjusted effective June 1, 2015. With this rate adjustment, we incorporated the revenue that we had been receiving through the PCA into the rate components and “zeroed” out the PCA. The PCA factor for 2017 will be 1 mill (1/10 of a cent) per kilowatt hour.