Power Cost Recovery Factor (PCRF)
Understanding the Power Cost Recovery Factor
Lamar Electric Co-Op is a not-for-profit electric utility. We’re committed to delivering reliable, cost-effective power to our consumer-members.
Lamar Electric purchases electricity each month, at a wholesale cost to meet the needs of our members. The cost of wholesale power is a significant expense of providing electric service to the homes and businesses we locally serve.
What is the PCRF?
You may have noticed the Power Cost Recovery Factor (PCRF) line item on your monthly bill. The PCRF provides a monthly adjustment dependent on any differences in the base cost of wholesale power.
If the kilowatt-hour cost to Lamar Electric is lower than the base cost of power, the PCRF is applied as a credit on your bill. If the kilowatt-hour cost is higher than the base cost of power, the PCRF is applied as a charge. Having the PCRF benefits members by covering monthly power cost fluctuations without having to continually restructure electricity rates.
What impacts the PCRF?
The PCRF changes based on the cost of wholesale power, which fluctuates for a variety of reasons. During hot summer months when the demand for electricity is much higher, power may need to be purchased from more expensive sources at market price, which includes additional generation costs. Increased costs for fuels like natural gas also impact the price of wholesale power.
What is Lamar Electric doing to help?
We know times are tough as the cost of gasoline, groceries and other essential needs are rising. Lamar Electric is doing everything possible to keep internal costs down, but we can’t control rising fuel costs that are impacting the country.
Lamar Electric uses a diverse mix of fuel sources for electricity, which helps reduce costs. Last year, our electricity was generated from coal, natural gas, nuclear, solar, hydro and wind. This balanced fuel mix helps reduce dramatic fluctuations in generation costs.
We’re here to help. Contact us if you have questions about your bill or ways to save energy.
