Dear MVEC Members,
February’s winter storm that left millions of Texans without power was undoubtedly a historical weather event, wreaking havoc on the Texas’ power grid operator, the Electric Reliability Council of Texas, (ERCOT). As many of us have our power restored in our homes and businesses, we understand this event will bring up questions and concerns about potential spikes in energy prices.
If you’ve been a Magic Valley Electric Cooperative (MVEC) member for some time, you know that we value honesty and transparency with our members. While we can’t provide members with an exact forecast of the market’s electricity rates, here’s what we can tell you: Many statewide retail electricity providers will face challenges over the next several weeks, at varying degrees, based on their pricing structures and how they purchase their power. These challenges range from drastic rate spikes to possible bankruptcy.
MVEC is in a better position than many. We contract our power with South Texas Electric Co-op (STEC) who takes proactive steps to actively manage and offset high market costs and limits the impacts of market price spikes like we experienced this week.
From the beginning of this event, our generation and transmission provider, STEC, took steps to attempt to limit the impacts of the market price spikes for our members. While market prices were extremely high, STEC had to buy some of this power off the market, but STEC also had the chance to sell some power at the high prices to offset some of those high costs.
What does this mean for our members? First and foremost, please know that our rates for March have not changed. We will continue to have the same energy rate and power cost recovery factor (PCRF) as we did in February. That being said, member data shows that, due to record low temperatures, some members used more power. With the extra usage from heating systems, some members even doubled their daily average usage. On average, an HVAC system with electric heat strip will consume approximately three times more energy to heat a home than it does to cool a home. As a result of the high usage, MVEC anticipates that members should expect to see higher electricity bills. We would like our members to know that we don’t expect a drastic spike in rates like the media has been reporting or other providers may be predicting for their customers. As always, we will work with our members to assist with bill payments and support you however we can. As a co-op, we are always looking out for your best interests. Moving forward, we are committed to taking an active seat at the table to affect change and minimize impacts like this for our members in the future.
If you have any questions, please feel free to contact me.