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The "PCA"
In recent years, the part of your electric bill called the PCA has caused concern and has prompted many questions.
The PCA, also called a "power cost adjustment" or "purchased commodity adjustment", is a means by which the price charged for electricity is adjusted to correspond with the costs that the City incurs to acquire and provide electric service. Just the same as the price of equity stocks, gasoline or milk can change, so can the price of fuel used to generate electricity and the price of electricity bought from others on the commodity market. The monthly rates of all area utilities are based upon certain expected costs at the time the rate was enacted. The difference between these costs and the actual costs at the time the electricity is used by customers is charged by the various utilities as a PCA, a "fuel cost recovery" charge or "wholesale adjustment", among other names. Without the use of these adjustments, there would be constant rewriting of rates and constant confusion.
During 2007 and early-mid 2008, Covington's PCA became rather high but declined in late 2008 as the costs paid for electricity to our wholesale providers went down. In December of 2008, costs had declined to the point that no electric PCA was charged for bills sent out in that month, making for a nice Christmas present during an expensive time of the year.
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