The Ocala City Council approved a Summer Relief Credit to reduce electric bills for customers this summer.
During the city council’s general meeting last week, Michael Poucher, the director of Electric Utility at Ocala Utility Services, briefed members about $4 million in over-collected funds that had carried over from the previous fiscal period.
Poucher explained that if the city were to keep the current power cost adjustment (PCA) rate of $0.21, an additional $2 million would be over-collected, bringing the total to $6 million.
The PCA rate is a mechanism by which fluctuations of the cost of power are passed through to customers. To address the over-collection, staff recommended issuing a credit of $0.04 per kWh to each customer and reducing the PCA rate from $0.21 per kWh to $0.17 per kWh.
The change is set to go into effect on July 1, 2019 and will be in place for the remainder of the fiscal year.
During the months of August and September, city staff will provide council members with the projected costs for the upcoming fiscal year and the feasibility of maintaining the reduced rate. Currently, the rate stabilization fund is fully funded at 25% of projected fuel costs.
According to the city, the Summer Relief Credit should produce a 19% decrease to the PCA rate, or an average 3.6% reduction to the overall electric rate. For the average residential customer, this would decrease their overall electric costs approximately $4.00 per month. For a commercial/industrial customer, the average rate decrease should be 3.6% as well.