PEC saving more than $2.5 million through innovative wind power contract
Saving more than $200,000 per month
PEC announced it has been saving more than $200,000 per month through an innovative short-term wind contract which began this past July.
Typical wind power contracts have durations of 10 to 20 years; however, increased wind power in the Electric Reliability Council of Texas market has improved competition and put significant downward pressure on electricity prices. By leveraging the cooperative’s buying power and flexibility, PEC was able to establish a favorable one-year agreement with American Electric Power for a share of the production of the Trent Mesa Wind Farm, up to 50 megawatts (MW) of power.
Power cost is by far the cooperative’s single largest expense at 51 percent of total revenue, and that means it can provide the greatest opportunity for savings. As a nonprofit cooperative, PEC passes decreases in the price of power directly through to its members via the base power cost and power cost adjustment. The cooperative has implemented seven consecutive power price decreases since November 2014.
About 80 percent of the power PEC delivers is generated by the Lower Colorado River Authority from a diversified portfolio of coal, gas, wind and hydro power. The remaining 20 percent is purchased directly from other suppliers. In addition to the most current Trent Mesa Wind Farm agreement, PEC has a 50-MW contract with South Trent Wind Farm.