Transmission Costs

Electric transmission costs have risen more than 100 percent in the past six years. They cost PEC and our members $70.3 million in 2017 alone.

What are transmission costs?

The transmission-cost-of-service (TCOS) charge on your electric bill is the cost of transporting electricity on the statewide transmission system, and it’s based on a value called Four Coincidental Peaks, or 4CP. 4CP is the measure of PEC’s energy use when the statewide transmission system experiences its highest overall 15-minute demand “peak” during each of the four summer months.

What determines transmission costs?

Transmission costs are not set by PEC. They are set by the Public Utility Commission of Texas (PUCT), based on the cooperative’s total energy use during the four, 15-minute peak events. The PUCT measures what portion of the overall grid we’re using during the peak. Our use, compared to the rest of the state’s use, determines PEC’s share of statewide transmission costs the following year.

If PEC’s energy use is high during the 4CP events, the cooperative will be charged more in transmission costs the following year — and because that cost is passed directly through to members, our members will see a higher transmission cost on their bills.

 

Diagram showing Transmission Cost of Service line item
Caption: Transmission costs are “pass-through” costs that come straight from the PUCT and statewide transmission providers to you.

Conversely, by lowering our 4CP relative to the other energy utilities in Texas, we’re able to enjoy a lower rate since we’re effectively using fewer grid resources. Efforts by PEC and members like you last summer helped avoid $1.4 million in additional transmission costs this year.
Learn ways to take the power into your own hands and reduce transmission costs »

When do these 4CP events occur?

We can predict that a hot day might produce a peak event, but we can’t be sure until after it’s happened. That’s why it’s important to all pitch in together to shift our electric use away from the high demand time of 2-6 p.m., June through September — what we call Power Rush Hour.

How much could I save?

Take a look at your monthly PEC bill. For most residential members, the transmission costs comprise about 8–12 percent of the total due.

For the past six years, that number has been increasing. But never fear — if you and your fellow members all take on Power Rush Hour together, you can reduce that cost on your bills.