Rate Change FAQ

Key information

In 2021, PEC incurred $160 million in unexpected costs due to Winter Storm Uri and was required to recover the majority of those costs through a temporary Winter Storm Surcharge. PEC has successfully repaid the debt from Uri in a much shorter period than many utilities. This surcharge will be removed from member bills issued on or after October 1, 2023.

Maintaining the co-op’s financial health is essential to protecting our members’ interests now and into the future. We work hard to keep rates among the lowest in Texas, balancing costs with reliability and safety – always with the member in mind.

PEC does not generate the power it delivers, but instead purchases it from generators and delivers it to our members. PEC sets rates as close as possible to the cost of service, which includes the cost of purchased power.

The cooperative’s largest operating expense is the cost of power. According to the ERCOT Independent Market Monitor (IMM), the market costs for power in ERCOT have risen from $11.5 billion to $32.2 billion from 2020 to 2022. This represents a tripling of ERCOT power costs since 2020. Despite Texas’ rising power costs, PEC’s Base Power Charge has decreased or remained steady from 2015 to 2023.

PEC Base Power Cost 2013-2024

PEC Base Power Charge history

PEC’s Base Power Cost rate recovers the cost of purchasing electricity. As the power market continues to rise, PEC must make an adjustment to the Base Power Cost rate. The PEC Board of Directors have approved adjusting the Base Power Cost from $0.044500 to $0.058500 per kWh for all bills issued on and after October 1, 2023.

With the Winter Storm Surcharge being removed from bills, the Base Power Cost adjustment will result in a net increase to members of 6.2% or $8.75 for the average member using 1,250 kWh per month. PEC will not profit from the Base Power Cost rate change. This rate is passed through to members at PEC’s actual cost.

Operating costs other than the cost of power are not contributing to the need to raise rates. PEC has leveraged technology, cut costs, and lowered borrowing costs to keep operating expenses flat over the last five years, all despite rising interest rates and inflationary pressure. The increased market price of power is simply too large to make up for elsewhere.

PEC’s rates are still 15% lower than the state average and 25% lower than the national average. In a year, PEC members will still pay nearly $620 less than the national average and about $332 less than the state average.

PEC regional rate comparison

The data shown is from publicly available sources and adjusted to 1,250 kWh for comparison. The bars shown in yellow are data from the utility site listed. The bars shown in orange are from the EIA Electric Power Monthly Report. The bars shown in purple are from the PUCT Quarterly Retail Electric Service Bill Comparison for Residential Electric Service. *Annualized numbers for summer and non-summer rates. **Annualized numbers using repeated June number to correct the lack of September 2022.


As a transmission and distribution cooperative, PEC purchases electricity from generators on behalf of our members. The price of power is rising across the state of Texas, and PEC must set rates to recover expenses. ERCOT market costs have tripled since 2020.

The price of power in ERCOT is set by the wholesale power market. PEC doesn’t generate electricity; instead, as an electrical transmission and distribution cooperative, we purchase power from generators. While we strive to negotiate the best price from our suppliers, the cost is subject to a variety of market factors beyond PEC’s control. The increase in power prices is impacting utilities across the state and nation.

With the removal of the temporary Winter Storm Surcharge from bills and Base Power Cost adjustment, the average member who uses 1,250 kWh is likely to see a net increase of about 6.2% or $8.75 per month.

Members can reduce the impact of the proposed rate change by conserving energy. This rate adjustment applies only to the Base Power Cost, which is applied per kWh. If you can reduce your energy use, you can offset the increase on your bill.

We are happy to provide helpful tips on how to conserve energy! You can also monitor your daily use through ‘My Usage’ on SmartHub. This tool allows you to see how temperatures affect your usage and may help you identify opportunities to conserve energy.

PEC has leveraged technology, cut costs, and lowered borrowing costs to keep operating expenses flat over the last five years despite rising interest rates and inflationary pressure. Inflation is up 28% since 2018. The increased price of power is simply too large to overcome with other operating cost savings.

Yes. The increase in power prices is impacting utilities across the state and nation. If the Base Power Cost adjustment in October 2023 is approved, PEC’s rates will remain below the average residential rate in Texas.

Member assistance is available from PEC for members who qualify, and we partner with area agencies that can help us match available funds to the people who need them most.

Our Member Assistance Program provides a maximum of $300 per calendar year to qualifying PEC members. If you would like to apply for assistance with your electric bill, click here for a full list of participating agencies in and around our service area. Please note that application for aid does not guarantee assistance.

Yes. All rate changes, regardless of a member’s account type or employment status, will be subject to this rate change. It applies to all PEC residential, small power, large power, and interconnected members, including the cooperative’s Board of Directors, executives, and employees.

This will be a charge per kilowatt hour of usage each month and will impact both residential and commercial members. Because everyone’s electricity use is different, the impact of the rate change will be dependent on actual usage.

This change is applied proportionally to the Base Power Time-Of-Use Charge. For a detailed look at the new rates, visit the Time-Of-Use Rate page.

As a nonprofit cooperative, PEC must allocate our margins to our member-owners.

Capital credit allocation is a process to attribute margins to a member’s account. Allocations occur when PEC earns margins in the previous calendar year. Because PEC’s 2022 net margins were positive, they must be allocated to each member’s account in 2023. At a future date, the capital credits will be distributed to the members.

A capital credit allocation is not a distribution; rather, it is the recognition of the fact that, at some point in the future, those capital credits will be distributed to members.