I was recently asked by a Member about what impacts electricity prices. We talked about how the daily cost of living seems to have increased across the board.

Just as inflation has impacted everything from the price of gasoline to the price of eggs, costs for the poles and equipment we use and the fuels required to produce electricity have also risen. This is a timely topic, so I wanted to help explain some of the factors that impact electricity prices and energy bills.

While there is no short answer, there are a few key elements that impact electricity prices and rates. Some of these factors Trico can manage, some of them you can impact, and other factors are beyond our control. So, let me break it down.  

There are three primary parts to your monthly electric bill: a fixed monthly charge, an energy consumption/kWh charge and a Power Cost Adjustment (PCA). To understand your total energy costs and what impacts your bill, lets unpack one piece at a time.        

The first is a fixed monthly charge, which covers the costs associated with providing electricity to your home. This includes equipment, materials, labor and operating costs necessary to serve each meter in Trico’s service territory, regardless of the amount of energy used. In order to ensure the reliable service you expect and deserve, we must maintain the local system, including power lines, substations and other necessary equipment. Like many other businesses, we’ve experienced supply chain issues and steep cost increases for some of our basic equipment. For example, the cost for a distribution transformer (which looks like a long metal can at the top of a power pole) has risen by as much as 400 percent since 2020, and wait times to receive this essential equipment are up to 52 weeks.

Because we are a not-for‑profit cooperative, some of these expenses must be passed on to our Members. I should note that the service charge is the same for everyone in a rate class and the costs are shared equally across the membership.

Another component of your monthly bill is the kWh charge, which covers how much energy you consume. You’ve likely noticed the amount of energy you use can vary from month to month and is typically impacted by extreme temperatures. When temperatures soar or dip, your cooling and heating equipment run longer, which increases your home energy use. Regardless, energy consumption is an area that you have some control over, and you can lower your monthly bill by actively reducing energy use. Your thermostat is a great place to start. Adjusting your thermostat up or down a few degrees can save you money and keep you comfortable.

The last component of your bill is the PCA. The PCA is affected by the cost of power that Trico purchases from our wholesale provider. The PCA covers fuel cost fluctuations without having to continually restructure electricity rates. Trico works hard to identify cost‑effective power sources and makes advance purchases when prices are low. In June, Trico reduced its PCA from 1.5 cents to 0.5 cents to help reduce bills in the summer months.

I hope this information sheds light on some of the factors that impact electricity prices. While we can’t control the weather or the rising costs of fuels, please know Trico is doing everything practical to keep costs down.

We’re here to help you, too. Contact us at 520-744-2944 if you have questions about your energy bill. 

CEO COLUMN:

I believe Trico is at an important stage in our growth and development, as changes in the industry, advances in technology, and changes in our Members’ needs shape the work we do today and in the future.

When I imagine the future of Trico, here is a what I envision:

I see a fully automated power delivery network that monitors and ensures a two-way flow of electricity and information between Trico, our generation sources and the end use appliance/equipment.

I see this system having distributed intelligence, coupled with broadband communications and automated control systems, enabling real time market transactions (prices/rates) and seamless interfaces among people, buildings, businesses, generation sources and our network. Our systems will sense, communicate, and operate bi-directionally.

I see faster detection of outages, automatic responses to them in some cases, and rapid restoration will improve the reliability and security of the grid.

I see more electricity use by our Members as they decarbonize their homes, businesses, farms, ranches, and transportation modes, choosing electricity over gas, propane, gasoline and diesel. Regarding vehicles, I see most of the Trico fleet being electric by 2030.

I see that while we are connected to regional transmission networks, and ultimately to the national backbone, more power from distributed energy systems (co-op and member-owned) flows to and from other Members first, and then to the regional network, depending on supply and demand conditions.

I see Trico’s Members having the ability to customize their electricity supply to suit their individual needs for power in terms of cost, environmental impacts, levels of reliability and power quality. This includes having long since moved away from a one-sized fits all business model to one where we are offering different levels of renewables, types of renewables, location of renewables, so that we can tailor services to individual Members.

In 2030, who better than our Member’s trusted local co-op to meet their needs and wants, just like we have been doing since 1945.

Ultimately, I see Trico enabling a more prosperous, healthier, and secure quality of life. This gets back to our mission – to make a difference in the communities we serve by providing our Members cost-effective and sustainable energy solutions.

As we reach the end of 2022, all of us at Trico would like to thank our Members. We are privileged to serve our community and look forward to a bright future together.

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This month, we’re celebrating YOU

October is National Co-op Month, a time when we celebrate you – our Members.

Our core business purpose is to serve as your energy provider, but the larger mission of the co-op is to make a difference in the communities we serve by providing our Members cost-effective and sustainable energy solutions.

All cooperatives adhere to the same set of seven principles that reflect our core values of service, dependability, innovation and integrity. The Cooperative Principles are essential to the co-op business model and benefit all Members of the co-op.

“Concern for community” is one of seven guiding principles that all co-ops share. Because we’re local, we understand our community’s unique needs and strive to help meet them.

We’re proud to support local youth through our Washington Youth Tour and scholarship programs. We support charitable organizations through our POWER Grants program, which provides grants to community organizations, schools, veteran’s groups, first responders, and food banks.  

The word “cooperative” is close to “cooperation,” meaning people working together towards a common goal—mutually benefitting one another and the larger community. That’s the essence of the cooperative spirit.

Above all, as a co-op we put our Members’ priorities first. As your trusted energy partner, we know that saving energy and money is important to you. That’s why we offer energy efficiency programs, such as our Tree Program and Energy Saving Workshops.

For Trico, a commitment to providing our Members with renewable energy alternatives is critical. Our website is a great resource if you’re interested in solar or electric vehicles. You can also call us if you have any questions about renewable energy.

We want to empower you to manage energy use at home. Through our SmartHub app, you can conveniently monitor and manage your energy use.

Trico is continuously examining ways to operate more efficiently while continuing to provide the highest level of friendly, reliable service you expect and deserve. After all, we’re your local co-op. We were built by the Members we serve.

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In November, you will have the opportunity to vote in the mid-term elections for two open seats on the Arizona Corporations Commission (ACC). One of the jobs assigned to the ACC by Arizona’s constitution is to regulate the rates of utility public service corporations, like Trico.

While these races may not be top-of-mind for most Arizonans, they are vitally important to ensuring affordable rates, dependable service, and sustainable energy supply. I want to encourage all Members to take time to research this year’s candidates, understand the issues, and vote.

As a cooperative, our Members elect a local Board of Directors to govern the affairs of Trico. However, it is the ACC, and not the cooperative, that has the final authority over issues related to the rates Trico charges. In some cases, this can include decisions on the type of power generation that can be built, the programs we can offer, and Trico’s energy prices.

Trico is large for a cooperative, but we are much smaller than Arizona’s investor-owned utilities. There is, of course, a cost to complying with the rules and regulations established by the ACC, and with a smaller staff this can be a heavy burden. We are appreciative that the ACC has often recognized that our size, connection to our Members, and locally elected Board makes us different, and provided us with a certain amount of flexibility and latitude.

We are strong advocates for local control, and we encourage you to support candidates who appreciate and acknowledge the unique benefits of the cooperative business model, and that support practical, flexible solutions for the diverse communities that we serve.

Our industry is changing quickly, and we work hard to balance reliability, sustainability, and cost-effectiveness. An example is Trico’s active investment in renewable generation resources that can reduce emissions and produce savings. We have a goal to reduce our carbon emissions by 50% by 2032, and a plan to do so in a way that ensures reliability and affordability for our Members. That plan involves a balanced approach incorporating several types of generation resources, including needed dispatchable generation, to ensure the transition to renewables is efficient and timely, and also safe and reliable.

We take pride in our commitment to serve our Members, and the fact that our Members vote to elect our Board. Cooperatives across the country know that the democratic process works best when people do their research, understand the issues, and make their voice heard by voting. Please make a plan to vote in November, and as always thank you for being a Member of Trico.

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