Heartland is an electric distribution cooperative. That means we buy wholesale power and deliver it to our members over our poles and wires.
We try to provide stable pricing for our members, but the reality is the cost of wholesale electricity is different from month to month, day to day, even moment to moment. Factors that affect cost include overall demand on the grid and the price of the fuels used to generate electricity during that time. We don’t know how much we will have to pay for power until we receive our monthly bill from our power supplier, KEPCo.
The Power Cost Adjustment helps us account for that variability and gives us a way to make sure we’re collecting enough revenue to cover our costs from month to month. Some months it might be a credit, and other months it might be a charge. It all just depends on what the wholesale electric market was like during the billing period.