Top 10 Facts About Rising Energy Costs:

1.  Gulf Coast Electric Cooperative is raising our costs to cover increased wholesale power costs.

Gulf Coast Electric is implementing a 10 mill increase for members.  For an average household, that would mean an additional $10 per month per 1,000 kWh of electricity consumed.  This increase became effective Sept. 1, 2008, so September 2008 bills will be impacted.

GCEC’s wholesale power supplier, PowerSouth Energy Cooperative, has recently implemented a rate increase to compensate for a dramatic rise in fuel and purchased power costs.  

Fuel used to generate electricity is getting more expensive, based on factors outside PowerSouth’s control.  Since 2000, natural gas costs have increased by 446 percent, with a 72 percent increase since January 2008 alone.  Natural gas markets are driven by the basic economic principle of supply and demand.  Natural gas production has not kept pace with rising demand.

Today’s coal market is extremely tight.  Flooding in the Midwest has limited deliveries and slowed production.  Domestic exports have doubled to support global demand.  Mining accidents have increased the difficulty of gaining permits for new mines and finding skilled workers.  Once again, the concept of supply and demand has forced the cost of coal to new levels. Gulf Coast Electric Cooperative’s 2008 wholesale power budget was based on a delivered price of $2.49 per million Btu, and PowerSouth has recently made purchases of $6.99 per million Btu – a 180 percent increase.

2.  The increase reflects increases to our cost of doing business.

Gulf Coast Electric periodically modifies our fuel adjustment to cover our operating costs.  We keep a constant vigil on our costs to ensure we are managing your cooperative’s assets wisely.  The fuel adjustment will continue to reflect our cost of doing business.

3.  Increases can be a result of unexpected circumstances.

It is GCEC’s goal to pass along pricing information to our members in a timely manner.  Typically, a planned increase allows more time to tell members when a price increase can be expected.  Unplanned increases due to factors such as rising fuel prices; unexpected, increased purchased power costs; inflation pressures; increased demand during peak generation periods; and power interruptions due to repairing and rebuilding lines from storm damage, often give us less time to communicate pricing adjustments.

Gulf Coast Electric Cooperative strives to give members as much notice as possible when a rate increase is imminent.

4.  Other utilities are also implementing rate increases.

Rising fuel costs are not only affecting Gulf Coast Electric – the impact is being felt across the nation.  Because of rising consumer demand (or usage) and increasing costs, electric utilities nationwide are being forced to implement rate increases.  Electric cooperatives and investor-owned utilities alike have passed to their consumers increases in the costs of doing business.

We certainly regret having to pass on these increases to our members, but GCEC remains proactive in planning for your future energy needs.

5.  Gulf Coast Electric Cooperative works to keep costs as low as possible.

We work to keep electricity a great value, even as the costs of other commodities skyrocket.  Gulf Coast Electric strives to operate efficiently while sticking to our mission of providing reliable and economical energy.  We’re always looking for ways to better manage costs.   

6.   GCEC has not raised rates since September 2007.  This was the first rate increase in 11 years.

While virtually all aspects of today’s cost of living continue to rise, we pride ourselves on avoiding routine price adjustments.  We only consider an adjustment when we have no other choice because we believe reliable service at a reasonable price is something our members deserve.  Although we must raise our price to cover the costs of doing business, we are committed to ensuring this occurrence has the smallest possible impact on you.

7.  More cost of power sold adjustment increases might be necessary.

Cost of power sold adjustment increases can be a result of unplanned situations, such as rising fuel costs and storm damage.  The cost of electricity is also increasing because of higher demand, tighter supply and more environmental restrictions.  We promise to minimize the impacts of these issues by being proactive in our planning, offering education and training on energy efficiency and focusing on maintaining the reliability, quality and integrity of our systems.

8.  Gulf Coast Electric Cooperative’s rates are comparable to those of other utilities.

On an average basis, Gulf Coast Electric’s rates are competitive with our peers.  Other utilities, including investor-owned utilities, are subject to the same factors that impact our costs, such as fuel prices and availability.  We strive to keep our rates as low as possible while maintaining the reliability and integrity our members expect.

9.  GCEC does not profit from higher rates.

Gulf Coast Electric Cooperative is a not-for-profit, member-owned organization.  We are in the business for the public good rather than for the financial benefit of an individual owner or stockholders.  We don’t profit from our members, rather we sell electricity to our members at the lowest price possible.

10. You have the power to control your power bills.

Your electric bill is based on how much power you use, and you have ultimate control over your usage. Gulf Coast Electric offers a number of options to help members manage their power bills, including energy audits, energy efficiency programs and levelized billing.  To learn more about reducing energy usage, we encourage members to call us at 850-265-3631 (Southport) or 850-639-2216 (Wewahitchka) to speak to an energy specialist in our marketing department, or click here for energy saving tips.