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Farmers Electric Cooperative Corporation Seeks Rate Increase to Reflect Wholesale Rate Changes

Strategic Insights

— 2 min read

The Arkansas Public Service Commission has been presented with a proposed rate increase by the Farmers Electric Cooperative Corporation (FECC) to reflect the changes in wholesale rates and charges requested by Arkansas Electric Cooperative Corporation (AECC). According to the application, FECC is seeking a modification of its retail rates and charges to "pass through" the requested rate increases in wholesale power by its power supplier, AECC, pursuant to Arkansas Code § 23-4-1105. The cooperative is also requesting the approval of an adjustment in its retail rates and charges using the procedures provided in Docket No. U-2811. The proposed rate increase aims to address the changes in wholesale rates and charges, with the estimated monthly impact on average residential customers in both dollars and percentage increase being $5.06, 3.8% in Summer, and $3.77, 3.7% in Non-Summer.

Key Takeaways:

  • FECC is seeking a rate increase of $134,666, resulting in a new retail revenue requirement of $9,977,950, compared to the current authorized retail revenue requirement of $9,562,627.
  • The proposed rate increase aims to reflect the changes in wholesale rates and charges requested by AECC, with the estimated monthly impact on average residential customers being $5.06, 3.8% in Summer, and $3.77, 3.7% in Non-Summer.
  • The cooperative is requesting the approval of an adjustment in its retail rates and charges using the procedures provided in Docket No. U-2811.
  • FECC has designated two individuals to receive pleadings, notices, and correspondence in this docket: Mr. Larry Bright and Mr. Craig R. Woycheese.
  • The cooperative is apportioning its proposed change in rates and charges in a manner that reflects, as closely as practicable, its cost of providing service to each class of customers.
  • The proposed rate increase is subject to the Arkansas Public Service Commission's approval and review.

Statistics:

  • Estimated monthly impact on average residential customer in both dollars and percentage increase: $5.06, 3.8% in Summer, and $3.77, 3.7% in Non-Summer.
  • Proposed rate increase: $134,666.
  • New retail revenue requirement: $9,977,950.
  • Current authorized retail revenue requirement: $9,562,627.
  • Percentage increase by rate class: Refer to "Summary of Act 676-2023 Unit Adjustments to Rate Schedules."
  • Current authorized return on equity and overall rate of return: 3%.
  • Requested return on equity and overall rate of return: Same as #5.

Sources:

  • Arkansas Public Service Commission, "Supplemental Application for Modification of Retail Rates and Charges to Incorporate Proposed Change in Wholesale Rates and Charges" (Docket No. 23-072-U), December 5, 2023.
  • Arkansas Public Service Commission, "Application for Modification of Rates and Charges" (Docket No. 23-072-U), December 5, 2023.

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