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Power board backs 12‑month rolling PCA in rate study amid EDAM transition
Summary
Hurricane City Power Board voted to include a 12‑month rolling Power Cost Adjustment (PCA) in its forthcoming cost‑of‑service study, citing volatility tied to Pacific Corp’s move into the extended day‑ahead market (EDAM). Staff will finalize rate design with the consultant and present a package to city council.
The Hurricane City Power Board voted to include a 12‑month rolling Power Cost Adjustment (PCA) in the utility’s upcoming cost‑of‑service study, adopting the motion by voice vote after staff warned that the extended day‑ahead market (EDAM) will change how the city buys and sells power.
Staff member (Speaker 2) told the board EDAM requires participants to establish day‑ahead resource sufficiency and "requires us to purchase power at least 1 day in advance prior to the day coming to," a change staff said will force cities into a persistent day‑ahead "long" position equal to roughly 120% of projected load.
The board’s motion — made by Speaker 3 and seconded by Speaker 5 — directs staff to include a PCA (calculated as a 12‑month rolling average of power costs) as one scenario in the consultant’s cost‑of‑service and rate design deliverables. The board took the recommendation so staff can present a full package, including a rate design, to the city council.
Why it matters: staff and several board members argued the PCA smooths market spikes over a 12‑month window and protects the utility’s cash reserves from short‑term wholesale price shocks tied to EDAM and other market volatility. Speaker 4 put the situation bluntly: Pacific Corp "chose to participate" in the new market, and local utilities that rely on its transmission must follow its market rules.
Opponents and concerns: other board members warned the PCA could be confusing to customers and stressed a need for public education. Staff said PCA would appear as a separate billing line item (positive or negative) and that the city’s planned AMI (advanced metering infrastructure) rollout could later offer optional time‑of‑use tools for customers who want greater price signal visibility.
Next steps: consultant Jillian will prepare a detailed rate design using real numbers and include the PCA scenario in the final study. Staff indicated the board will review the consultant’s work before it goes to city council; staff said an implementation target would align with the new fiscal year if council approval is secured. The board set its next meeting for March 11 to review the restated pooling agreement and updated rate work.
Quotes from the meeting: "EDAM...requires us to purchase power at least 1 day in advance," (Speaker 2). "We have absolutely no decision making when it comes to that fault," (Speaker 4), referring to Pacific Corp’s market decision and its implications for participants.
The vote: the motion to include a 12‑month rolling PCA in the study was moved by Speaker 3, seconded by Speaker 5, and approved by voice vote.
