AMARILLO, TX (KFDA) - Texas Xcel Energy customers may see an increase in their electric bills this Oct. to compensate for fuel market costs.
Currently, customers are billed for their fuel cost factor each month, which accounts for the cost of coal and natural gas used to produce electricity at area power plants, and also the cost of power purchased off of Xcel's system.
For the last several years customer's bills have been decreasing because of the declining fuel costs and unusually low prices for natural gas.
However, fuel costs are changing and the company is no longer making a profit off of them.
Since Feb. 1 the price Xcel pays for natural gas has risen by more than 24 percent, and the company said they have been under collecting for fuel costs, leading to the need to change the fuel cost factor.
Residential customer using 1,000 kilowatt-hours per month, on average, can expect to see an increase of $2.59 more per month. This purposed change is expected to take effect Oct. 1.
David Hudson, President of Xcel Energy Texas, believes an adjustment now will prevent the company from having to surcharge customers for under-collected amounts later.
In the meantime, the company plans on striving for improvements aimed at making the most of the customer's fuel dollar.
"While we do not have control over the cost of natural gas, we do have the ability to make efficiency improvements to our system that help hold down these costs over time," Hudson said. "We have a good track record of making timely improvements, such as the construction of new transmission tie lines that are helping us save $60 million a year or more on purchased power."