News Releases

NPPD establishing a PCA for wholesale power bills; Additional 2018 surplus will go into reducing debt

September 12, 2019

Columbus, Neb. – Nebraska Public Power District will be providing a Production Cost Adjustment (PCA) credit to wholesale customers’ power bills, and at the same time reducing some of its bond debt with 2018 surplus funds following action taken by the Board of Directors Thursday at its monthly meeting.

Each year, NPPD uses cost projections and industry data to set rates at a level that aims to match revenues and expenses.  Many variables, most notably weather, impact actual revenues and expenses.  For 2018, NPPD was able to realize a surplus by implementing sound business practices and earning margins in the Southwest Power Pool regional market. Those margins bring dollars back into Nebraska, for the benefit of NPPD’s customers.

The Board of Directors reviewed six separate options before settling on this plan, balancing both the long-term stability of NPPD and the immediate needs of its wholesale customers.  “This decision by the board is a win-win situation for both NPPD and its wholesale customers,” said NPPD CEO and President Pat Pope. “Our wholesale customers will get some relief from the lingering effects of wet conditions this summer, and diminished irrigation load while NPPD will reduce some of our debt.”

A total of $46.1 million from the 2018 surplus will be used to give wholesale customers (public power districts, electric co-ops and municipalities that purchase electricity at wholesale including NPPD retail) a PCA credit. Wholesale utilities are expected to see a one year average bill reduction of 6.2%.  NPPD will utilize $16.9 million to retire certain bonds.

NPPD has had no wholesale base rate increases for the past three years and this marks the second year of refund to the wholesale customers.