JEA’s residential electric customers will likely experience a bit of “Christmas in April.”
The community-owned not-for-profit utility’s board of directors is expected Tuesday to approve a $50 million Fuel Charge Fund rebate that will appear as a credit on April electric bills.
It’s all based on the global fossil fuels markets, said Melissa Dykes, JEA’s chief financial officer.
Each September, when the utility sets its budget for the upcoming fiscal year, the anticipated cost of coal and natural gas is built into the fuel charge, which is a line item on the monthly bills. Dykes said the projected cost is based on history and on volatility of the markets.
Since September, prices for coal and natural gas have been lower than anticipated, benefiting the utility.
“It’s the same thing people are seeing at the gas station pump and the price of natural gas is down. Also, the demand for coal is down, which lowers the price,” she said.
That means the utility has a Fuel Reserve Fund equal to 19 percent of the maximum 12-month historical cost. JEA’s pricing policy specifies a target of 15 percent of the maximum cost.
The 4 percent difference — about $50 million this year — will appear as a one-time credit to customers on a pro-rated basis depending on average monthly consumption.
For customers using 1,000 kilowatt-hours per month, the credit will be about $56.
This will be the third consecutive year JEA customers have received the fuel reserve credit.
The board in 2013 approved a $37 million fuel charge credit to customers; in 2014, the rebate total was $26 million.
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