Understanding the Power Cost Adjustment (PCA) on Your Electric Bill
City of Winnfield, Louisiana
Each month, the City of Winnfield includes a charge on electric bills called the Power Cost Adjustment (PCA). The PCA reflects an adjustment for the actual cost of wholesale power during each billing period, which may be higher or lower than the base rate for electricity.
Why is the PCA necessary?
To provide electricity to homes and businesses in Winnfield, the City purchases wholesale power from its power supplier. The cost of generating electricity can fluctuate due to several factors, including the price of fuel sources such as natural gas, coal, and renewable energy, as well as market conditions that affect the cost of purchasing electricity.
Because these costs change throughout the year, the difference between the estimated base cost of power and the actual cost of power is adjusted through the Power Cost Adjustment.
When the actual cost of power is higher than the base rate, the PCA appears as an additional charge on your bill. When the cost of power is lower than the base rate, the PCA may appear as a credit, reducing the amount owed.
How is my PCA calculated?
The PCA is based on the amount of electricity used during the billing period, measured in kilowatt-hours (kWh).
Customers can estimate their PCA using the following formula:
PCA Rate × Total kWh Used = Total PCA Charge (or Credit)
This method ensures that customers are billed fairly based on their individual electricity usage and the fluctuating cost of wholesale power.
Do other electric utilities use a PCA?
Yes. The cost of wholesale electricity is one of the largest expenses for electric utilities. Most utilities across Louisiana and the United States use a similar monthly adjustment to reflect changing fuel and power production costs.
While the terminology may differ—such as Power Cost Adjustment, Fuel Cost Adjustment, or Wholesale Power Adjustment—the purpose is the same: to ensure electric rates accurately reflect the actual cost of generating and purchasing power.
The City of Winnfield is committed to transparency and providing reliable electric service to our community.