Costs Rise for Texas Utility’s Green Power

February 20, 2004 [] The Austin City Council approved an increase in the “green power charge” under which customers can subscribe to Austin Energy’s Green Choice renewable energy program. The increase, from 2.85ý/kWh to 3.3ý/kWh, will apply to new program subscribers only; current subscribers will continue to pay the lower green power rates established in earlier phases of the program. GreenChoice subscribers pay the green power charge rather than the normal fuel charge on that portion of their usage subscribed to green power. The current fuel charge is 2.796ý/kWh, making the effective green power premium about 0.5ý/kWh for new subscribers. The green power charge remains fixed for the term of the utility’s renewable energy contracts, which is generally 10 years. Austin Energy attributes the rate increase to a combination of factors, including higher contract costs for wind energy because of transmission congestion costs and ERCOT fees, the costs of servicing new subscribers with spot market purchases until the new wind resources are developed, and inclusion of marketing and servicing costs.
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