TVA produces electricity and sells it to distributors, like KUB, which delivers electricity to homes and businesses. (TVA is KUB's single provider of electricity).
As TVA's costs for non-controllable items such as coal, natural gas, and purchased power rise and fall, TVA passes 100 percent of the cost increase or decrease along to distributors through its Fuel Cost Adjustment (FCA). TVA may make adjustments each month as needed, to reflect the difference in projected and actual fuel costs. The FCA is a system of pricing electricity that is similar to how natural gas is priced.
KUB passes 100 percent of TVA increases/decreases to customers, therefore, KUB business electric rates may vary each month. The FCA will also impact those KUB customers who are billed each month for private outdoor lighting. The charges for the private outdoor security lights will automatically adjust as the TVA FCA moves rates up or down.
Note: Additional service charges not listed below may apply to customer bills. Contact KUB at 524-2911 for the most accurate billing information.
KUB purchases natural gas on the open market for resale to customers. Although market prices do fluctuate, KUB purchases natural gas throughout the year to smooth out market prices. We then simply add the cost of delivering gas to the wholesale rate without any additional markup. This method allows KUB to maintain a reliable supply of natural gas for its customers while keeping costs as low and smooth as possible.