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Local Ownership Helps Stabilize Electric Market Swings

Posted on Wednesday, October 27, 2021

An emerging trend in power generation means that natural gas market prices can also affect electric bills. A growing portion of our country’s electricity is generated by natural gas. So when natural gas prices are high, electric market prices also tend to go up. Energy market costs are typically passed through to customers with a variable charge on utility bills, the Energy Cost Adjustment (ECA).

The good news is that CFU owns generating assets that can help control electric costs for customers when market prices are high. CFU continues to own and operate the Streeter Station power plant in Cedar Falls. In addition, CFU owns shares of large power plants in western Iowa and maintains a community solar array. Plant ownership reduces the amount of energy CFU has to buy to supply to customers when prices are extremely high.

While utility bills will be affected by wholesale market cost increases, we can avoid extreme bill impacts because of CFU's ability to produce electricity. Market volatility emphasizes the importance of local ownership of generating resources. CFU will continue to own a diverse and robust mix of power resources to provide reliable and affordable service.