High usage and wholesale prices cause spike in bills

by Elizabeth Pitts-Hibbard

As utility bills arrive in mailboxes this week across Marlow, customers will face higher bills.

“Higher utility bills are a normal part of the summer months, but this month’s bill (due on or before Aug. 10) is an unfortunate meeting of a couple factors that have driven up the cost,” said city administrator Jason McPherson.

Usage on Marlow’s electric grid for the billing period (June 16 through July 15) topped the previous month by more than 1.5 million kilowatt hours, according to the city.

“Usage is up across the board from residential customers to commercial customers,” McPherson said. “The first part of July brought out the triple-digit temperatures. With that comes increased usage as air conditioners run constantly.”

The average high temperature for the billing period was 98.2 degrees, according to the Mesonet site in Stephens County. The high reached 107 on July 8. And this area has not been alone in the enduring heat. High temperatures were felt across the nation, leading to increased demand and usage.

That leads to the other factor of continued high prices for natural gas, which is a primary source of fuel for electric generation plants on the nationwide grid. This is what affects the POW Cost on Marlow’s utility bills.

“The POW Cost is the power-cost adjustment that ensures the utility is covering all costs associated with buying wholesale power to provide customers,” McPherson said. “The city worked to reduce this cost several years ago, but the high natural gas prices caused this to work back up again.”

For its short-term outlook, the Energy Information Administration (EIA) said that it expects the average peak-hour wholesale prices in the Southwest Power Pool (SPP) in June through August to nearly double what they were a year earlier. The SPP market includes Oklahoma and 13 other states. Other areas of the country, such as New England, are predicted to increase by as much as 167 percent.

Nationally, residential rates are expected to continue to increase through August of 2022.

On July 5, the SPP announced that it had reached an all-time peak load and, multiple times during the last month, has sent out alerts about grid conditions, due to unusually high demand. That all-time peak record was broken again on July 11, 14 and 15.

“The good news is customers can control usage by raising the temperature on the thermostat and avoid using large appliances during the peak heat times of the day, usually 2 p.m. to 7 p.m.,” McPherson noted. “Every little bit helps.”