Power Supply Adjustment (PSA)

The Power Supply Adjustment is the mechanism PWC uses when the actual costs associated with supplying power are higher than estimated and is not the same as is collected by PWC’s established rates and fees. PSAs are approved by the Commission and are generally set to recover the costs over a 12-month period and expire automatically. PWC may use a PSA to recover power supply costs if there is more than a 5% difference between the cost of providing energy and the determinants (data points and pricing information) used by PWC in estimating power supply costs and establishing rates. 

When costs are higher than expected, PSA’s are typically an additional energy charge based on consumption. However, if electricity costs are lower than expected, the PSA can be a credit on the customer’s account. For the third year in a row, PSA’s have been issued because the costs of buying energy have been higher than the estimated pricing and costs used to set base rates. 

PWC purchases power from Duke Energy Progress (DEP) and they provide PWC with its estimated pricing. PWC uses these estimates in establishing rates. In June of each year DEP charges a “true-up” that covers the difference between the actual cost of providing energy and capacity versus what was paid using the estimated pricing over the prior calendar year. The true-up payment includes capacity charges relating to DEP’s investment in generation infrastructure and other resources to ensure they can meet all of their customers’ monthly peak demands.   One of the ways PWC saves money is by monitoring actual costs from DEP on energy and approving a “catch-up”, which is a prepayment to DEP and helps to mitigate the interest that would have been owed to DEP had no catch-up been paid.

What You Need to Know About Changes Coming to Your Electric Bill

PWC is a not-for-profit Public Power Entity owned by the public and our goal is to keep rates and fees as low as possible while covering the actual cost of providing services. With investor-owned utilities, they have to turn a profit and answer to their shareholders.  

Like other businesses, PWC is not immune to inflation and cost increases. PWC is dedicated to keeping rates and fees as low as possible and limiting increases to only when it is necessary to continue providing safe and reliable utility services.  

PWC is using the Power Supply Adjustment, or PSA, to cover the additional costs. This is because the cost of getting electricity from Duke Energy Progress has gone up by about $10.6 million since last year. The Board of Commissioners for PWC held a public hearing for the proposed PSA at their meeting on August 13, 2025 and approved the new PSA to go into effect on September 1, 2025 after the previous PSA expires.