Fuel Charge

The Fuel Charge recovers the cost for the fuel needed to generate electricity. This charge is a dollar-for-dollar pass to the customer. Austin Energy does not profit from the revenues collected through the fuel charge.

	View Current Fuel Charges >>
	View Fuel Adjustment Clause >>

Fuel Charge Components

The fuel charge consists of three components:
	The estimated average fuel and purchased power cost for the year,
	The estimated fees and charges from the Electric Reliability Council of Texas (ERCOT) incurred to meet service-area obligations for the calendar year
	The projected generation requirements for the year
	The combination of plants projected to be used to meet that generation requirement
	An adjustment for previous over- or under-recoveries.

The estimate is the forecasted fuel and purchased power cost, plus the estimated ERCOT fees and charges for the year divided by the estimated kilowatt-hour sales.

The forecasted fuel and purchased power cost is based on:
	The projected generation requirements for the year
	The combination of plants projected to be used to meet that generation requirement
	The estimated price of the coal, gas and nuclear fuel used to operate those plants

We generally use gas generation for peak periods, primarily during the summer. Additionally, when there is an outage at one of the nuclear or coal units, more gas generation may be required.

ERCOT Fees and Charges
Beginning October 1, 2002 certain ERCOT fees and charges were included in the calculation of the fuel factor. We estimate ERCOT fees and charges based on:

	The level of current applicable ERCOT fees and charges
	The estimated energy and capacity needed to meet Austin Energy service-area obligations

Over-Recovery and Under-Recovery of Revenues

If Austin Energy collects more in fuel charge revenues than the actual cost, we subtract the over-recovery from the estimate. Similarly, if the actual fuel charge revenues recovered are less than the actual cost, we add the under-recovery to the estimate.

Fuel Adjustment Factors

Finally, we make an adjustment to the fuel factor to reflect the different voltage levels of power that customers receive. We meter primary level customers on the high side of the transformer, before transformation losses occur. We make a voltage level adjustment, resulting in primary customers receiving a slightly lower fuel factor than secondary level customers.