Here at TownTalk Media, we have seen a lot of citizens concerned about their utility bills, specifically the electric portion. Rightfully so. Even our bill is higher, at the house, the church, and the office. Our family and friends are also understandably concerned. So we do feel the pain as well. So we would like to explain the Brownfield city’s electric bills
During the fiscal budget work sessions for the period from October 1, 2023, to September 30, 2024, the council approved a 2.5% increase in electric rates. Additionally, the city changed the billing format. Previously, utility bills were sent in a postcard-style format, but the council has now switched to a letter-sized (8.5 x 11 inches) paper enclosed in an envelope. This change aims to enhance transparency by providing an itemized breakdown of electricity charges. In the previous postcard format, charges such as the energy charge (delivery cost), meter fee (SER AV CH), and power cost adjustment were all bundled into a single total cost.
Let’s break it down for clarity:
The meter fee remains constant; it is a set price. The energy charge, on the other hand, refers to the cost of delivering electricity. The City of Brownfield owns its poles and lines, which means that the energy charge is a fixed rate that customers pay to the city for delivering electricity.
However, the charge that most people are concerned about is the power cost adjustment. The City of Brownfield purchases its energy from American Electric Power (AEP) and West Municipal Power Association (WMPA, which includes Brownfield, Tulia, and Floydada), which charges a wholesale rate. This wholesale rate constitutes the power cost adjustment charge that customers see on their electric bills. The city pays this charge to AEP, which is then passed on to the customers.
When customers pay their electric bills, the energy charge and the meter fee remain with the City of Brownfield. It’s important to note that the power cost adjustment is fully paid back to AEP.
This brings us to why customers’ bills are higher on the power cost adjustment line item.
You might remember that in February 2021, Winter Storm Uri struck Texas, leading to the failure of the Electric Reliability Council of Texas (ERCOT) grid. During this crisis, other power supply companies, like AEP, had to produce more energy to support the grid, resulting in a supply and demand issue. While ERCOT struggled, AEP generated the necessary electricity to keep the lights on. Consequently, Brownfield received a wholesale bill from AEP for February 2021 that was ten times higher than usual. Typically, the average cost of electricity in February is around $300,000, but in 2021, it skyrocketed to over $3 million. Unfortunately, this extraordinary cost had to be passed on to the customers. To put this in perspective, the City of Denton was charged an astonishing $210 million for just four days of sub-zero temperatures during Winter Storm Uri. They had initially been budgeted only $83.3 million for wholesale electricity costs for the entire fiscal year. However, Denton wasn’t the only city affected; customers across the North Texas region, particularly in Ellis County, Tarrant County, Dallas County, Collin County, and Johnson County, will be paying for the impact of Uri for over 20 years. The Brownfield City Council aimed to recover the $3 million within three years. Remarkably, they achieved this in just two years and then decided to discontinue charging the Uri fee.
In March 2025, the Panhandle, South Plains, Permian Basin, and Eastern New Mexico experienced extremely high winds, prompting Excel Energy to implement Public Safety Power Shutoffs (PSPS), there was a coal burning power plant down, and a few other power plants were performing “turn arounds”. As a result, American Electric Power (AEP) increased its wholesale rates due to electricity congestion costs and a lack of energy being produced. These congestion costs occur when the demand for electricity transmission exceeds the available capacity on the grid. When lower-cost generation sources cannot deliver electricity to consumers because of insufficient transmission lines, the system must rely on more expensive generation options. This ultimately leads to higher overall electricity prices for consumers, essentially another example of the supply and demand imbalance.
It’s important to note that all costs associated with the wholesale side must be fully reimbursed to SPP. When we analyze the total electric costs, including the ENERGY CHARGE, POWER ADJUSTMENT COST, and METER FEE, we typically see rates ranging from $0.13 to $0.15 per kilowatt-hour. However, due to recent congestion costs, this amount has risen to over $0.21 per kilowatt-hour. For our customers, if we break it down: the ENERGY CHARGE plus METER FEE—which are allocated to the city—comes to $0.082 per kilowatt-hour. If we consider just the POWER COST ADJUSTMENT from this past bill, it was $0.135 per kilowatt-hour. When we combine these two components, the total comes to $0.217 per kilowatt-hour. Understanding these figures can help us navigate our energy costs more effectively.