Purchased Power and Fuel Adjustment Charge
The Purchased Power and Fuel Adjustment Charge, or PPFAC, is a usage-based charge that reflects changes in the costs UniSource incurs to fuel its power plants and purchase energy for electric customers. The charge includes only costs that are not already incorporated in base power supply rates.
UniSource passes along these costs without any markup and earns no profit from this charge. The following questions and answers offer more information about the PPFAC.
Why does the PPFAC change from month to month?
The rate is adjusted monthly based on a 12-month “rolling” average of recent energy costs, with limits on month-to-month increases. Because of those limits, the PPFAC sometimes cannot keep up with significant changes in market energy prices. When that happens, the Arizona Corporation Commission (ACC) may approve a temporary surcharge or credit to recover or refund the difference between the amount UniSource has paid for energy and the amount it has recovered through the charge.
Have any surcharges or credits been added to bills?
In May 2023, the ACC approved an adjustment to a PPFAC surcharge for use beginning that month. The surcharge, which increased to $0.022259 per kilowatt hour (kWh) from $0.00987 per kWh, will help recover costs that UniSource paid for fuel and power during extreme summer heat and throughout severe winter storms that affected the West.
How do these changes affect UniSource electric bills?
For residential customers, the updated temporary PPFAC surcharge will result in an estimated monthly bill increase of about $11 until UniSource can recover outstanding costs of fuel and purchased power. The actual impact will vary based on individual usage. The temporary surcharge is expected to expire in December 2025.
Are there any other factors that affect my bill?
In January 2022, the ACC approved UniSource's request to apply a tax savings credit to customer bills for two years along with the PPFAC surcharge. These credits will help mitigate the impact of higher energy costs on customer’s bills through January 2024.
Where can I view the current PPFAC rate?
The current rate is updated monthly and listed in our electric rates section.
How does the PPFAC appear on my monthly bill?
The PPFAC appears on your bill under the heading “Power Supply Charges” along with your base power supply rate.
Do other utilities have charges like this?
Yes. Similar components are included in the electric rates of UES’ sister company, Tucson Electric Power, as well as in those charged by Arizona Public Service and many other electric utilities.
Do all customers have to pay this charge?
Customers of our Bright Arizona Community Solar program are not required to pay the PPFAC for solar power purchased through the program.
Will my bill be lower if I purchase solar power through the Bright Arizona Community Solar program?
Bright Arizona Community Solar is not designed to reduce customers’ electric bills. Rather, it offers an easy, affordable way to meet your electric needs with clean, renewable energy. Participants in the Bright Arizona Community Solar program can purchase 150 kWh “blocks” of solar energy produced by local photovoltaic arrays. Each block will replace the charges for an equivalent amount of traditional power at a cost that adds $3 apiece to participants’ monthly bills. Because solar power currently costs more than traditional energy resources, the energy blocks available from the Bright Arizona Community Solar Program will add to your monthly electric bill. But the price you’ll pay for each block will remain fixed for 20 years under ACC-approved program rules, so you may realize future savings if the cost of traditional energy resources increases. See the Bright Arizona Community Solar page for more information.
