July will start with a lower fuel cost for Gainesville Regional Utilities’ (GRU) electricity customers after the utility announced a reduction to the fuel adjustment on Monday.  

The 15 mills reduction—from 65 mills to 50 mills—will save customers using 1,000 kilowatt hours (kWh) around $15 per month. GRU reports the average electricity bill at 800 kWh, resulting in $12 of monthly savings.  

Natural gas customers will also see reductions. GRU’s natural gas customers use 20 therms per month on average, saving $4 after the July reduction.   

Electricity bills come from three numbers—the customer charge, the base rate and the fuel adjustment. The Gainesville City Commission sets the base rate each year, and GRU officials monitor fuel prices in order to set the fuel adjustment, with the rate sometimes changing monthly.  

The fuel adjustment is a pass-through cost to customers, meaning GRU earns no revenue from that part of the bill. GRU last lowered the fuel adjustment in April, also by 15 mills.  

The new 50 mill rate means GRU customers pay five cents toward the fuel adjustment for every kWh used.  

“Being able to lower fuel charges in the summer is extremely significant for our customers,” said GRU General Manager Tony Cunningham. “We’ve been able to reduce a 1,000 kWh residential electric bill by $30 over the last four months without sacrificing reliability or safety.”     

Following the April reduction, GRU’s electricity bills per 1,000 kWH fell in statewide standings from the most expensive for March to seventh place, according to numbers from the Florida Municipal Electric Association. GRU’s 1,000 kWh bill also slipped below the bill average for investor-owned utilities.  

However, the reduction wasn’t enough to change the standings when looking at the average bill price from the past year, from May 2022 to April 2023. GRU still ranked second will Key West in the top spot.  

Fuel adjustment rates spiked in 2022 as gas prices rose globally. GRU’s fuel adjustment sat at 30 mills for October 2021 before rising to 80 mills by July 2022—nearly the same as the base rate for some customers. The rate remained steady for nine months before April’s reduction.  

July’s lower rate is based on “lower current and projected natural gas prices,” according to GRU’s press release.  

Customers protested high bills last year as GRU pointed to high summer heat and rising gas prices. Since then, the Florida Legislature has blamed the City Commission for high debt and rates and passed a bill to remove operational control of GRU the commissioners.