Salt River Project’s (SRP) board of directors has approved an average 3.7 percent decrease in electricity prices for the two hottest months of this year, saving the average residential customer approximately $7.60 for the July and August billing cycles.

One of the price components, the Environmental Programs Cost Adjustment Factor (EPCAF), tracks costs and revenues related to renewable energy and energy-efficiency programs adopted to comply with the company's sustainability standards. The temporary price reduction reflects SRP’s ability to meet its sustainability goals at a lower cost to customers than expected. SRP also instituted a temporary reduction of 1.2 percent in the EPCAF from the November 2015 billing cycle to the April 2016 billing cycle.

The second component, the Fuel and Purchased Power Adjustment Mechanism (FPPAM), recovers fuel costs incurred to generate electricity as well as power purchases to serve customers. Lower-than-expected natural gas prices resulted in savings in this area. The costs of these two components are passed through to customers without markup.

Prices will return to the original summer season price approved last year for the September billing cycle.

According to SRP CEO and General Manager Mark Bonsall, management proposed reducing prices during July and August because this could provide relief to residential customers when it is needed most.