Increase Offsets 4.23 percent Wholesale Power Increase from Tri-State
United Power’s Board of Directors approved a rate increase of 2.79 percent for residential and commercial members in 2017. The rate increase, coupled with cost containment efforts, will offset the 4.23 percent increase in wholesale power from Tri-State Generation and Transmission, United Power’s wholesale power supplier.
The average residential member will see an increase of less than $3 a month in their bill, while commercial members will see just under a $13 increase. The rate increase would become effective for usage beginning February 1st, so members will not see the increase until their March, 2017 bill.
“The board and staff worked hard looking at the ways we could contain operating costs to lessen the impact of this increase on our members,” said Darryl Schriver, CEO. “This modest increase will help the cooperative remain financially healthy, and should make a minimal impact on most members’ electric bills.”
Tri-State Generation and Transmission, a generation cooperative headquartered in Westminster, provides wholesale power to 43 distribution cooperatives in a four state region, including United Power. Tri-State indicated that both increased expenses and lower revenues have made the increase necessary.
An unexpected mid-year increase in power costs from one of their larger suppliers, coupled with increased costs of producing power is stated to be key drivers of their expense increases. Tri-State states that cost increases are being driven by regulatory compliance, additional environmental controls and increases to basic fuel and production costs.
Tri-State is also forecasting a reduction in revenue, due in part to lagging oil and gas production, slow growth, and closure of several large manufacturing and energy production facilities throughout their territory.
In 2014, United Power absorbed most of a 1.6 percent wholesale power cost increase by adjusting rates to a handful of rate classes, and reducing some operational costs. In 2015 only one industrial rate was adjusted even though many costs continued to increase for the cooperative.
“I am pleased with the effort both the board and staff made to find a rate solution that balanced the cooperative’s financial health and the well-being of our members,” Schriver said. “We remain committed to looking out for all our members, while continuing to build a system that delivers safe and reliable power.”