• Terms outline Settlement Agreement for power purchases and sale of utility assets.
• Following execution of a Settlement Agreement, United Power and Tri-State will file to dismiss litigation in the Adams County District Court.
• Settlement Agreement does not address contract termination payment proceeding before federal regulators.

Brighton/Westminster, Colorado – On Nov. 1, 2023, United Power, Inc. (United Power) and Tri-State Generation and Transmission Association, Inc. (Tri-State) executed a Term Sheet that sets forth terms for the two utilities to make good faith efforts to execute a formal Settlement Agreement involving power purchases and the sale of utility assets from Tri-State to United Power. 

The Term Sheet provides for a mutual release of claims and that the parties will cooperate to complete a Settlement Agreement and related agreements by Dec. 8, 2023, at which time United Power and Tri-State will jointly file for dismissal of the lawsuit, with prejudice, pending in the Adams County District Court.   

On Nov. 1, 2023, Tri-State’s Board of Directors unanimously approved the Term Sheet. On Nov. 6, 2023, United Power’s Board of Directors unanimously approved the Term Sheet. 

Tri-State and United Power will continue to take actions to ensure United Power’s timely exit by May 1, 2024, upon payment of a contract termination payment, with the amount to be set by the Federal Energy Regulatory Commission (Commission).  

The Settlement Agreement will not address the Commission proceeding related to the contract termination payment that members will pay to Tri-State to terminate their contracts early and withdraw from membership. The parties expect the Commission to issue a decision in that proceeding shortly.  

No further public comments will be made about the Settlement Agreement.

About United Power

United Power is a member-owned, not-for-profit electric cooperative, delivering electricity to homes, farms, and businesses throughout Colorado’s northern Front Range. The cooperative is one of the fastest-growing electric co-ops in the nation, and in June 2021 joined the elite ranks of cooperatives serving more than 100,000 meters. The 900-square mile service territory extends from the mountains of Coal Creek and Golden Gate Canyon, along the I-25 corridor and Carbon Valley region, to the farmlands of Brighton, Hudson, and Keenesburg. United Power is also a founding member of the NextGen Cooperative Alliance, which is dedicated to expanding the power supply and procurement options available to distribution co-ops and reforming the traditional generation and transmission business model. For more information about United Power, visit www.unitedpower.com or follow the cooperative on Facebook, X (formerly Twitter), LinkedIn, YouTube, and Instagram.

About Tri-State Generation and Transmission

Tri-State is a power supply cooperative of 45 members, operating on a not-for-profit basis, including 42 utility electric distribution cooperative and public power district members in four states. Together with our member/owners, we deliver reliable, affordable and responsible power to more than a million electricity consumers across nearly 200,000 square miles of the West. For more information about Tri-State, visit www.tristate.coop.

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Impact to be Spread Across All Rate Classes

United Power members will see a rate increase effective for usage beginning Jan. 1, 2024. United Power Board members and staff recently reviewed the cooperative’s costs and determined that rates need to be raised an average of 9.5% to help the cooperative maintain a healthy financial profile.

“These decisions are always difficult, and the Board carefully scrutinized spending in all areas across the cooperative before reaching the conclusion that rates need to be increased,” stated Mark A. Gabriel, President and CEO. “Your cooperative has worked hard to keep costs as low as possible for members during the last three years, especially when inflation began to impact the cost of nearly everything we need to maintain normal day-to-day operations. While we knew this effort was only a delay tactic, we really aimed to keep rates stable for members while costs for everything else in their households were rising.”

Average Household to See $10-$15 Increase Monthly

The average residential member will see increases in both the demand charge and in the energy charge, while the fixed charge will remain the same. The demand charge will increase from $1.50 to $2.50 per kW, while the energy charge will increase from 9.95 cents per kwh to 10.39 cents. 

The average household on the standard residential rate using about 850 kwh per month with a demand of 7 kW will see their bill rise from $114.08 to $124.82, an increase of $10.74. 

Residential time-of-use members will see a similar increase, with an increase in demand from $1.50 to $2.50 per kW. On-peak energy charges will rise from 15.4 cents to 16.07, and off-peak energy charges will increase from 5.25 cents per kwh to 5.5 cents. All other rates will see similar increases. See full menu of rate changes here. 

The cooperative’s rate model forecasts that most households will see a $10-$15 per month increase in their electric bill. However, the structure of United Power’s rates provides members the ability to keep costs lower by controlling demand. Reducing demand is as simple as not using electric appliances at the same time. Additionally, setting timers on dryers and dishwashers so they start after the family goes to sleep moves the demand of that appliance to a lower use period and actively reduces demand costs.

Learn more about demand and how you can reduce the impact of this portion of your bill.. 

Why are rates rising now?

It is important to understand that the cost of wholesale power makes up approximately 75% of a member’s bill. United Power’s current wholesale power supplier is planning a large rate increase in 2024, including a significant change in their rate structure. Once approved, the new rate structure will shift expenses from generation to transmission, which will have a considerable impact on United Power even after our exit. In other words, the cost to deliver power to our members will increase next year — regardless of who is generating and supplying that power. Fortunately, the cooperative will begin purchasing and managing its own wholesale power supply on May 1, 2024, giving us greater control over this portion of our power cost.  

United Power staff has kept a watchful eye on spending, particularly over the past three years, but our operation is challenged by rising costs just like most households and businesses. Unavoidable increases in property taxes and insurance premiums are impacting the cooperative. Add to this the rising cost of construction materials and critical components like transformers and wire, and it has been a challenge to balance our budgets. Even the costs for attracting and retaining talented employees continues to climb in both wages and benefits. 

How Can Your Cooperative Support You?

United Power has numerous resources to help our members manage their energy usage. Weatherization information to make your home envelope tighter, energy audits to provide tips on energy efficiency measures, rebates to support purchasing energy efficient appliances, and information on lifestyle changes that can help reduce costs are all ways we put the power to control costs in our members’ hands. 

If you need help managing your electric costs, please feel free to contact us for assistance. Members may reach United Power by phone at 303-637-1300, via email, or by chat at www.unitedpower.com during normal business hours.

United Power Announced Three New Power Purchase Agreements in July

United Power recently announced three new power purchase agreements in advance of its upcoming exit from its current wholesale power contract with Tri-State Generation and Transmission in May 2024. The cooperative has reviewed dozens of power supply proposals over the past several months to determine the most fiscally and socially responsible partners moving forward. Finding and securing established partners in the energy industry will not only ensure sufficient power supply is available for United Power’s growing load, but having multiple agreements also presents added flexibility for the cooperative’s power mix.

United Power tried to no avail to negotiate more contract flexibility and lower costs on behalf of its members. These costs are above market value, accounting for more than 70% of the cooperative’s operating expenses. Further, the existing contract locks United Power into a restrictive generation mix and prevents it from obtaining more than 5% of its total load from locally generated sources, such as utility-scale solar farms, gas-capture facilities, or even residential rooftop solar. The cooperative’s  power purchase agreements announced in July demonstrate the freedom available by exiting its current wholesale power contract next year. 

Two of the three agreements will facilitate a large portion of United Power’s expected load when the cooperative exits its current contract. The cooperative’s load is presently the largest among Colorado distribution co-ops — at more than 630 megawatts (MW) — despite serving the smallest geographic footprint. The third agreement is an innovative battery storage solution that will help mitigate costs when power demand is high — also known as peak demand. 

“The energy industry is entering a period of revolutionary change,” said Mark A. Gabriel, United Power’s President and Chief Executive Officer. “We have always put our members first and will continue to do so while advancing our position as an industry-leading distribution cooperative. Leaving our restrictive wholesale power contract affords us the flexibility and freedom to keeps rates competitive, join national power markets, and attract innovative energy partners.” 

As the exit date approaches, questions about the cooperative’s future have started to circulate. It is important that members know the upcoming power supply transition will not impact your membership with the cooperative. United Power will continue as your power provider. New power suppliers will allow the co-op to better serve its members, who can expect the same commitment to delivering reliable and economical electricity to local homes and businesses. Office locations in Brighton, Coal Creek, and Carbon Valley will also still provide the service and support members have come to expect.  

Guzman to Provide Key Power Block

United Power’s power purchase agreement with the Denver-based power supplier Guzman Energy locks in one-third of the cooperative’s power needs beginning in May 2024. The 15-year agreement features fixed wholesale power pricing that provides prearranged power supply costs and rate stability for members. 

Guzman partners with cooperatives, municipalities, companies, and tribes across North America to customize energy portfolios that make economic and environmental sense.

New Utility-Scale Solar Addition

United Power signed a 25-year power purchase agreement to receive power from Whetstone’s Solar of Alamosa project in Southern Colorado. It will add 30 MW of renewable energy to the co-op’s diverse portfolio of generation resources beginning in 2024. 

The solar farm sits atop one of the state’s highest elevation plateaus and receives some of the highest irradiance in the country. Built in 2012, project upgrades are scheduled throughout 2024 to achieve optimum power output. 

Ameresco’s Largest Battery Project

United Power and Ameresco will partner to connect nearly 80 MW/315 MWh of battery storage capacity throughout the cooperative’s service territory. The groundbreaking project will allow United Power to balance its load while integrating renewable resources. Batteries will be located on eight different cooperative-owned substation sites in Adams, Broomfield, and Weld counties, storing and dispatching power during heavy consumption periods. 

Xcel Energy to provide United Power and its members with excess low-carbon, renewable electricity

Brighton, CO – United Power an electric cooperative serving Colorado’s northern Front Range, and Xcel Energy, one of the nation’s largest investor-owned utilities, entered into a strategic relationship to explore opportunities for maximizing the value of their combined portfolios and advancing the State of Colorado’s progress toward a low-carbon energy footprint. The utilities are entering a power supply arrangement that would provide United Power access to Xcel Energy’s increasingly carbon neutral portfolio to the benefit of Xcel Energy customers and United Power members. The working agreement will allow both utilities to leverage cost savings through power purchases while continuing to invest in new, clean renewable resources.

“This is a win-win for both utilities,” stated Mark A. Gabriel, President and CEO of United Power. “The ability of two large utilities working toward a common goal will benefit everyone. Together we will plan our energy needs, negotiate lower pricing, and assure reliability for our members and customers. This is an important step as we enter the new future of electric procurement and delivery.”

The agreement aims to facilitate a shared strategic vision for electric power delivery. Xcel Energy seeks to leverage its renewable energy resources by making sales to United Power at times when excess energy is available, providing United Power with access to Xcel Energy’s significant portfolio at attractive prices. The two utilities hope to develop a long-term relationship in which both will work in tandem to drive down power costs, understand how best to serve the future load of the cooperative’s members and Xcel Energy’s customers, and work toward the mutual goal of integrating more renewable energy in support of the State of Colorado’s renewable resource goals.

“The electric industry is changing, and United Power is working with Xcel Energy to help lead this revolution,” stated Gabriel. “Meeting federal and state requirements, keeping costs economical, and making certain our load is predicable are planned outcomes of this strategic relationship.”

United Power is preparing for an exit from its current wholesale power contract with another power supplier on May 1, 2024. The electric cooperative has been securing a variety of power generation contracts to continue to supply its members following its exit from the contract.

“Today’s announcement solidifies our close working relationship with United Power, one of the largest and fastest-growing cooperative utilities in Colorado, by supplying increasingly carbon-free energy from Xcel Energy’s generation resources,” said Robert Kenney, President of Xcel Energy-Colorado. “Our strategic relationship will maximize the value of both companies’ combined generation towards achieving our goal of reducing carbon emissions by 80% by 2030, from 2005 levels, and providing 100% carbon-free electricity by 2050.” 

United Power serves nearly 110,000 meters and maintains and operates over 6,500 miles of distribution line. The 900-square mile service territory wraps around the north and west borders of the Denver International Airport. It includes the north and northeast metropolitan development corridors along Interstate 25, Interstate 76, State Highway 85, and E-470 and the Golden Gate and Coal Creek canyons, two of Colorado’s most iconic and historic mountain canyons. As a result of its geographic location, United Power’s system is experiencing significant demand and energy growth, averaging approximately 6% annually.

To learn more about United Power’s power supply transition, visit Power Supply.

About United Power

United Power is a member-owned, not-for-profit electric cooperative, delivering electricity to homes, farms, and businesses throughout Colorado’s northern Front Range. The cooperative is one of the fastest-growing electric co-ops in the nation, and in June 2021 joined the elite ranks of cooperatives serving more than 100,000 meters. The 900-square mile service territory extends from the mountains of Coal Creek and Golden Gate Canyon, along the I-25 corridor and Carbon Valley region, to the farmlands of Brighton, Hudson, and Keenesburg. United Power is also a founding member of the NextGen Co-op Alliance, which is dedicated to expanding the power supply and procurement options available to distribution co-ops and reforming the traditional generation and transmission business model. For more information about United Power, visit www.unitedpower.com or follow the cooperative on Facebook, X (formerly known as Twitter), LinkedIn, YouTube, and Instagram.

About Xcel Energy

Xcel Energy (NASDAQ: XEL) provides the energy that powers millions of homes and businesses across eight Western and Midwestern states. Headquartered in Minneapolis, the company is an industry leader in responsibly reducing carbon emissions and producing and delivering clean energy solutions from a variety of renewable sources at competitive prices. For more information, visit xcelenergy.com or follow us on X, formerly known as Twitter, and Facebook.    

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