Colorado Public Utilities Commission (the “Commission”), represented by Administrative Law Judge Robert Garvey, ruled in favor of United Power in the electric cooperative’s effort to establish a “fair, just and reasonable” buyout number from their power supplier, Tri-State Generation and Transmission. The action in front of the Commission was brought late last year and today’s decision helps to establish a methodology for calculating just and non-discriminatory terms for United Power to withdraw as a member of Tri-State.
“United Power has continued to pursue this action on behalf of our members,” stated Bryant Robbins, acting CEO. “It’s our goal to provide reliable power to every family and business we serve, and to provide that power at a cost that makes sense. We carefully considered our obligations to Tri-State and developed what we believed was a fair exit cost. Should this exit charge be affirmed by the Commission, it will be up to our Board of Directors to decide if this is in the best interest of our membership.”
For nearly two years, United Power sought a fair “exit charge” from Tri-State. During the hearing, United Power presented a methodology based on their proportionate share of Tri-State’s debt which produced an exit charge of approximately $235 million, comparable to payments made by other cooperatives who have exited Tri-State. Instead of working toward a reasonable exit charge, Tri-State tried to block United Power from leaving by proposing to charge it $1.25 billion, a discriminatory amount that would have resulted in an unfair windfall to Tri-State’s remaining members.
“Access to today’s energy marketplace requires a utility to be nimble and responsive to both the energy mix and the cost to the members at the end of the line,” stated Dean Hubbuck, Chief Energy Resource Officer. “This is a momentous decision in United Power’s effort to have more control over our power mix while keeping costs down.”
“We are hopeful that the Commission affirms this decision and, while we are elated, we recognize this is just the next step in a long process,” stated Robbins. “On behalf of United Power and our Board of Directors, I want to thank Judge Garvey and the Colorado Public Utilities Commission staff for their diligence and efforts in considering this matter. We appreciate their willingness to lend their expertise and oversight to this critical matter.”