Board approves budget with no change to average wholesale electric rates
Great River Energy won’t change its average electric rate when the cooperative begins a new fiscal year on Jan. 1, 2020.
The recent approval of Great River Energy’s 2020 budget with flat average wholesale rates fulfilled a promise the cooperative made to its membership at its June annual meeting.
“We are a member-owned cooperative. When our members want something from us, we do our best to provide it,” Great River Energy Vice President and Chief Financial Officer Michelle Strobel said.
Wholesale electricity represents over half of the costs for each of Great River Energy’s 28 member-owner cooperatives, many of which have seen electricity sales growth slow in recent years. Great River Energy forecasts 2020 energy sales to increase 1.2% over 2019.
Great River Energy achieved flat rates through traditional budget measures such as cost reductions. More importantly, however, flat rates stemmed from the lasting benefits of pivotal decisions made over the past five years.
Great River Energy closed two power plants that were no longer economical to operate, modified the dispatch of its generation facilities to be more efficient and reduced its debt levels resulting in less interest expense.
“Smart, strategic moves have tempered upward pressure on rates. We achieved our goal for 2020 and continue our work to keep costs competitive long into the future,” Strobel added. Great River Energy forecasts wholesale rates to remain relatively flat over the long term.
Great River Energy’s 2020 budget projects revenues and expenses of $975 million and total capital spending of $143 million. The cooperative also plans to return nearly $6 million in patronage capital to its member-owner cooperatives.