Navigating Challenges

Raft River Electric is committed to finding the best future power supply and contracts

Story and photos by Dianna Troyer

Finding diverse sources of electricity to help stabilize future rates will be a priority for Raft River Rural Electric Cooperative Board members in the coming years.

During the 86th annual meeting in early April, co-op members learned about future sources of electricity in addition to longtime provider Bonneville Power Administration.

Board President John Campbell said the co-op reaps numerous benefits from being a longtime member of PNGC Power, a generation and transmission cooperative representing 25 utilities with service territories in seven Western states.

“They’re a lifeline to tackle complex rate issues facing us in the future,” he said.

He introduced special guest Jessica Matlock, CEO of PNGC Power.

“PNGC’s current membership size makes it BPA’s largest preference customer,” she said. “As a bigger collective group, we will have more of a say when negotiating with BPA. PNGC Power is a way for small communities to have a voice.”

BPA, established by Congress in 1937 to provide at-cost electrical power from dams in the Pacific Northwest, has constraints.

“They’re nonprofit and have to make cost and rate adjustments every two years to maintain that status,” Jessica said. “How can we obtain stable rates and diversify so we’re not so dependent on one source to meet electrical needs while at the same time be protected and have limited exposure to rising volatile market rates?”

She hopes to obtain wholesale electricity from other sources, including natural gas, geothermal and solar.

“We need to have local control, reliability and stable power prices,” Jessica said.

John attributed Raft River Electric Cooperative’s continued success to employees living in a mountain valley culture and community, where people care about each other and work hard.

“We had a successful year, and the co-op continues to be financially sound,” he said. “We have the best employees in the country who are effective and safe. They attend regular safety meetings and work as a team. We all benefit from that.”

The co-op has also benefited from BPA’s distribution of over-collected revenues, which was applied as a credit on the co-op’s monthly power bill over the past two years.

Likewise, when the co-op brings in money in excess of expenses, it returns the surplus to members as capital credits

“It’s similar to paying back a loan to members,” John said. “We spread out the cost of infrastructure over time to all the members present and future.”

This year, the board allocated $1.5 million in capital credits, retiring patronage from 1996 and part of 1997.

At the same time, the co-op maintains healthy equity reserves in case of uncontrollable income variables, such as weather. For example, in wet years when irrigation demand decreases and results in an income decline for the co-op, there is enough equity to cover the downturn.

John encouraged members to be mindful and support politicians who support reliable production of electricity.

General Manager Chad Black is also a board member of PNGC Power.

“It’s always a pleasure to be here for our annual meeting,” Chad said. “I’m reminded of those who started our co-op and had the courage to make sure future generations would have electricity in their homes and be able to pump water. I’ve lived in places without electricity where people had to boil and strain water to drink. That’s why I’m so committed to have reliable, safe, economical electricity. It impacts our lives on a daily basis.”

When facing challenges and making decisions, Chad said the co-op staff and board members understand every choice they make has lasting consequences.

The board strives to ensure equity among members while also balancing the need for sufficient capital credit retirements, maintaining appropriate equity levels and anticipating future rate increases.

After keeping rates steady for seven years, a rate adjustment was approved by the board and implemented in April. The rate adjustment is attributed to several factors. During the past several years, unprecedented inflation drove up the cost of wholesale power and equipment. Wholesale power is the co-op’s greatest expense, totaling about 60% of the co-op’s costs. Approximately 24% of the budget is spent on operations and maintenance.

BPA also faced inflationary factors along with increasing electrical demand and regulatory requirements concerning the amount of water spilled at dams.

In other business, the co-op’s financial records, including balance sheets and cash flow, were reported as fair and accurate by auditor Michael Burton, of DeCoria & Co.

Bylaw Changes and Election Results
Bylaws concerning a quorum definition and uncontested board of director positions were amended by the members.

A quorum is now defined as “the number of voting members present at the regular annual meeting of the members.”

The amendment requires at least 75 members to be present to conduct business at special meetings of the members.

The amendment also states if only one qualified candidate is running for a board of director position, no ballots will be distributed. Instead, the candidate will be elected by declaration.

Uncontested incumbents Jason Harper, at-large, and John Campbell, District 1, were reelected.

Scholarship and Prize Winners
Education grants were awarded to five high school seniors as a way to pay it forward.

Recipients, picked at random from those who entered their names in the drawing, were Ashlee Christensen, Sadee Knudsen, Reigan Esquivel, Kaylee Eddington and Blake Tracy.

In final business, Marta Hernandez was the winner of a Blackstone grill.