President’s Reports

President's Report

Safety, Safety, Safety

January’s storms of high winds, snow, freezing rain, ice and frigid temperatures imposed chaos throughout the Pacific Northwest.

Most troubling was the tragedy in Northeast Portland when three family members were electrocuted when they tried to save a baby from their car, which had a live, downed power line on it. A heroic 18-year-old woman somehow— unexplainably and thankfully—saved the 9-month-old baby.

The incident is a sober reminder these accidents occur more often than you think. In the United States, approximately 1,000 people die annually as a result of electrical injuries. Of these, nearly 400 are due to high-voltage contact.

Electricity plays an essential role in our lives, powering our homes and workplace devices, appliances and equipment critical to our comfort, enjoyment and daily tasks. When used correctly, electricity is a safe energy source. However, being unaware of your surroundings can result in electrical shock or death.

Electricity always seeks the path of least resistance to the ground, as the electrons move freely through conductors such as wire, metal pipes, poles, ladders and humans.

With winter transitioning into spring, efforts begin to prepare fields for planting and irrigation, and it is not uncommon for electrical accidents to occur. Workers are at risk as they move irrigation pipes stored under power lines. Before moving pipes, look up and live.

The same applies to construction workers and home improvement enthusiasts moving ladders, tools or other objects. Many of us have an overhead line that feeds from Central Electric Cooperative’s system to our homes. Stay clear of the lines and avoid extending ladders, tools or other objects into them.

Spring brings growth spurts to trees and other vegetation. Keep an eye out for trees and limbs nearing contact with the power lines, as they pose a safety hazard and threaten your service’s reliability. Call CEC, and we will arrange for a professional tree trimmer to do the work at no cost to you.

If you plant trees or shrubbery this spring, do not plant them under the power lines, where they may pose a risk in the future.

Lastly, treat all downed power lines as live wires. Never approach or move downed power lines. Always assume they are energized. If you are in your vehicle and a power line has fallen near or on your car, stay put and immediately call 911.

CEC is committed to keeping our employees and members safe. I encourage you to visit our website for more information and safety tips at www.cec.coop. If you have further questions, call a customer service representative at 541-548-2144.

President and CEO Brad Wilson

 

President's Report

Settlement Details Pose Risk

Last month on this page, I highlighted a secret deal between plaintiffs and the federal government regarding the Federal Columbia River Power System operations.

Central Electric Cooperative relies on the FCRPS for nearly all of its wholesale electricity. The recent agreement could have long-term adverse impacts on rates and system reliability.

Since 1992, litigation has persisted on how to operate the FCRPS to balance the needs of salmon and electric ratepayers.

Sixteen months ago, the federal district court judge overseeing the latest round of litigation approved a stay, while the White House’s Council on Environmental Quality engaged federal mediators to resolve the litigated issues, resulting in the federal government and the six sovereigns—four federated tribes and the states of Oregon and Washington—striking a deal behind closed doors.

Several Pacific Northwest congressional members leaked the agreement once they learned of it to spotlight the lack of transparency and involvement of stakeholders, including public power.

Since then, public power has gained a greater understanding of the deal’s implications. The outlook is grim.

The agreement:

Shows a clear path toward breaching the Lower Snake River dams.

The dams represent 12% of the Bonneville Power Administration’s total generation, which is affordable, reliable, clean and environmentally responsible power. The dams also play a critical role in keeping the lights on during extreme weather events.

The agreement calls for feasibility studies, the first step toward breaching the dams.

Exposes BPA and its public power customers to tremendous financial risk with the cost of replacing lost generation.

The early estimated cost is $2 billion to $6 billion to bring renewable energy—a variable and intermittent resource—to replace the 24/7 firm hydropower resource, a system already in place with a proven track record. BPA has estimated this replacement resource would cost $415 million to $860 million annually, equivalent to a 21% to 43% increase in BPA power rates.

Creates uncertainty in operating the Federal Columbia River Power System.The agreement calls for adaptive management of the hydropower system, allowing the six sovereigns to make decisions without any protection or standards for the power system impacts.

The result will lead to less available hydroelectricity at a much higher cost.

Will not stop lawsuits and claims.

While the six sovereigns agree to not pursue litigation during the next five years, entities not bound by the agreement or not parties to the case can bring lawsuits.

At this writing, two lawsuits and a claim have already been filed since the agreement became public. Parties may also continue to litigate against BPA’s rates, budget and other agency proceedings.

CEC and the public power community are seeking ways to protect its investment in the FCRPS to ensure hydroelectricity is affordable and reliable while exploring potential alternative power resources.

I will continue to keep you apprised as developments occur.

President and CEO Brad Wilson

 

President's Report

Secret Deal Creates Uncertainty

As a not-for-profit member-owned utility, certainty is imperative. Central Electric Cooperative wants to be certain now and in the long term that the electricity it provides to its members will remain clean, affordable and reliable.

CEC has had this certainty for decades due to the longstanding relationship with the Bonneville Power Administration, which markets the energy output from federal dams on the Columbia and Snake rivers. However, litigation over the hydropower system has created more uncertainty than ever before.

Special interest groups have used the litigation system for decades in pursuit of dam removal, including suing the federal government regarding a recent record of decision that did not endorse their desired outcome: breaching the lower Snake River dams.

The White House Council on Environmental Quality has injected itself into the process, participating in confidential mediation with only select stakeholders to set them on the pathway toward reaching their desired goal.

Rural electric cooperatives and other public power utilities pay for the operation and maintenance of the federal Columbia River System Operations, funding more than $685 million annually for fish and wildlife programs. Despite underwriting the entire system, public power had no representation at these closed-door meetings.

Once the details leaked from the secret negotiations, public power utilities learned of an agreement between the plaintiffs and the federal government. This agreement fails to protect BPA and exposes its customers to new costs, operational changes, and more lawsuits and claims, translating into billions of dollars in new expenses—at the cost of ratepayers.

Disturbingly, this agreement could imperil a valuable resource critical to ensuring system reliability, meeting our carbon reduction goals, electrifying our economy and integrating new renewable resources.

We need your help to put some common sense and transparency in this process. We need elected leaders, such as Gov. Tina Kotek and Oregon’s congressional delegation, to stand up for our communities that depend on federal hydropower. If they don’t, the only certainty is the electricity we provide you will be less affordable and reliable.

Brad Wilson

President and CEO

President's Report

Central Electric’s Year in Review

While change is constant, Central Electric Cooperative’s mission stays the same every year: deliver our members safe, clean, reliable electricity at the lowest possible rates.

This year, CEC’s most significant change was saying goodbye to former President and CEO Dave Markham, who retired after 26 years of dedicated service.

Stepping into this role in July, my goal was simple: to ensure a seamless transition dedicated to carrying out CEC’s mission while positioning the cooperative to be successful in a rapidly evolving industry.

Key Highlights

Strategic investment initiative. CEC is in the middle of a decade-long capital improvement plan to strengthen and upgrade our infrastructure.

A prime example is the ongoing work to increase the capacity of our 3.5-mile transmission line from the Bonneville Power Administration’s Redmond Substation to CEC’s Cline Falls Substation in Eagle Crest.

Initially built in the 1950s, the 69-kilovolt line is being converted to a 115-kV line to meet the increasing demand for electricity while enhancing safety, reliability and resiliency for our communities.

From 2017 until the end of this year, CEC will have replaced 1,682 aging poles, buried 26 miles of cable in conduit and upgraded five substations to meet anticipated future members’ energy demands.

Wildfire mitigation. Vegetation management is essential to wildfire mitigation, requiring crews to patrol, identify, trim or remove overgrowth and hazard trees that pose a risk to power lines in rights-of-way throughout high-risk wildfire areas.

This year’s efforts occurred along Highway 126 west of Redmond and a section of the Brooks-Scanlon Logging Road outside Sisters. Tree trimming contractors eliminated 150 juniper trees in a 3-mile stretch adjacent to the highway. In the Sisters area, they removed a mix of 300 junipers and pines in 10 miles of rights-of-way.

Combating rising costs. Maintaining a high level of service and delivering affordable power to members has its challenges. The rising cost of energy, inflation and ongoing capital improvements required CEC to implement rate changes effective January 2024. To learn more, see pages 4-5.

Looking ahead, CEC and other consumer-owned utilities are negotiating with BPA on a new 20-year, post-2028 contract, asking BPA to provide more options to help CEC provide you with the lowest-cost power.

I take confidence in members’ support as expressed in the member satisfaction survey conducted earlier this summer. You gave the cooperative an overall satisfaction score of 90%, with high marks in providing member benefits of system reliability and residential rates significantly lower than the local investor-owned utility.

As the new year brings change and unexpected challenges, you can rely on CEC and its employees to consistently put members’ needs first.

Brad Wilson

President and CEO

President's Report

2024 Rate Changes

As a member-owned, not-for-profit utility, Central Electric Cooperative proudly serves its members clean, safe, renewable electricity near the lowest rates in the state and country. We are facing challenges in the current economic climate as we try to meet CEC’s mission to provide the highest quality electric service at a reasonable cost.

CEC has successfully maintained rates since 2020, but due to the Bonneville Power Administration’s increased cost for power, dramatically inflated prices for electric equipment, and the co-op’s ongoing investments in updating its electric infrastructure to maintain a modern and reliable system, CEC must implement a rate change impacting all customer classes effective January 1, 2024.

As economic conditions have changed, CEC conducted a cost-of-service analysis—a fundamental tool to evaluate and design rates to cover the costs of providing power—and engaged our member rate design advisory committee representing all customer classes.

The committee reviewed the COSA results and recommended rate changes to meet revenue requirements, which the board of directors adopted in September. Depending on their monthly use, CEC’s residential members will see a 5% to 7% increase on their bills.

BPA’s hydropower generation supplies nearly all of CEC’s wholesale electricity, and its rate increases are beyond CEC’s control. BPA adjusts its rates every two years due to increased operating costs and capital spending. The 2024-2025 all-in rate, which includes power and transmission costs, has a substantial financial impact on CEC.

The region also feels the lingering adverse financial impacts of the COVID19 pandemic: inflation and supply chain delays. Just as consumers have seen a dramatic increase in costs for goods— including gas, food and services— inflation has also hit the electric utility industry hard.

Since 2019, the cost of a power pole has risen by 35%, overhead power cables by 45%, underground power cables by 79% and a single-phase (residential) transformer by almost 100%. If ordering the equipment today, the price tag would likely be higher upon receipt of the materials due to extended supply chain delays.

These price increases reduce the co-op’s purchasing power, adversely impacting the $147 million allocated for CEC’s decadelong strategic investment initiative. In its fifth year, this essential initiative funds the replacement of aging power poles and underground cables to ensure continued safety, efficiency and long-term reliability. The effort includes the co-op’s wildfire mitigation plan, requiring equipment upgrades, deploying new technology and aggressively conducting vegetation management.

Funding also goes toward expanding capacity at new and existing substations to meet Central Oregon’s growth and continued maintenance activities to provide safe and reliable power for our members and communities.

Look for more information in the December issue of Ruralite. To see how the rate changes will affect you, use the rate calculator on CEC’s website, https://www.cec.coop/rate-changes-faq.

 Brad Wilson

President and CEO

President's Report

Member Survey Says?

Central Electric Cooperative members who participated in our member satisfaction survey in June gave us an overall satisfaction rating of 90%, with 70% being very satisfied. The results are well above the 73% national average for cooperative energy utilities.

The online survey–generally done every two years–allows co-op members to assess performances in key areas, ranging from reliability to customer service.

As in previous surveys, members continued to give the co-op high marks in the following service areas:

  • Dependability of electric service, 97%
  • Restoration of service when power outages occur, 88%.
  • Keeping members informed of changes affecting service or rates, 85%.
  • Employees’ knowledge and helpfulness, 83%.

When it came to ranking the most important membership benefits, system reliability finished first. A strong second was residential rates that are 30% lower than the local investor-owned utility.

The survey also included questions to gauge members’ support for the co-op’s ongoing wildfire mitigation efforts. Members overwhelmingly supported activities related to wildfire mitigation, including tree trimming, property access and deploying innovative technology to detect potential issues on the system. While there was less enthusiasm for Public Safety Power Shutoffs overall, members living in high-risk wildfire areas were more inclined to support the effort as needed.

I encourage you to read pages 28-29 for a more comprehensive overview of the results.

More than 4,100 members participated, representing almost 14% of the co-op’s entire membership–our highest participation ever. In addition, we received more than 2,400 member comments to review. When CEC last issued a survey in 2019, a little more than 2,700 members took the survey.

Several factors may contribute to the increased participation. This year’s survey provided members their first opportunity to offer input in almost four years, and they were eager to be heard. Our aggressive marketing efforts through Ruralite, SmartHub and social media expanded our reach to new and younger members. The potential for members to receive a $500, $250 or $100 energy credit through a random drawing also served as a motivator to participate. See page 25 to learn about the winners.

The survey results tell us how we may serve our members more effectively. For instance, some feedback via comments said how we could better communicate with members.

Beyond the traditional forms of communication, including Ruralite, our website and social media, CEC recently adopted new technologies within SmartHub to allow members to use their preferred communication choice, whether it be text, email, letter or the SmartHub mobile app. To learn more, to to your SmartHub account to manage notifications. Not signed-up for SmartHub? Visit our website at www.cec.coop or call a customer service representative.

Thank you to everyone who shared their thoughts. The input is extremely valuable as we plan for the future. We plan to conduct the next survey in 2025.

 

President's Report

CEC Employees Are Crucial to Co-op’s Success

The first Monday of every September is Labor Day, a holiday celebrating the American worker. It is an opportunity to pay tribute to those who display their resilience, dedication and collaboration throughout the year.

These attributes reflect your rural electric cooperative employees–past and present–who have worked tirelessly to keep members’ lights on since the co-op’s inception.

In Central Oregon, nine farmers embodying that spirit banded together in 1938 to form a cooperative to bring electric service to rural areas when other utilities showed no interest. The farmers’ vision and efforts culminated in the formation of Central Electric Cooperative, Inc. in 1940. With their labors, and electric system began to take shape.

On May 17, 1941, with a light spring snowfall, the founders flipped the switch at Deschutes Junction Substation midway between Redmond and Bend. The lights came on, illuminating 11 farms in the area and providing the first electric service to CEC’s founding members.

The first full-time lineworker, hired in 1941, initiated the slow growth in crew and other personnel, totaling seven by the end of World War II. These employees managed an electric network of 250 miles and delivered power to 600 members.

Today, CEC has more than 30,000 members and nearly 4,000 miles of power lines in a 5,300-square-mile service territory overlapping five counties. Our members are residents, farmers, ranchers and businesses, including St. Charles Hospital in Bend.

CEC’s employees are crucial to the cooperative’s success.

Operations employees work in various types of high desert weather conditions, from summer’s extreme heat to winter’s subzero temperatures. They must respond to service interruptions, build large projects and maintain the electric system to provide safe and reliable power to our members and communities.

CEC’s workforce is so much more than just the outside employees. CEC customer service representatives courteously greet members at the front desk or by phone, ready to answer their questions and provide or direct them to the information regarding the co-op’s numerous products and programs, ranging from energy efficiency and rates to financial assistance.

CEC’s member services personnel support the organization’s external and internal communications with the members always in mind.

Behind the scenes, the engineering department meticulously designs and maps the ever-growing system to safely and reliably meet load growth. Logistics employees procure and maintain a vast inventory to meet this load growth.

Information and technology staff consistently maintain and upgrade infrastructure to enhance operations and reduce cyber-security risk. Administrators and finance personnel effectively manage costs within their control to keep rates low, while management guides the co-op through a rapidly transforming and evolving industry to meet CEC’s long-term goals.

Throughout the years, CEC has built an excellent reputation as one of the best service-oriented companies in Central Orgon, and that is because of its employees.

While we officially observe Labor Day one day a year, I am thankful throughout the year for the co-op employees who serve our members.

Brad Wilson, President and CEO

President's Report

Ready to Lead the Cooperative

I am honored to be Central Electric Cooperative’s new president and CEO. I was raised in Central Oregon and have served CEC in various roles for 26 years.
There is no other place I want to be.

Before looking forward, I want to reflect and recognize my predecessor Dave Markham, who worked tirelessly the past two decades to solidify the utility’s long-term financial stability and transform CEC into an exemplary leader in the state and federal legislative and regulatory arenas. I could not ask to inherit a better position.

Fortunately, I have been there every step of the way to learn and understand how to manage the cooperative successfully. My roles evolved from journeyman lineman to director of operations and engineering and then chief operating officer.

The experience has taught me the not-for-profit business model, given me intimate knowledge of our service territory’s infrastructure and helped me value the employees who keep the lights on.

Along this road, major mile markers for me include managing the rollout of CEC’s advanced metering infrastructure, developing and implementing its wildfire mitigation efforts, and ongoing infrastructure improvements to provide you with safe, reliable and affordable electricity.

The electric utility industry faces many ongoing challenges, and we still feel the lingering effects of the COVID-19 pandemic: rising inflation, supply chain delays, a slowing economy and increased power costs.

An additional layer of complexity is the state’s decarbonization and renewable energy goals. Bringing online intermittent solar and wind resources raises numerous short- and long-term resource adequacy concerns. While the clean, renewable hydropower energy—100% carbon-free—supplied by the Bonneville Power Administration serves as CEC’s energy backbone, we must be visionary and creatively proactive in augmenting our primary energy resource to meet Central Oregon’s growth and demand for electricity.

CEC—built to deliver power to farms and ranches outside the city core areas along Highway 97—is one of the fastest-growing utilities in the state. Rapid growth has brought more suburban and commercial demand into our service territory. We must continue to build new infrastructure while replacing aging equipment in outlying areas.

While change is inevitable, the core of CEC’s success is its members and employees. The co-op wouldn’t exist without both. On behalf of our members, we must continue to value and uphold the Seven Cooperative Principles, including Democratic Member Control and Concern for the Community.

CEC puts a high premium on its workforce for its safety and retention. Staff members are diligent, flexible and ready to assist. Because of them, CEC is well prepared for challenges as they arise.

When thinking of CEC, the words commitment and ownership immediately come to my mind. They are shared collectively by the board of directors, management and employees.

Keeping those principles in mind, I am grateful for this opportunity and ready to lead.

Brad Wilson, President and CEO

President's Report

Take Advantage of CEC’s Energy-Efficiency Programs

Central Oregon’s high desert is no stranger to extreme temperatures. Arctic bomb cyclones and summer heat domes come and go, imposing below-zero to triple-digit temperatures, setting records in their wake.

These weather events can adversely affect your electric bills. Central Electric Cooperative wants to serve as your trusted energy adviser to help you maximize saving and experience year-round comfort while having a home that benefits from greater efficiency.

Members have benefitted from our numerous energy-efficiency, heat pump and electric vehicle programs, receiving $700,000 in rebates funded through the Bonneville Power Administration and CEC.

Last year, our energy-efficiency programs saved members 2.1 million kilowatt hours–enough to power 130 CEC homes.

Working with BPA, CEC has developed multiple energy-efficiency programs to help all members.

Here are a few highlights of our residential programs.

Heat pumps and duct sealing. Heat pumps may save, on average, 25% to 50% off the heating and cooling portion of your electric bills because they move heat instead of generating heat, requiring less energy. CEC offers a cash discount of $250 to $1,450 on the cost of a heat pump, depending on its efficiency and the existing system. You must use a CEC program authorized contractor to receive the discount.

Heat pump water heater. These water heaters can save you more than 60% on the water heating part of your electricity bill. The equipment pulls in air from the space around it, extracting heat from the air and transferring it to the water tank via a refrigerant coil. CEC offers a $1,000 rebate, and a federal tax credit of 30% is available for certain installations.

Weatherization program. CEC offers insulation and window rebates to members living in older, electrically heated homes. Rebates vary depending on the project, and project materials must meet program requirements.

Smart thermostats. CEC offers a $140 rebate for upgrading to a qualified smart thermostat in your electrically heated home. On average, these smart thermostats can save you 8% to 15% annually on your heating and cooling costs. Visit our website for a list of qualifying thermostats.

Income-qualified programs. CEC has partnered with NeighborImpact to offer special incentives and resources for income-qualified households. The program is for renters or homeowners. It covers site-built or manufactured homes, and can provide free home weatherization and a heat pump. Call us to find out more information.

CEC also has rebate programs for irrigation accounts, commercial and industrial members, and electric vehicle owners.

To learn more about these programs, visit www.cec.coop or call 541-548-2144 to speak with an energy specialist. They can determine the best path forward by answering your questions and performing an energy audit at your home if needed. If you qualify for an income-qualified program, they can connect you with NeighborImpact.

We can help improve your quality of living, no matter what the weather.