CEC Announces Rate Increase Effective January 2016
Due to the impacts of an October 1 increase in the wholesale rates the Bonneville Power Administration (BPA) charges Central Electric and other electric cooperatives, CEC will implement a 5.7 percent rate increase effective with January’s bills. The increase will be applied uniformly to all energy, facilities, and demand charges.
Central Electric’s review concluded the 7.1 percent average increase in BPA’s wholesale electricity rates and its 4.4 average increase in transmission service rates could not be absorbed without negatively impacting the co-op’s financial strength. BPA has increased its wholesale electricity rates 23.9 percent and its transmission rates 15.4 percent since October 1, 2011. During this same period, CEC absorbed almost all of the BPA increases and raised rates only one time, 2.8 percent on January 1 this year. The upcoming increase is just CEC’s third since 2001.
“This decision was driven by costs we cannot control and BPA’s rates are in this category,” said Dave Markham, CEC president and chief executive officer. “We practice great discipline when managing the costs within our control. We have kept staffing levels under those in place 15 years ago despite a nearly 40 percent increase in accounts served and the continued growth of our electrical system during that time.”
As a result of the upcoming adjustment, CEC’s 12-month average residential rate will increase from 7.43 cents per kilowatt-hour to 7.85 cents and the typical CEC member’s monthly bill will go to $122.67 from $116.10. This includes the co-op’s monthly facilities charge that increases from $12.08 to $12.77.
“We understand that these increases will cause difficulty for some of our members,” said Markham. “I assure them that the decision to increase member rates was because failing to take this action would undermine our ability to keep the cooperative operating safely, efficiently and reliably. No one associated with CEC wants to see that happen.”
Markham noted that following the increase, the monthly cost for 1,400 kilowatt-hours — the average CEC residential member’s usage — will be 23 to 25 percent below the state’s investor-owned electric utilities. The cooperative’s new residential rate will be 37.6 percent lower than the national average and 25.3 percent below the Oregon average, according to the U.S. Energy Information Administration’s 2014 data, the most recent available.
Central Electric Cooperative, Inc. Background
A member-owned, not-for-profit electric cooperative, Central Electric Cooperative (CEC) has provided electric utility services to its members in central Oregon since 1941. At the close of 2014, CEC served 32,097 accounts held by 25,732 members in its 5,300 square-mile service territory in Deschutes, Crook, Jefferson, and parts of Lake, Linn, Wasco, and Grant counties. CEC’s electrical system includes 24 substations and 3,851 miles of energized power lines, including 183 miles of transmission line, 2,262 miles of overhead distribution line and 1,406 miles of underground distribution line.