This past summer, I attended the Oregon Rural Electric Cooperatives Association mid-year meeting, where an industry economist presented some eye-opening data. I knew Coos-Curry Electric Cooperative’s materials costs had increased significantly in recent years, but one slide she showed shocked me. Since 2020, many of the materials and equipment specific to the electric utilities industry have increased in cost by 50% to 100%.
Adding to these challenges, the Bonneville Power Administration started rate-making proceedings for wholesale power and transmission services for the rate period beginning October 2025. BPA is proposing an average 9.8% increase in wholesale power rates and a 21% average increase in transmission service rates.
In December, I attended a meeting with 25 CEOs of electric cooperatives from across the Northwest. During a roundtable discussion, the topic of rates came up. When it became clear that many of the co-ops are planning for rate increases in 2025, one person asked, “By show of hands, who does not plan to implement a rate increase in 2025.” No hands were raised. Some of these co-ops are implementing 10% increases on January 1, 2025.
Despite these inflationary pressures, we are working hard to keep expenses down and minimize the impact of these inflationary pressures on you, our members. Before approving the 2025 budget, the CCEC Board of Directors asked staff to reduce the proposed expense budget by $250,000. Staff sharpened our pencils and identified the requested budget cuts without compromising service quality.
CCEC has taken additional proactive steps to offset rate increases. In 2022 and 2023, BPA sold surplus power outside the region during extreme hot summer weather when demand drove market prices very high. BPA returned some of those unexpected revenues back to its customers in the form of bill credits. CCEC chose to account for those credits as deferred revenue to help mitigate future rate increases. Some of the deferred revenue was used to soften the impact of the rate adjustment in the spring 2024. More of this deferred revenue will be used to mitigate a rate adjustment later this year.
Another way we help ease rate pressure is by strategically timing rate increases. The CCEC Board of Directors has consistently chosen to postpone rate adjustments until after the winter months, when electricity use tapers off and bills are lower.
One of CCEC’s high-level strategic goals set by the board is to maintain financial integrity. That seems like a no-brainer, but as a not-for-profit cooperative, we also have the responsibility not to charge our members a penny more than we must to meet this goal.
In 2025, CCEC is planning a rate adjustment similar to the rate change made last year. We will provide you with detailed information in the coming months to help you prepare.
Brent Bischoff
General Manager and CEO