by General Manager Steve Stroshane
Happy New Year from your electric co-op. We’re grateful for your support in 2022, and we look forward to a remarkable 2023, as we celebrate Polk-Burnett’s 85th anniversary with you. This is a time to honor our history, while moving toward the future with care and consideration.
Since 1938, the co-op has been driven by a mission that’s member and community focused. We follow a strategic plan to meet industry changes and member expectations.
Our action plans are aligned with four strategic priorities:
Reliable power
Competitive rates
Employee safety and development
Member satisfaction
In this month's column, I'd like to review 2022 performance and share a preview of what's ahead for 2023.
Investing in reliable power
In 2022, our construction work plan invested $6.3 million in the electric system to reduce the number and length of power outages for members. System outages averaged less than one hour per member for the year.
We also completed a meter upgrade in 2022, with 26,000 new meters installed across the system.
In 2023, your co-op will invest another $6.3 million to ensure reliable power:
• Converting 23 miles of overhead power line to underground.
• Replacing 18 miles of aging overhead line.
• Replacing 10 miles of deteriorating underground cable.
• Upgrading substation equipment, so power can be rerouted quickly during outages.
• Clearing trees and brush from rights-of-way to improve safety and reduce outages.
New electric services are up
2022 was another strong year for new construction. Polk-Burnett is on pace to install the highest number of new electric services in recent history–with 316 new service connections through the end of November!
While construction in our service territory is positive for economic development, the co-op is experiencing the same growing pains you’re seeing in your homes and businesses—rising costs and supply chain difficulties.
Moving with care to energy that's clean and cost-effective
Polk-Burnett supports a sustainable transition to clean energy and we’re gradually investing in local solar to become less reliant on volatile energy markets. In 2022, we announced Georgetown Solar, a second utility scale solar project for our service area. Polk-Burnett is partnering with Seattle-based OneEnergy Renewables to develop a 15-acre solar site in Georgetown, about 10 miles east of our Centuria office. The 2 MW solar array will generate about 4,500,000 kWh of electricity annually, enough to power 375 homes. This will not only bring more renewable energy to the system, but it will also relieve overloading on substation equipment and help offset power market costs.
Rising power cost leads to rate increase in 2023
In 2022, we experienced rising prices in the power market. My December column alerted members that the electric cooperative is passing through power cost adjustment (PCA) charges on electric bills, due to the rising cost of fuel and materials to generate and deliver electricity.
In 2023, we are expecting a 6.5% increase in the wholesale cost to purchase power. This will lead to a rate increase for members in 2023. The co-op will need additional revenue to cover our power bill: 58% of all revenue collected from members is used to buy wholesale power. We are working on a plan to eliminate and defer other expenses to minimize the impact for members.
While it may seem to some that rates have increased over the years, we have not needed to collect more revenue with a rate increase since 2010. During the past 12 years, the employees and directors have held electric rates steady, and the co-op was able to absorb millions of dollars invested into the electric system without a rate increase, including 2011 and 2019 storm restorations, a systemwide meter upgrade and our annual power line construction work plan to keep us in the top 25% of all co-ops for reliability.
Overall, it’s been a successful decade of progress and improved reliability without a rate increase. We will do our best to minimize the impact of inflation on your electric bill, and we will keep you informed.
Not in business to profit
On a brighter note, when power costs are favorable, Polk-Burnett will continue to pass a PCA credit to members. And as a cooperative, we will continue to retire Capital Credits annually. In April 2022, the board approved a special Capital Credit distribution of $1 million, followed by our regular Capital Credits of $2.28 million in November. Watch for 2023 Capital Credits next fall.
I’m also proud to say that Polk-Burnett gives back to our community in ways that do not impact your electric rates. In 2022, Operation Round Up achieved a milestone of $1,000,000 in giving since its beginning in 1998, thanks to the generosity of members who round up! Grants are awarded quarterly to nonprofits that improve our local quality of life.
Polk-Burnett also awarded $77,500 in scholarships to the Class of 2022, with 62 students each receiving $1,250 to continue their education. Co-op scholarships are given to sons and daughters of co-op members, and are funded with unclaimed Capital Credits.
Electricity is a value we depend on
There is never a good time to share the news that electricity rates are rising, but it's important to be open and honest, so members know what to expect. Our mission for the past 85 years has been to deliver safe, reliable electricity to power your lives. We will continue to keep you informed, and deliver extraordinary service and value for your dollar.
Please call us at 800-421-0283, or visit our office or website to learn about coop programs that can help you save energy and money this New Year, including billing options, EnergySense rebates and SmartHub to track and manage your energy use.
