H T WATTS
More About Upcoming Rate Adjustment
By General Manager Juli Orme
If you are like me, I’m not always a fan of “change.” The reality is that change is occurring all around us. We all have seen it, felt it, experienced it. At times, change is good. And at other times, it isn’t. At CHEC, we have experienced significant changes over the last several years. Resiliency and adaptability are necessary to survive some of the changes. For instance, changes in laws and regulations have significantly impacted our industry, from how we operate to the amount of resources we have available to operate. Also, insurance companies have placed impactful requirements on utility companies just to maintain or obtain coverage. Some of the changes are direct, while others are indirect. Regardless, compliance comes with a cost. For instance, over the last several years, the electric utility industry has been pressured to switch to renewable energies as our primary generation source. Even though AECI, our wholesale power provider, spoke up early to let Congress know the impact would drive up electric rates while reducing reliability, it took years to get the attention of our national leaders. Although
steps have been put in place to reverse this trend, unfortunately, many electric utility companies have had to move forward with a compliance plan, which means replacing coal and gas generation with more expensive options. This process takes years to complete and is incredibly expensive. Also, as more appliances and equipment have transitioned from gas to electric, along with the addition of energy-consuming data centers, the demand for electricity has increased dramatically. This has triggered the need for additional power plants, which again come at a very significant cost. The last five years have resulted in the perfect storm of events – inflation, higher cost of debt, shuddering low-cost power plants, energizing more appliances and equipment, and adding data centers, all while replacing power plants with higher-cost generation. This impacts ALL of us, and the end result is increasing costs across the board.
As I announced in October at our Annual Meeting, a rate adjustment was imminent due to
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Headquarters Office
PO Box 539 • 1002 E. Main
Stigler, OK 74462 • 800-328-2368
Branch Office
PO Box 587 • 1800 KOA/Power Drive
Sallisaw, OK 74955 • 918-775-2211
Pay-by-Phone: 1-888-678-1937 www.cooksonhills.com
Alternate Emergency Only: 918-552-0016
BOARD OF TRUSTEES
Joe Ogle, President District 6
John Dillard, Vice President District 3
Ronnie Pevehouse, Sec/Treasurer District 7
Tim Jones District 1
Dan Callahan, Trustee District 2
Dart Drummonds, Trustee District 4
Mike Rose, Trustee District 5
STAFF
Juli Orme, General Manager
Marty Huff, Director of Safety & Loss Control/ROW Coordinator
Ellen Mattison, Manager of Accounting Services
Kristie Cash, Manager of Office Services
Jeremy Stubblefield, Chief Technology Officer
Brad Martin, Director of Member/Public Relations and Economic Development
Dallin Shaw, Director of Engineering
Kellan Lujan, Manager of Subsidiary Accounting
Austin Poindexter, Director of Operations
Russell V. Barber, General Counsel
Cookson Hills Electric Cooperative, Inc. welcomes members to submit photos, and articles which will be subject to editing. Cookson Hills reserves the right to publish or modify any article. Companies and individuals featured in the Hot Watts newsletter do not necessarily reflect the official policy, position, or view of Cookson Hills.
Cookson Hills Electric Cooperative, Inc. is an equal opportunity provider and employer.
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bit.ly/CHEConFB (case-sensitive)
Rate information, continued
increased wholesale power costs as well as increased operating and compliance costs related to extreme inflationary pressures. CHEC’s last full rate increase occurred in 2014, along with an increase in the monthly service availability charge in 2018. Over the last four to five years, equipment and materials have almost doubled in cost, along with many other areas of cost increases, placing significant pressure on our existing rates. CHEC contracted with an independent third-party rate expert to perform a cost-ofservice study and to guide the rate-making decision process. The cost-of-service study was prepared in accordance with regulatory standards and provided CHEC with recommendations that meet regulatory and debt covenant requirements. The results of the study were presented in late December 2024 to management and the Board of Trustees for review. After much consideration, the Board approved a rate plan that results in an overall average increase of just over 7% that will become effective April 1, 2025.
Although we would like to say that the power cost adjustment (PCA) you see on your bill will go away, it will not because the PCA is related to wholesale power costs. Within the cost-of-service study, the average wholesale power cost on a per kilowatt-hour basis is estimated based on historical and estimated future costs. Each month, our wholesale power costs fluctuate due to the amount of purchases we make. We calculate our wholesale power costs for the current month on a per kilowatt-hour basis. This is compared to the average cost in the cost-of-service study. The difference is the power cost adjustment (PCA). We anticipate a decrease in the
PCA in April since much of the cost will shift to the rate base as a result of the new cost-of-service study. Unfortunately, this number will not be known until the beginning of April.
To help you better understand your rates, we have inserted a copy of our new rate schedule on page 4. The monthly service availability charge will increase for each revenue class, with residential members noticing an increase from $35 to $40 per month, in addition to an increase in the energy charge, which is a per kilowatt-hour charge. For example, a residential service that uses 1,000 kWh during a winter month will see an increase of approximately $14 for one month, while during the summer months, you will see an increase of approximately $13 for one month. A member that uses 2,000 kWh during a winter month will see an increase of approximately $27.50 per month and an increase of approximately $21.50 per month during the summer. The PCA is calculated separately and is not considered for these calculations as that number is not known and is recalculated on a monthly basis.
Delivering difficult information is not my favorite task, but we believe keeping you informed is essential as you make financial decisions for your families and businesses. We thank you for allowing us to serve you, and we appreciate your understanding during what we realize is a difficult time for many. As always, we will continue to work hard to control costs without compromising reliability. You are always welcome to reach out to us with questions.
Sincerely, Juli
SmartHub is your chance to Win a Gift Card!
For the month of March, we are excited to offer a chance for our members to win a gift card! Cookson Hills offers a free, online mobile app to add convenience and enhance the experience of our members. The SmartHub mobile app makes it easy to report a power outage, make a payment, check your electric usage, and so much more. With SmartHub, you have access to manage your electric account 24/7 from your smartphone, computer, or tablet! So, what do you have to do to win a gift card? It’s
SIGN UP TO WIN!
Sign up for the SmartHub Mobile App between March 1st - March 31st and you’ll be entered into a drawing for a $50 gift card!
Existing SmartHub users will be entered to win a $25 gift card!
Scan the code or visit www.cooksonhills.com/smarthub to get started!
simple! Any member who signs up for SmartHub between Saturday, March 1st through Monday, March 31st will be entered for a drawing to win a $50 gift card. Already using SmartHub? That’s great! You’ll be automatically entered into a drawing for a chance to win a $25 gift card. 3641600 To download the app, search for “SmartHub” in the Apple App Store or Google Play Store. You can also access SmartHub by scanning the provided QR code, or by visiting www. cooksonhills.com/ smarthub. If you have any questions, please call us at 800-328-2368 and we will be happy to assist you!
Do You Qualify for a Rebate?
Since 2010, Cookson Hills Electric has been proud to offer a variety of rebates for our members. The “Take Control and Save” program is administered through Associated Electric Cooperative, whom we purchase our wholesale power from. The program is designed to help you save money when installing new equipment in your home, as well as increase energy efficiency.
Qualifying appliances and equipment are as follows:
• Energy Star Window Air Conditioning
• Electric Water Heater
• Energy Star Advanced Programmable Thermostat
• Mini-Split
• Dual-Fuel Heat Pump
• Ground Source Heat Pump
• Air Source Heat Pump
To see a complete list of requirements and access the application, please visit our website at www. cooksonhills.com/rebates, or stop by either office to pick up a hard copy. Your product must meet all the qualifications listed on the application to be eligible to receive the rebate. If you have any questions or concerns, please call 800-328-2368 and we will be happy to assist you.
