Dear Member:
If you have been listening to the news lately, other than healthcare, you have no doubt heard a great deal regarding energy. The subjects of green house gas emissions and climate change are most often what you hear discussed. These issues, while sometimes debated, prompted new regulation by the federal government limiting certain forms of electricity generation. On January 1, 2009, the impact to your cooperative was a 60% increase in the price of power purchased on your behalf. The cooperative expects another 4% increase January 1, 2010.
In anticipation of new regulation, McDonough Power, over the last several years, did the following in effort to minimize the impact to members.
- We deferred revenue when possible in order to offset this increase.
- We lowered labor costs by trimming the number of employees and consolidating duties.
- We utilized new technology in order to create internal efficiencies and cost containment.
- We recently refinanced large portions of our debt, which lowered expense.
As a result of these and other proactive measures, your cooperative is limiting the members' rate increase to an average of 2.6%. The increase will be accomplished by raising the facility charge $2.00 and modifying the energy charge slightly. Furthermore, the cooperative is eliminating the declining rate structure, which modestly discounted the price per kilowatt-hour for electricity purchased in larger amounts. The new rate will take effect January 1, 2010.
We appreciate the trust and support you give us. Your cooperative and your Board of Directors are closely monitoring the issues that affect rates. We are concerned; however, rest assured that we will waste no opportunity to protect your interests and to advocate on your behalf. We plan to update you in our newsletter as more information becomes available. Please call or visit us at the cooperative if you have any questions.