Manager’s Message – June 2022

The science behind electric rates

As a member-owned cooperative, United Electric Co-op Inc. electric rates are designed to recover the costs to serve the organization’s collective membership with safe, reliable and affordable power. From time to time, United Electric must examine its rate structure and adjust as necessary to ensure fair cost recovery for all rate classes.

A recently concluded cost-of-service assessment has provided a comprehensive review of United Electric’s customer classes and rate mechanisms related to the cooperative. The purpose of a cost-of-service analysis is to determine the amount of annual revenue necessary to operate the utility efficiently and meet the financial obligations of United Electric.

This assessment, conducted by an independent expert consulting firm, determined United Electric should adjust the rate mechanisms designed to recover the utility’s fixed costs and expenses associated with the cost of energy. The rate adjustments applicable to most customer classes include a decrease to the energy rate and a modest increase to the base customer charge.

Because the energy charge decrease is coupled with a customer charge increase for most members, it is expected that, on average, UEC members will see no change to the total amount of charges on their bills based on these rate adjustments. For example, a residential customer who uses approximately 1,650 kilowatt-hours of electricity during a month will not notice any changes to their total monthly bill.

These rate adjustments—effective July 1, 2022—will ensure UEC continues to operate in a financially stable manner and continues to meet its obligation to serve members with cost-effective, safe and reliable electric service. UEC’s complete rate schedule and contact information are available on our website.

Thank you for your ongoing support and membership at UEC. Feel free to contact the cooperative any time if you have questions or concerns about your electric service.

Michael Darrington