Manager’s Message — May 2019
The electric utility industry in California is rapidly changing due to legislation and wildfire impacts. Given the last two horrific fire years, the California Legislature and the California Public Utilities Commission have been busy adding additional requirements for all electric utilities in California. Sometimes, and for some utilities, these regulations make great sense. In other cases, they add significant costs with marginal benefits, especially to utilities that have been working hard to maintain and operate a safe electrical grid.
Your board of directors and management team strives to operate the cooperative in the most efficient, cost-effective manner possible, but the costs to operate the cooperative are increasing due to these changes in regulatory requirements and continued tree mortality. As a result, the board is considering a mid-year rate increase..
It has been five years since the last increase of 3.7 percent. The wet winter this year has allowed us to delay the proposed increase to the middle of 2019. However, we will not be able to count on another wet winter, and we must plan for normal years. In addition, even though we have received the benefit of increased hydropower this year, other power costs have increased, offsetting our wet-year savings. Members have indicated to us at past rate meetings they would prefer to see multiple smaller increases rather than one large cost increase.
We will host meetings May 7 and 8 to discuss the proposed rate increase and Plumas-Sierra Rural Electric Cooperative’s Wildfire Mitigation Plan. The meeting on Tuesday, May 7, is at 6 p.m. at the Milford Community Center. The meeting on Wednesday, May 8, is at 6 p.m. at the PSREC headquarters in Portola. We encourage you to attend one of these member-only meetings if you would like to learn more and provide input on PSREC’s Wildfire Mitigation Plan and the proposed rate increase.
At this time, the proposed rate increase would affect only the facilities charge and would be implemented in two parts. The first increase, if approved, would take effect July 1 and be an additional $4.32 for residential members. The second increase, if approved, would take effect January 1, 2020, and be an additional $2.67 for residential members.
As much as possible, we try to operate on a cost-of-service basis, meaning each member pays the costs associated with providing service to their property, and each rate class should have roughly the same rate of return. Our cooperative’s costs do not change much with use. Up to 70 percent of our costs are fixed, including the cost of operating the utility and the fixed portion of our power plants. We are collecting only a portion of our fixed costs through facilities charges. We also try to get the cost of service as close as possible to actual costs when looking at all electric homes versus homes that use primarily propane, or seasonal versus full-time residents. For these reasons, the proposed rate increase will be to the facilities charge so we can collect more of our fixed costs through the fixed fees.
We will have more information on residential, small commercial and irrigation rates at the meetings. Please join us May 7 or May 8 to learn more and provide your input.
This year, Districts 2 and 5 are up for election. District 2 (Graeagle-Mohawk areas) is served by Dick Short. District 5 (Lake Davis-Long Valley-Washoe County areas) is served by David Hansen. The boundaries of each district are on the PSREC website if you would like to check on which one you live in.
See page 28 of this month’s Ruralite for qualifications and nomination information for the board of directors.
Please call me for more information if you live in one of these districts and are interested in running for the board. The board meets once a month, usually the fourth Wednesday. Directors must attend significant training to stay current on issues and become certificated as a director.
Look Up and Live
As irrigation season approaches, it is a great time to remind members to look up and live. Whether cutting trees, working with irrigation pipe or moving any long objects, make sure you look up for power lines.
We continue to upgrade our broadband network across the region. If you have not contacted us to be put on the interest list, call us today at 800-221-3474, or visit our website at www.pst.coop. We are upgrading the system in sections and will contact those on our interest lists first to offer services.
With plans offering download speeds of 20Mbps or more, depending on location, multiple-device households finally can stop fighting over bandwidth.
To sign up, give us a call at 800-221-3474 or visit our website at www.pst.coop. If you have any questions, please contact me at 800-555-2207 ext. 6076, or email me at email@example.com.