District Meeting Recap
Thank you to everyone who came to our first annual District Meetings. Hopefully, this will be an annual event that we will hold in March or April each year going forward. For those who were unable to attend this year's event, I wanted to outline some of the main information that was shared.
Over the past year, we have been working with our engineering team to develop a long-term infrastructure replacement plan. This allows us to look 20 years into the future and identify what parts of our system we will need to be upgraded due to age and reliability.
In recent years, we have been updating our system by replacing aging overhead lines with underground. On average, we have been doing approximately 4 to 5 miles of line per year. According to our long-range plan, we will need to double the number of system replacements we have been making to ensure that our system remains reliable as portions of the system are reaching the end of their useful 60-year life.
While we are accelerating the amount of infrastructure that we replace, our costs for providing services are also increasing. Our wholesale power rates have been increasing over the past few years, with an additional increase anticipate for 2026. Further, the cost of materials and equipment has risen by more than 100% for many components over the past few years. We continue to anticipate a tight market for supplies and equipment as the annual global demand continues outpacing the available supply.
However, with all the negative news, there are some positives as well. First, we have seen consistent membership growth and have new larger loads, load expansions and housing developments in the works. This additional load helps spread costs and are an overall positive for the whole membership.
Our crew has been working on changing load control receivers to water heaters, grain bins and irrigation systems. This program was started in the 1980’s and the equipment associated with this system has also reached the end of life. This is an important component of our system and saves the Co-op approximately $250,000 per year in our wholesale power costs. To continue reaping the benefits of these savings, we need to make upgrades and modernize this system. This is a multi-year project as we have approximately 1,500 load control receivers on our system.
FEMA has finalized the damage that we incurred in the 2024 Big Sioux Flood. In total, we had nearly $365,000 in equipment damage. This was mostly due to metering equipment, sockets and transformers. Crews are in the process of making final repairs on the damaged equipment and we hope to have this project closed by July 1st, over 1 year after the flood occurred.
While there is a lot happening in the energy industry, we continue to focus on the things that we can control. We strive to operate efficiently, continue looking for grant funds to reduce our infrastructure investment costs and explore partnerships that are beneficial for our membership.
Until next month, stay safe and God bless.