UNION RURAL ELECTRIC COOPERATIVE LOCAL CONNECTIONS MESSAGE FROM THE CEO/PRESIDENT
NO RATE CHANGE MARKS SEVENTH YEAR WITH NO DISTRIBUTION INCREASE !
Every spring, our generation provider, Buckeye Power, reviews its generation revenue requirements and adjusts the wholesale rates that it charges distribution cooperatives like URE. We then review the new rates and determine if adjustments are needed to the retail rates charged to our consumer-members. Our goal is to always pass-through incurred costs for energy to our members in a fair and deliberate manner.
URE has determined that the increase to the wholesale Buckeye Anthony Smith demand charge CEO/PRESIDENT and the decrease to the energy charge essentially offset each other and the current retail rates are appropriate to recover all Buckeye generation costs.
There are four elements to Buckeye’s wholesale rates: fuel, PJM demand, Buckeye demand, and energy. The most significant of these is the fuel charge, which is based on the cost of coal, natural gas, and other resources needed to turn the turbines to generate electricity. This is a variable rate charged to kilowatt-hour usage and changes every month. It is also a variable rate on the URE bill to our consumer-members.
There will also be no change in URE’s approach to billing transmission and distribution services. Transmission rates change every month and are designed to collect the wholesale transmission costs without markup. And, for the seventh consecutive year, there will be no increase to retail distribution rates. Distribution charges fund the operations of URE, your local electric provider.
The other three elements are reviewed and adjusted once a year. Buckeye Power is a member of the Pennsylvania, Jersey, Maryland (PJM) regional transmission organization (RTO) that interconnects the power grid over a large portion of the eastern United States. The demand charge rate associated with PJM is not changing. The Buckeye demand charge covers fixed costs such as depreciation and property taxes on the generation plants and is increasing July 1. Finally, the energy charge is based on kilowatt-hour usage and covers Buckeye’s variable costs, such as maintenance on the generation plants and administration. The energy rate per kilowatt-hour is decreasing July 1. While the Fuel Cost portion of the bill you receive every month will continue to vary based on the rate charged to URE, the generation rate on your residential or commercial bill will not change over the coming year.
The natural gas rates will also remain unchanged. Gas commodity rates (the cost of gas and capacity we must purchase to deliver to our members) will continue to be passed through to all members based on actual cost, and there are no changes to the distribution or service charges. As a not-for-profit cooperative, our goal is to bill our membership only for what we are billed for electric and natural gas costs plus the cost of operating the distribution systems along with reasonable margins. Eventually, our consumer-members benefit from the return of margins gained in the form of capital credits retirements, or billing credits. Our member services team is happy to discuss rates or the steps you can take to reduce your costs. Call 937-6421826 or visit us at www.ure.com.
JULY 2021 • OHIO COOPERATIVE LIVING 19
