SECO Energy 2019 Annual Report - The Vision

201 9 201 ANNUAL REPORT 9 ANNUAL REPORT

2

SECO Energy SECO Energy 20192Annual2019 Report Annual Report

3 4 6 7 8 9 10 11 12 13 14 15 JIM DUNCAN JIM DUNCAN CEO

CEO

LETTER TO MEMBERS

Dear Members, SECO Energy’s mission is to construct, maintain and restore the electric system when outages occur. We construct new facilities to meet the growing demand for affordable, safe, reliable power in our 2,100-square mile territory. Our system is upgraded and rigorously maintained to prevent outages. When an outage occurs, crews quickly respond to restore service safely.

Storm hardening our electric system is also a top priority. We aggressively replace aging poles that have the potential to fail and cause outages. Our annual tree trimming budget has increased from $9 million in 2017 to almost $18 million projected in 2020 to target trees growing too close to power lines that are likely to cause outages.

In 2019, SECO added 6,189 new services. Our member count at 2019 year-end was 210,815 members. Growth of this caliber is almost unheard of among electric cooperatives as the median size co-op nationally is just 13,000. SECO is the third-largest cooperative in Florida and the seventh-largest cooperative in the nation.

SECO Energy’s 400+ world-class employees excel in member satisfaction. In 2019, our American Customer Satisfaction Index (ACSI) score came in at 90. This is a one-point increase from our 2018 score, and makes SECO a customer satisfaction leader.

Growth brings its own unique challenges. The cost of everything associated with operating, constructing and maintaining a state-ofthe-art electric system is rising. We are building new substations, adding power transformers at existing substations, upgrading voltage and conductor and converting critical overhead facilities to underground.

Our 2020 construction work plan tops $55 million and is configured to preserve the balance between reliability and affordability. The work plan includes building new communication towers, upgrading our radio system and installing fiber-optic cable and microwave backhaul for automated communications that facilitate faster and safer outage restoration.

Thank you for your membership and the trust you place in SECO as your local not-for-profit electric cooperative.

Sincerely,

Jim Duncan Chief Executive Officer

Jerry Hatfield

President, Board of Trustees

SECO Energy 2019 Annual Report

1

24

NEW SUBSTATION NEW SUBSTATION NEW SUBSTATION

EXISTING SUBSTATION UPGRADE EXISTINGEXISTING SUBSTATION SUBSTATION UPGRADE UPGRADE

24

98

NEW FIBER NEW FIBER NEW FIBER

NEW COMMUNICATIONS TOWER NEW COMMUNICATIONS NEW COMMUNICATIONS TOWER TOWER

POLE REPLACEMENTS POLE REPLACEMENTS POLE REPLACEMENTS

TREE TRIMMING/REMOVALS TREE TRIMMING/REMOVALS TREE TRIMMING/REMOVALS

THREE-PHASE CONVERSION THREE-PHASE THREE-PHASE CONVERSION CONVERSION

25 KV CONVERSION 25 KV CONVERSION 25 KV CONVERSION

UNDERGROUND CONVERSION/UPGRADES UNDERGROUND UNDERGROUND CONVERSION/UPGRADES CONVERSION/UPGRADES

FIBER FIBER FIBER

201 9 ANNUAL REPORT MICROWAVE BACKHAUL MICROWAVE MICROWAVE BACKHAUL BACKHAUL

SECO ENERGY SERVICE TERRITORY SECO ENERGY SECO ENERGY SERVICE SERVICE TERRITORY TERRITORY

H

2

SECO Energy 2019 Annual Report

27A

4 500

Morriston Blitchton 121 Morriston Morriston

LEVY 98 EVY LEVY 121

25

500 Blitchton Blitchton

121

25

27

75 75

Rainbow Park

55 55

Rainbow ParkRainbow Park

Martel

Martel Martel

75 492

301 301

Inglis

27

27

Dunnellon Dunnellon Dunnellon

Inglis

11 11

40

19

441

Crystal River Crystal River Crystal River

75

Homosassa HomosassaSprings Homosassa Springs Springs

Rutland Inverness Inverness Inverness

Floral City

Villages

Lake Villages

700

19 19

700

19

HERNANDO HERNANDO HERNANDO Brooksville Brooksville

50 50

50

Brooksville 50 50

Spring Spring HillSpring Hill Hill 19

Hudson n Hudson

19

Altoona

Umatilla

Umatilla Umatilla

LAKE Fruitland LAKE LAKE Fruitland ParkFruitland Eustis

91

93 27 27

Lake Apopka Lake Apopka Apopka

Ocoee Winter OcoeeWinter Ocoee Garden Garden

33

75 PASCO 75 PASCOPASCO

Dade City Dade City Dade City 75

33

429

Orlando 408 Orlando Orlando 408

408 417 417 528 528

400

4

4 192 192

528

17 17

4

Oviedo Oviedo

423

400

CEO

192

Oviedo

423

JIM DUNCAN

Four Four Corners Four Corners Corners

4 SEMINOLE SEMINOLE SEMINOLE

423

400

33

Sanford Sanford

ORANGE ORANGE ORANGE 417

27 25

4

4 4

Apopka 436 Altamonte Apopka 436 Altamonte 436 Altamonte Springs Springs Springs Lake

25 25

Sanford

Apopka

429 429

4

Deltona Deltona Deltona

Lake

50 93 93

DeLand DeLand 4

Paisley Paisley

Altoona Paisley Altoona

FL Bushnell Bushnell Tu rnFpL FL Ferndale ikTeu Tu Webster 75 rnp rnp Ferndale Ferndale i i k k Webster Webster e e 75 Mascotte Minneola Mascotte 50 Mascotte Minneola Minneola 50 50 Tarrytown Winter Groveland Clermont 50 Tarrytown Tarrytown Groveland Garden Groveland Clermont Clermont 50 50

75

700

DeLand

Wildwood FL Tur Wildwood Wildwood nFpLi LT Park Park Eustis Eustis kTeur urn 441 npi pik ke e 441 441 Leesburg Sorrento Tavares Coleman Adamsville Leesburg Leesburg Sorrento Tavares Tavares Sorrento Coleman Coleman Adamsville Adamsville Lake 500 Okahumpka Lake Panasoffkee Lake Sumterville 500 500 Okahumpka Okahumpka Yalaha Panasoffkee Panasoffkee Zellwood Sumterville Sumterville Howey-inYalaha Yalaha 27 Zellwood AstatulaZellwood Howey-in- the-Hills Howey-in27 27 91 the-Hills Astatula the-Hills Astatula

Rutland Rutland F

Floral City Floral City

Lady Oxford The LadyThe Lake Lady Oxford Oxford 75 The Villages

SUMTER 91 SUMTER SUMTER Bushnell

19

VOLUSIA VOLUSIA VOLUSIA

27

75

CITRUS CITRUS CITRUS

40

Ocklawaha Belleview Ocklawaha Ocklawaha Belleview Belleview

19

9

40 40

Marion Summerfield Marion Oaks Marion Oaks OaksSummerfield Summerfield Weirsdale Linadale Weirsdale Weirsdale Linadale Linadale

19

11

40 40

301 441 441

95

95

492

Ocala 492 Ocala Ocala

55

1 1

SYSTEM IMPROVEMENT MAP SYSTEM SYSTEM IMPROVEMENT IMPROVEMENT MAP MAP

MARION MARION MARION

27 27

FLAGLER FLAGLER FLAGLER

Salt Springs Salt Salt Springs Springs

25

500

8

is

PUTNAM PUTNAM PUTNAM

27A Williston Williston Williston

17

SECO Energy 3 2019 AnnualSECO Report SECO Energy 3 Energy 2019 Annual Report 2019 Annual Report

3

9

OUR YEAR BY THE NUMBERS

M E M B E RS

3.47

90 2 01 9 AC S I SCO R E

31.77% ME M B ER EQ UITY

TIER 2.07

B IL L I ON KWH S OL D

3rd

LARG E ST CO -O P IN FLO RIDA

7th

LARGEST IN THE

NATION

4

SECO Energy 2019 Annual Report

TOTAL PLANT INVESTMENT

$917.8 MILLION

90 75

73

73

SECO ENERGY

INVESTOR-OWNED

MUNICIPALS

OTHER CO-OPS

In 2019, members rated SECO Energy a customer satisfaction leader. Our 2019 ACSI score is an impressive 90. This is a one-point increase over our 2018 score.

Our score of 90 is tops when compared to average ACSI scores in the energy industry.

Nationally, cooperative utilities averaged 75 in 2019, which is two points lower than the 2018 score. Investor-owned utilities and municipal utilities scores averaged 73, both of which are two points lower than the 2018 score.

Thank you, members, for your recognition of our employees’ efforts.

SECO Energy 2019 Annual Report

5

SECO Energy’s Board of Trustees are members who live in SECO’s service territory. They are elected to oversee the governance of the cooperative.

Each Trustee on the Board is elected by the members who reside in his/her District. Collectively, the Trustees are responsible for establishing, reviewing and revising corporate policies to ensure that SECO continues to preserve reliable, affordable service for all members.

6

SECO Energy 2019 Annual Report

JERRY D. HATFIELD District 9 President

RICHARD DENNISON District 4 Vice President

BILL JAMES District 8 Secretary-Treasurer

SCOTT D. BOYATT District 1

DILLARD B. BOYATT District 2

GERALD B. ANDERSON District 3

RAY F. VICK District 5

EARL MUFFETT District 6

JOSEPH E. KUSIAK District 7

27

LEVY

DISTRICT MAP

41

40

Ocala

200

75

Lake Weir 19

MARION CITRUS

Umatilla

301

44

41

District 1 S. Boyatt District 2 D. Boyatt District 3 Anderson District 4 Dennison District 5 Vick District 6 Muffett District 7 Kusiak District 8 James District 9 Hatfield

Wildwood

Lake Griffin

Lake Eustis

441

Leesburg

Lake Panasoffkee

44

Lake Harris

48

Lake Apopka 301

50

HERNANDO

Clermont

471

LAKE PASCO

SUMTER

33

27

SECO Energy 2019 Annual Report

7

EXECUTIVE

OUR PURPOSE

LEADERSHIP

To provide exceptional service to our members, co-workers and communities.

JIM DUNCAN

Chief Executive Officer

OUR VALUES Member Commitment Honesty and Integrity Safety Strong Work Ethic Teamwork Open Communication

BEN BRICKHOUSE VP of Engineering

GENE KANIKOVSKY Chief Financial Officer

8

SECO Energy 2019 Annual Report

NORA BROWN

Sr. Executive Assistant

JOHN LASELVA VP of Operations

KATHRYN GLORIA VP of Corporate Communications

GREGG MORRELL

VP of Corporate Services & Human Resources

INDEPENDENT AUDITOR’S REPORT

Board of Directors Sumter Electric Cooperative, Inc. Sumterville, Florida Report on the Financial Statements We have audited the accompanying financial statements of Sumter Electric Cooperative, Inc. (the Cooperative), which comprise the balance sheets as of December 31, 2019 and 2018, and the related statements of revenues and patronage capital, and cash flows for the years then ended, and the related notes to the financial statements.

Management’s Responsibility for the Financial Statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with auditing standards generally accepted in the United States of America and the standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Cooperative, as of December 31, 2019 and 2018, and the results of its operations and its cash flows for the years then ended in accordance with accounting principles generally accepted in the United States.

Other Matters Supplementary Information Our audit was conducted for the purpose of forming opinions on the financial statements of the Cooperative’s basic financial statements. The Schedule of Expenditures of Federal Awards is presented for the purposes of additional analysis as required by Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principals, and Audit Requirements for Federal Awards (Uniform Guidance), and is not a required part of the basic financial statements.

The Schedule of Expenditures of Federal Awards is the responsibility of management and was derived from, and related directly to, the underlying accounting and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the United States of America. In our opinion, the accompanying Schedule of Expenditures of Federal Awards is fairly stated, in all material respects, in relation to the basic financial statements as a whole.

Other Reporting Required by Government Auditing Standards In accordance with Government Auditing Standards, we have also issued our report dated February 11, 2020, on our consideration of the Cooperative’s internal control over financial reporting and our tests of its compliance with certain provisions of laws, regulations, contracts and grant agreements, and other matters. The purpose of that report is to describe the scope of our testing of internal control over financial reporting and compliance and the results of that testing, and not to provide an opinion on the internal control over financial reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards in considering the Cooperative’s internal control over financial reporting and compliance.

Other Reporting Required by 7 CFR Part 1773 In accordance with 7 CFR Part 1773, Policy on Audits of Rural Utilities Service Borrowers, §1773.33, we have also issued our report dated February 11, 2020, on our consideration of the Cooperative’s compliance with the terms, covenants, provisions, or conditions of their loan, grant, and security instruments as set forth in the regulatory requirements for electric borrowers, insofar as they relate to accounting matters enumerated therein.

The purpose of that report is to describe the scope of our testing of the Cooperative’s compliance with the regulatory requirements for electric borrowers and the results of that testing, and not to provide an opinion on the Cooperative’s compliance with the regulatory requirements for electric borrowers. That report is an integral part of an audit in considering the Cooperative’s internal control over financial reporting and compliance.

February 11, 2020 Ocala, Florida Certified Public Accountants Laurel Ridge Professional Center . 2347 S.E. 17th Street . Ocala, Florida 34471 . (352) 732-3872 MEMBERS OF AMERICAN AND FLORIDA INSTITUTES OF CERTIFIED PUBLIC ACCOUNTANTS MEMBER OF AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS PRIVATE COMPANIES AND S.E.C. PRACTIVE SECTIONS

SECO Energy 2019 Annual Report

9

BALANCE SHEETS | DECEMBER 31, 2019 AND 2018 ASSETS

2019

2018

Electric Plant Distribution, Transmission, and General Plant

Memberships

$

878,746,560

Total Electric Plant (Accumulated Provision for Depreciation and Amortization)

$

828,151,643

39,070,154

50,519,318

917,816,714

878,670,961

(204,325,724)

(198,127,664)

713,490,990

680,543,297

Investments Investments in Associated Organizations and Other Special Funds

$

Patronage Capital

937,010

272,268,172

2018 $

911,525

257,504,864

Accumulated Other Comprehensive Income

(692,156)

(519,288)

Other Equities

5,860,121

5,216,724

278,373,147

263,113,825

498,141,631

475,610,909

Capital Lease Obligation

3,678,601

2,806,272

Deferred Compensation Liability

2,132,463

1,555,821

503,952,695

479,973,002

19,989,058

17,333,663

Capital Lease Obligation - Portion Due Within One Year

1,467,007

1,032,088

Line of Credit

1,186,132

Total Equities

Long-Term Debt

Total Non-Current Liabilities 97,272,555

89,955,325

Current Liabilities Long-Term Debt - Portion Due Within One Year

Current Assets Cash and Cash Equivalents

2,027,502

2,468,372

Accounts Receivable - Consumers (Less Provision for Doubtful Accounts 2019 - $922,007, and 2018 - $1,293,251)

11,225,269

10,808,496

Accounts Payable

Other Receivables

17,892,879

20,912,606

Consumer Deposits

Unbilled Electric Revenues

13,474,363

9,937,438

Inventories

15,882,376

17,107,723

Prepayments and Other Current Assets

379,200

Total Current Assets Deferred Charges

SECO Energy 2019 Annual Report

2019

Non-Current Liabilities

Total Electric Plant - Cost Less Depreciation and Amortization

Total Assets

Equities

Construction Work in Progress

10

EQUITIES AND LIABILITIES

60,881,589 4,564,778 $

876,209,912 $

164,667 61,399,302 6,261,486 838,159,410

Other Current or Accrued Liabilities

Total Current Liabilities Deferred Credits Total Equities and Liabilities

$

-

19,548,807

34,821,115

17,819,162

17,395,843

18,749,902

11,629,114

78,760,068

82,211,823

15,124,002

12,860,760

876,209,912 $

838,159,410

STATEMENTS OF REVENUES AND PATRONAGE CAPITAL | DECEMBER 31, 2019 AND 2018

Operating Revenues

$

2019

395,780,230 $

2018 392,699,934

Transmission Expense

255,458,625

265,587,987

276,306

228,289

5,100,000

1,618,740

1,793,800

Total Other Margins

7,534,997

6,893,800

13,666,197

13,582,069

1,241,461

899,223

Other Non-Operating (Expense) Income 1,998,723

271,937

18,352,708

Net Operating Margins

Distribution Expense - Maintenance

37,394,763

29,836,108

Non-Operating Margins

Consumer Accounts Expense

12,629,391

12,274,676

Customer Service and Informational Expense

2,172,608

2,185,419

Administrative, General, and Other Expense

18,049,692

16,522,505

Depreciation Expense

27,120,911

25,487,271

Other Expense

(Total Operating Expenses) Operating Margins Before Fixed Charges

71,835

553,303

307,823

(373,068,304)

(370,854,621)

22,711,926

21,845,313

(16,580,726)

(15,157,044)

6,131,200

6,688,269

$

Other Capital Credits and Margins

19,334,959

77,746

2018

5,916,257 $

Distribution Expense - Operations

Taxes - Expense

2019

Other Margins G&T Cooperative Capital Credits

Operating Expenses Cost of Power

Interest Income

Total Non-Operating Margins Net Margins Patronage Capital, Beginning of Year

Reallocation of Unclaimed Patronage Capital (Retirement of Capital Credits) Patronage Capital, End of Year

$

3,240,184

1,171,160

16,906,381

14,753,229

257,504,864

248,116,609

1,345,150

-

(3,488,223)

(5,364,974)

272,268,172 $

257,504,864

Fixed Charges Interest on Long-Term and Short-Term Debt

Operating Margins After Fixed Charges

SECO Energy 2019 Annual Report

11

STATEMENTS OF COMPREHENSIVE INCOME DECEMBER 31, 2019 AND 2018

2019 2018

Net Margins

$

16,906,381

$

14,753,229

Other Comprehensive Net Margins

STATEMENTS OF CASH FLOWS DECEMBER 31, 2019 AND 2018 2019 2018

Cash Flows from Operating Activities Net Margins

$

$

14,753,229

Adjustments to Reconcile Net Margins to Net Cash Provided by (Used in) Operations:

Amortization of Unrecognized Prior Service Costs and Unrecognized Actuarial (Loss) Gain

(172,868)

125,411

Capital Credits and Patronage Dividend Certificates Assigned Depreciation

Comprehensive Net Margins

16,906,381

$

16,733,513

$

14,878,640

Provision for Uncollectible Accounts Amortization of Prepaid Pension

(7,534,997)

(6,893,800)

28,341,424

26,722,224

363,057 1,148,029

227,150 1,148,029

Changes in Assets - Decrease (Increase) and Liabilities - Increase (Decrease):

STATEMENTS OF CHANGES IN COMPREHENSIVE INCOME DECEMBER 31, 2019 AND 2018

2019 2018

Accumulated Other Comprehensive Income (Loss)–Beginning of the Year $

(519,288)

$(644,699)

Accounts Receivable

(4,316,755)

(4,589,861)

Other Receivables

3,019,727

(2,199,650)

Prepayments and Other Current Assets

(214,533)

Deferred Charges

548,679

(55,787)

Accounts Payable

(15,272,308)

2,647,181

423,319

928,669

7,120,788

(3,475,567)

576,642

9,748

2,263,242

161,668

Total Adjustments

16,466,314

14,603,278

Net Cash Provided by (Used in) Operating Activities

33,372,695

29,356,507

1,225,347

(1,354,257)

12,905,920 4,887,038

13,216,548 405,570

Consumer Deposits Amortization of Unrecognized Prior Service Costs and Unrecognized Actuarial (Loss) Gain

Accumulated Other Comprehensive Income (Loss)–End of the Year

Other Current Liabilities

(172,868)

125,411

Deferred Compensation Liability Deferred Credits

$

(692,156)

$

(519,288)

(26,726)

Cash Flows from Investing Activities Change in Inventory - Net of Salvage Contributions in Aid of Construction Received Proceeds from Disposition of Property

12

SECO Energy 2019 Annual Report

STATEMENTS OF CASH FLOWS | DECEMBER 31, 2019 AND 2018

2019 2018

2019 2018

Proceeds from Redemption of Patronage Capital Certificate

381,213

684,927

Cash and Cash Equivalents, End of Year

Proceeds from Redemption of Other Investments

57,155

370,732

Supplemental Disclosures of Cash Flow Information

(220,601)

(146,496)

Purchase of Other Investments Extension and Replacement of Plant

(68,637,402)

(63,186,735)

(7,542,289)

(4,490,820)

(56,943,619)

(54,500,531)

Plant Removal Cost

Net Cash Provided by (Used in) Investing Activities

Line of Credit (Net)

(19,767,298)

1,526,830

Proceeds from Long-Term Debt

45,500,000

72,000,000

Payments on Long-Term Debt

(17,821,616)

(18,647,399)

Payment to Cushion of Credit

18,461,163

(25,114,420)

(1,595,136)

(918,207)

470,529

774,111

25,485

24,340

1,345,150

-

Other Equities Membership Fees Reallocation of Unclaimed Patronage Capital Retirement of Capital Credits

$

2,027,502

$

16,655,345 $

2,468,372

15,054,955

Supplemental Schedule of Non-Cash Investing and Financing Activities The Cooperative Retired Certain Assets from its Plant Records as Follows:

Cash Flows from Financing Activities

Payments on Capital Lease Obligation

Cash Paid During the Year for: Interest

$

(3,488,223)

(5,364,974)

Net Cash Provided by (Used in) Financing Activities

23,130,054

24,280,281

Net Increase (Decrease) in Cash and Cash Equivalents

(440,870)

(863,743)

Cash and Cash Equivalents, Beginning of Year

2,468,372

3,332,115

Cost of Assets Retired $ 21,374,435 Plant Removal Costs 7,542,289 Material Salvaged (1,695,619)

Net Reduction in Accumulated Depreciation

$

$

27,221,105 $

14,701,232 4,490,820 (1,732,170)

17,459,882

The Cooperative Financed Certain Equipment Using a Capital Lease: Amounts not Included in Proceeds from Capital Lease Obligation

$

2,902,384

$

1,430,443

Amounts not Included in Extension and Replacement of Plant

$

2,902,384

$

1,430,443

SECO Energy 2019 Annual Report

13

Outage Map StormCenter is SECO Energy’s allin-one online outage reporting and communications platform. Members can report an outage 24/7, check the status of an existing outage or report an area light malfunction.

StormCenter is designed specifically for use on your smartphone or tablet.

Enroll in outage notifications to receive updates about current outages or scheduled system maintenance in your area. Members can choose to receive notifications via email, text, voice message or all three. Update your contact information and other settings to prepare for storm season.

Visit SECOEnergy.com > StormCenter to explore the options.

CENTER Report Outage

Check Status

Manage Notifications CHECK STATUS

REPORT AN AREA LIGHT OUTAGE OR ISSUE.

NEED HELP? CONTACT US

14

SECO Energy 2019 Annual Report

LETTER TO MEMBERS LETTER TO MEMBERS LETTER TO MEMBERS

Dear Members, Dear Members, Dear Members,

9

95

95

The work plan includes building new communication towers, The work The planwork includes plan includes new building communication newfiber-optic communication towers, towers, upgrading our radio building system and installing cable and upgrading upgrading our radio our system radio system installing and fiber-optic installing fiber-optic cable cable and microwave backhaul forand automated communications thatand facilitate SECO Energy’s mission is to construct, maintain and restore the microwave microwave backhaul backhaul automated for automated communications communications that facilitate that facilitate SECO electric Energy’s SECO mission Energy’s ismission tooutages construct, is to construct, maintain and maintain restore and the restore the faster and for safer outage restoration. system when occur.

We construct new facilities faster and faster safer and safer outage restoration. outage restoration. electric system electric when system outages when occur. outages We occur. construct We construct new facilities new facilities to meet the growing demand for affordable, safe, reliable power to meet to growing meet thedemand growing demand affordable, for affordable, safe, reliable power reliableand power in the our 2,100-square milefor territory.

Our system issafe, upgraded in ourrigorously 2,100-square in our 2,100-square mile territory. mile Our territory. system Our is system upgraded upgraded and maintained to prevent outages.

Whenis an outage and rigorously rigorously maintained maintained to prevent to to outages. prevent When When outagean outage S t o r m occurs, crews quickly respond restore outages. service an safely.

S t o r mS t o r m occurs, crews occurs, quickly crews respond quicklytorespond restore to service restore safely. service safely.

In 2019, SECO added 6,189 new services. Our member In 2019, SECO In at 2019, added SECO 6,189 added new 6,189 services. new members.

Our services. member Our member count 2019 year-end was 210,815 Growth count of at this 2019 count year-end at 2019 was year-end 210,815 wasmembers.

210,815 members.

Growth Growth caliber is almost unheard of among electric of thiscooperatives, caliber of thisis caliber almost almost size of unheard among electric among is electric as theisunheard median co-op of nationally cooperatives, as the median as thesize median co-opsize nationally co-op nationally is in is just cooperatives, 13,000.

SECO is the third-largest cooperative just 13,000. just SECO 13,000. is the SECO third-largest is the third-largest cooperative cooperative in in Florida and the seventh-largest cooperative in the Floridanation. and Florida the seventh-largest and the seventh-largest cooperative cooperative in the in the nation. nation.

Growth brings its own unique challenges. The Growth brings Growth its brings own unique its own challenges. unique The The cost of everything associated with challenges. operating, cost of everything cost of everything associated associated with operating, with operating, constructing and maintaining a state-of-theconstructing constructing and system maintaining and maintaining a state-of-thea state-of-theart electric is rising.

We are building art electric system electric is system rising.

We ispower rising. are building We are building newart substations, adding transformers new substations, new substations, adding power adding transformers power transformers at existing substations, upgrading voltage and at existing at substations, existing upgradingupgrading voltage voltage and conductor andsubstations, converting critical and overhead conductor conductor andtoconverting and converting critical overhead critical overhead facilities underground. facilities tofacilities underground. to underground.

Our 2020 construction work plan tops $55 Our 2020 Our construction 2020is construction work planto work tops plan $55 tops million and configured preserve the$55 millionbalance and million isbetween configured and isreliability configured to preserve preserve the the and to affordability. balance between balance reliability between reliability and affordability. and affordability.

For just pennies a day, SECO Energy’s For just Forpennies just pennies a day,aSECO day, SECO Energy’s Energy’s Surge MitiGator™ helps take the bite out Surge Surge MitiGator™ MitiGator™ helps take helpsthe take bite the out bite out of damaging power surges and spikes of damaging of damaging powerpower surgessurges and spikes and spikes that can damage or destroy household that can that damage can damage or destroy or destroy household household appliances and sensitive electronics. appliances appliances and sensitive and sensitive electronics. electronics.

This valuable protection is “Made This valuable This valuable protection protection is “Made is “Made in the USA” and includes a beastly in theinUSA” the USA” and includes and includes a beastly a beastly warranty. Visit SECOEnergy.com > warranty. warranty.

Visit SECOEnergy.com Visit SECOEnergy.com > > Energy Solutions > Surge MitiGator EnergyEnergy Solutions Solutions > Surge > Surge MitiGator MitiGator to enroll or learn more today. to enroll to or enroll learn ormore learn today. more today.

SURGE@SECOENERGY.COM SURGE@SECOENERGY.COM SURGE@SECOENERGY.COM

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For J.D. Power award information, visit jdpower.com. | To learn more about SECO Energy visit secoenergy.com.