Co-op will raise rates for members

This week’s article about the Flathead Electric Cooperative incorrectly stated that the board of trustees had chosen not to raise rates for Co-op members even after a significant wholesale power rate increase was imposed on the Co-op.

According to Co-op general manager Ken Sugden, retail rates for Co-op members will increase by 3.5 percent starting June 1, and they will likely increase by 3 to 3.5 percent a year each June 1 for the next 10 years. The exact amount three to four years in the future is difficult to predict, Sugden said.

The reason for the rate increases is that the Bonneville Power Administration raised wholesale rates to the Co-op in October 2010 by 7.5 percent and is expected to raise wholesale rates again in October 2011 by 10 to 11 percent.

The Co-op’s board of trustees chose not to raise rates to Co-op members after the October 2010 increase by the BPA to help members get through the winter.

The BPA will cap the amount of power it will sell to the Co-op based on the amount of power the Co-op uses in October 2011. At the present time, all power used by the Co-op comes from the BPA, except for a small amount from its landfill gas project, Sugden said. The BPA cap could be around 169 megawatts, while the landfill gas project generates about half a megawatt, he said.

As demand on Co-op power continues to grow in the future, the Co-op will need to find additional sources of power, which could include purchasing power on the open market or supporting local power projects like the city of Whitefish’s hydroelectric project, or reducing the load further with additional conservation measures.

Addressing growing demand without relying on inexpensive BPA power will be the driving force for higher rates to Co-op members.