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Budget Projects Record $114 Million In 2015 Costs


Cuivre River Electric Budget Projects Record $114 Million In 2015 Costs.Cuivre River's annual expenses are expected to hit an all-time high of $114 million this year, according to the 2015 Budget approved by the Board of Directors in mid-December.


Budget projections include kilowatt-hour (kwh) sales of 1.3 billion for the year, reflecting a 1% growth in kwh sales, according to General Manager/CEO Dan L. Brown. With a modest increase in construction, the cooperative is also on pace to add about 1,000 new meters in 2015.


To cover 2015 expenses, the budget meets revenue goals without a rate increase for energy charges for the sixth consecutive year. The cooperative will absorb energy-related costs within the existing rate structure.


However, for the first time in eight years the budget includes a 10¢ per day increase in the Schedule "A" Residential Service Availability fee for non-energy costs. "The daily fee helps support every part of the cooperative's operation except our wholesale energy," says Brown.


"The adjustment from 50¢ to 60¢ will help us manage the cost increases we have been experiencing over the past eight years." It will become effective February 1, 2015.


About the budget: The direct cost of power is expected to exceed $72 million, representing 70% of all budgeted expenses. Energy cost projections reflect wholesale power expenses that are based on previous energy use and demand patterns and growth in the number of meters served.


Cuivre River's monthly 2014 wholesale power bills, which trended closely with weather conditions affecting residential energy use, ranged from an all-time high of $7.29 million in January to a low of $4.94 million in April. More than 90% of the cooperative's meters serve residential consumers.


The remainder of the 2015 budget addresses daily operations, capital expenses, interest and depreciation. "The cost of doing business continues to escalate," Brown says. "Distributing electricity is a very capital-intensive business." He cites the rising cost of poles, transformers, wire, vehicles, ongoing line maintenance and construction, voltage conversions, pole replacements, automated meter reading equipment and installation, pole and equipment inspections, right of way maintenance, data management, workforce costs and benefits, building operations, safety and security.


Revenue projections for the 2015 budget must cover energy costs, capital costs and all operations.


Schedule "A" daily service fees affect residential consumers, small nonresidential consumers and small single-phase commercial consumers. Daily fees for other rate schedules will also receive an incremental adjustment.


Electricity costs for Cuivre River members will continue to remain among the lowest in Missouri and much lower than the national average.


Did you know?


  • Cuivre River serves an average of 11.32 members per mile
  • Cooperative utilities nationwide average 7.4 members per mile
  • Investor-owned utilities average 34 customers per mile
  • Municipal utilities average 48 customers per mile