Annual Report To The Members: August 2012
Looking Out For You
Stable Rates Reign In 2011, 2012
For many years our rapidly growing membership was a driving force at your cooperative, and one obvious measure of our success. But it was never the only measure, perhaps not even the most important one.
With a growth rate just under 1% this year, other "success" factors get the notice they deserve.
Stable rates are a much more important measure for you today. We work diligently to control the cost of our local operations without negatively impacting your reliability or your service. Local costs account for about 30% of the price you pay; the balance is wholesale power.
Our efforts, combined with stable wholesale prices this year, helped us forestall a rate increase and offer you some of the lowest electricity rates in the state and nation.
How low? At an average of 8¢/kwh Cuivre River's residential rates rank among Missouri's lowest-cost energy providers, and match the state of Idaho, which has the second lowest average rate in the country. North Dakota's rates are lowest, at an average 7.8¢/kwh.
Our preliminary financial forecast includes a wholesale price increase in 2013, but even with an increase we expect to remain a low-cost provider.
Capital credit refunds continued in 2012 at a near-record $3.8 million, which also help to offset your cost of electricity. Combined with the 2011 record refund of $3.9 million, these refunds underscore the value of a key cooperative benefit, your ownership. Capital credit refunds may not always be financially feasible, but they are one way your directors express their commitment to you as they refund a portion of your equity to you. Checks will be mailed in early August.
Rebates to promote energy-efficiency initiatives continued to make energy efficiency improvements more affordable, and benefit both individual members and the cooperative as a whole. They reduce the demand for electricity in specific ways that can impact our wholesale costs.
Rebates totaling $496,675 in 2011 and $246,674 already this year have helped members install equipment that will reduce their energy use for many years to come. Unlike other types of companies, we're not always trying to sell you more. We're happy to sell you only what you need.
Fuel diversity. Your cooperative-owned wholesale power suppliers, Central Electric Power Cooperative (CEPC) and Associated Electric Cooperative, Inc. (AECI), continue to use a diverse mix of resources to produce your power, including coal, natural gas, hydropower and wind.
This spring the price to generate your electricity with gas dropped below coal for the first time in our history. This means more of your electricity has been coming from high-efficiency natural gas plants and less from our clean-burning coal plants, as suppliers use the lowest-price fuel. Hydro power remains the least expensive when available, and wind power generally remains the most expensive. Neither offer the reliability of gas or coal, but are utilized when available.
Leadership. Your democratic engagement in the cooperative brought a new director to the board room this year. Tammy Kneib of Wright City was elected in August, and represents your interests on the 12-member board of directors comprised of members like you.
Saving money. We're pleased to continue offering the Co-op Connections card to help you save more than electricity. This unique member card is saving members about $10,000 a month on prescription medicine alone, with an average discount of 42%. Cooperative partnerships locally and across the country can help savings add up for your family and stretch every dollar you earn. The card is one of many free programs offered to us through our membership in Touchstone Energy.
Helping neighbors. Your steadfast penny-by-penny support of Operation Round Up compounds your generosity while affirming your community. Your contributions are a lifeline to your neighbors and community organizations that help families in crisis and address special needs. You are making a difference and help others succeed.
High marks. We're humbled by your confidence, loyalty and kind words expressed during our annual survey. Your responses generated our most recent American Customer Satisfaction Index (ACSI) score of 90. This score, rare in every industry, places us among the top performers in the country.
Legacy. Cooperatives are here for the long haul. Our business model is based on value-driven principles, not just profit. The international community acknowledges 2012 as the International Year of the Cooperative and invites us to celebrate how cooperatives help drive the economy, respond to change, remain resilient during an economic crisis and are serious, successful businesses.
As we serve you in the 21st century, we are proud of the principles and the legacy we share with other cooperatives. Our success in serving you is the legacy that matters most. We are grateful for your support and pledge our ongoing efforts to earn it every day.
Walter Gregory, Board President
Dan L. Brown, GM/CEO