Editorial: Paul Matthys

It is hard to imagine that 2024 is “in the books” and that we are already plowing our way into 2025. I hope everyone enjoyed the holiday season and could spend time with family and friends. In this article, I will spend a little time reflecting on the past year, but I will dive into some plans and what is in store for your cooperative in 2025.

As with every other year, 2024 had its ups and downs, but we ended well financially with rebounded energy sales in the last half of November and December. Look for more detailed information in the April Annual Report.

I have spent more than 24 years of my career at Cass County Electric, and staying employed here for 30-plus years is not uncommon. However, we are seeing some natural attrition and a changing of the guard, if you will. This year alone, five employees will be retiring, including our chief financial officer, chief information officer, manager of IT, fleet supervisor, and manager of system operations.

Now, this can seem overwhelming and even scary, but rest assured that we have an excellent succession plan and a strong recruitment system. Building our bench, cross-training, employee development, and training plans have all been essential to our strategic business plan to ensure our member service does not waver.

Our strategic business plan also includes managing tighter budgets, reducing expenses, and evaluating financial decisions related to leasing or purchasing large power-operated equipment (i.g., bucket trucks, digger-derrick trucks, etc.). Safety awareness and risk mitigation will be at the forefront of our newly revised strategic business plan. We will continue to put the safety of our employees and our members at the very top of our priority list. We will also increase our safety awareness communication with our industry partners, including builders, contractors, and developers.

Paperless billing, autopay, and the Cass County Electric app will continue to be promoted. I urge everyone to participate in these opportunities and to please consider signing up if you aren’t already. These are excellent ways to allow us to use less paper, control expenses, and better engage with our members.

I will briefly cover the future of rates and wholesale power costs. Cass County Electric is a distribution cooperative, and we purchase all our wholesale energy (other than a small portion from our Prairie Sun Community Solar array) from Minnkota Power Cooperative. In past articles and annual and member meetings, I have shown that we have had stable electric rates for the past seven years despite the upward pressure on material, labor, and operating expenses.

Beginning in April of this year, we will see an 8.3% wholesale rate increase from Minnkota. Our plan for this increase is not to raise rates immediately but to utilize the purchase power adjustment tool and evaluate the wholesale rate increase related to our retail rates through a cost-of-service study. The key components of our historic rate stability are strong load growth, a strong balance sheet, and efficiently managing the cooperative's costs, which still holds true today.

The purchase power adjustment, or PPA, is a line item on your electric bill. We use this tool to adjust for fluctuating wholesale power costs without regularly adjusting the base rates. The PPA is calculated using a four-month average from our wholesale power bill, so you won’t see much of an increase until you receive your July statement. The 8.3% wholesale rate increase will have about a 6% impact on your bill through the PPA calculation.

Transparency and communication about rate increases are paramount to us. We understand the frustration that inflationary price increases for almost everything in our daily lives have caused recently. We are proud of our track record of stable electricity rates over the past seven years, while inflation, measured by the Consumer Price Index, is up 25% over the same time frame. As we learn more about the impacts of the wholesale rate increase, we will continue to communicate the adjustments and changes through our communication channels.

2025 looks to be another excellent year for growth and a more energy-friendly environment. We will continue to prioritize safety, affordability, and reliability.