Word From Leadership

Cass County Electric Cooperative (CCEC) is considered a growth cooperative, meaning we add new accounts and increase energy sales and revenue annually. We have added an average of 1,608 accounts annually for the past 24 years. According to the National Rural Utilities Cooperative Finance Corporation’s (CFC) Key Ratio Trend Analysis (KRTA) results, CCEC ranks in the top 9% of 809 electric distribution cooperatives nationwide for growth. We are also a weather-dependent business, and sell more energy during cold winters and hot summers.

2024 turned out to be a pretty good year for sales and growth, but slightly lower than we anticipated and below our 2023 numbers. We ended the year by adding 1,466 new accounts compared to 1,590 in 2023. Energy sales were down 0.5% from 2023 and approximately 1.5% below the 2024 budget. High interest rates, inflation, supply chain issues, and mild temperatures at the start of the year influenced these figures.

While we continued to heal from the 2023 Christmas ice storm, we managed to maintain a healthy financial balance sheet. CCEC has 48.41% equity, which is 19% higher than our peers. Annual electric revenue was up 2.2% or $3.4 million compared to 2023, excluding the $4.9 million deferred revenue recognized in 2023. The cost to operate the cooperative, or the distribution adder, was $0.0246/kWh, 42% below similar-sized cooperatives in the nation. This is due to the efficient operations of our employees and the board of directors.

2024 marked the seventh consecutive year of flat electric rates. We attribute this to efficiently managing expenses, annual load growth, fiscal responsibility, and no increases from our wholesale power provider, Minnkota Power Cooperative (Minnkota). Operating expenses, excluding power costs, were up 7.5%, mainly due to the ice storm in 2023. Operating margins totaled $7.18 million, coming in 5.25% below budget and $367,000 lower than 2023, excluding the $4.9 million deferred revenue recognized in 2023. Eide Bailly, CCEC’s financial audit firm, issued an unmodified opinion on the 2024 financial statement audit, indicating a clean report with no adjustments needed. We can attribute this to having professional and dedicated finance and accounting employees.

Overall, 2024 was a good year for the cooperative, and your board of directors approved the payout of $3.5 million in capital credits to members who used electricity in 2003 and 2004 (a partial year), including estate and early retirements. Capital credit payments are unique to the cooperative business model and are just one of the many benefits of being a cooperative member-owner.

During the annual reorganizational meeting the following directors were reelected to their positions; 

Director Glenn Mitzel Chairman
Director Terry Kraft Vice Chairman
Director Paul White Secretary
Director Kalvin Hoff Treasurer
Vanessa Kummer was elected as your director representing District 3 (Colfax area). 

This April will mark my first year serving as the President and CEO. I have been working very closely with the board of directors on implementing a newly revised strategic business plan, updating policies, and ensuring financial security for the cooperative. The board of directors also approved Vogel Law as CCEC’s official legal counsel.

Our engineering and operations team has diligently worked on system maintenance, rebuilding some of our utility plant after the 2023 ice storm damage, embracing new technology, and shooting for 100% reliability. FLISR (fault location, isolation, and service restoration) software is one technology we have been utilizing to achieve our reliability goals; in fact, 2024 was a record year for reliability for CCEC. With zero major events, the system average interruption duration index (SAIDI) was 24.5 minutes, and the average service availability index (ASAI) was 99.9953%.

High-level member service is another primary focus of ours. In 2024, we surveyed our members and scored 89 (on a 100-point scale) on the American Customer Satisfaction Index (ASCI®). Our board of directors and employees are Driven to Deliver. Providing member services, engaging with our community, and giving back are essential core values that we follow.

Cybersecurity continues to be a top priority for us. Our internal information technology (IT) team provides our employees with regular cybersecurity training and awareness programs. They also avoid emerging threats by maintaining updated cybersecurity software and tools. Additionally, we utilize external experts to perform IT security audits.

As we look forward, we have an abundance of opportunities, and we are well-positioned financially. We will continue working with Minnkota to consider carbon capture and storage technologies while evaluating all sources for future power supply. We will study and assess the system’s needs for fast-paced electricity demand, including data storage, manufacturing, and residential growth. We will advocate pro-energy policies at the local, state, and federal levels to ensure reliability and affordability are at the forefront.

Beginning April 1, 2025, we will see an 8.3% wholesale rate increase from Minnkota. Because of our load growth, a healthy balance sheet, and fiscal responsibility, we are not adjusting base rates in 2025. We plan to absorb some of the increases and gradually pass them on through the purchased power adjustment (PPA). We will perform a cost-of-service study in 2025, and the board of directors and management will evaluate and consider adjusting the base electric rates in 2026 accordingly.