Wholesale electricity provider, Tri-State Generation and Transmission, has filed a rate case with the Federal Energy Regulatory Commission (FERC) that is expected to raise wholesale rates paid by local non-profit, San Miguel Power Association (SMPA) by over 6% in 2024. This, in combination with inflationary pressures on the prices of tools and materials, prompted the SMPA Board of Directors to approve an increase to its monthly access charge at its October Board meeting. However, the increase will not be enough.
“This $2 increase will not cover the projected increase in our wholesale power costs,” says SMPA Chief Executive Officer, Brad Zaporski. “However, through tightening our belt and successful long term financial planning we will be able to cover our expenses while giving our members room to adjust to market conditions.”
Several times over the past four years, the SMPA Board of Directors has taken advantage of opportunities to defer revenue. This practice, a rate-stabilization tool, will make up for any losses SMPA may realize next year.
The increase will raise the fixed access charge with no change to the kWh energy rate. For most residential consumers, the $2 increase will place the monthly Access Charge at $25, which remains one of the lowest grid access fees in Western Colorado.
Chief Executive Officer, Brad Zaporski summarized the 2024 rate increase by saying, “I am proud of the SMPA staff’s efforts in cost containment, as well as our Board’s multi-year financial strategy of using deferred revenue to keep this rate increase to a fraction of the rate of inflation.”
Before the board voted, they heard from members who wished to comment on the proposal. Once all comments had been made, the board continued with its meeting, and approved the recommended $2 increase.
For reference, a listing of the current rates and the approved increase are available on www.smpa.com/rates. The new rate will go into effect January, 2024.