November 2023 Board Meeting Summary
PrintBoard Meeting 11.27.23 Tony’s Pizza, Silver Cliff, 9 a.m.
November’s meeting opened with acknowledgement of, and a moment of silence to observe, the passing of Sangre de Cristo Electric Association Director Dan Daly from an acute form of Leukemia.
Daly, who was very highly regarded, was described as father, grandfather, husband, patriot, advocate, educator, attorney, and friend by director Charles A. Abel II. Abel said Daly made a difference and that he was thankful for his selfless contributions to SDCEA and to learn from him. Abel extended his deepest condolences to Daly’s family. Daly’s obituary can be found here. Dan Charles Daly | Obituaries | chaffeecountytimes.com
Directors Abel, Jeff Fiedler, Mark Boyle, and Sandra Attebery attended in-person. Blake Bennetts attended by Webex and phone. Nick Hellbusch joined the meeting at 11:20 a.m. by phone.
2024 Operating and Capital Budget
Chief Financial Officer Sarah Crites presented a narrative of the 2024 Operating and Capital Budget, which appears here.
The board voted unanimously to approve the budget.
2024 Rate Increase Proposal – Two options for a rate increase were considered at the meeting. The first option increased rates by 8 percent and used no deferred revenue to offset the rate increase. This option had a lower increase in the service availability charge and higher increase on energy costs.
The second option had a higher service ability charge increase and lower increase on energy costs. This option also used deferred revenue to decrease the bill impacts to the membership for 2024-2026 and increases the service availability charge by 10% for years 2025-2027.
Calling for the question to increase the service availability charge less and energy costs more, the proposal failed on a 2-2 vote, with a tie-breaking vote cast by SDCEA Board President Sandra Attebery against.
On a second vote for the option to instead opt for a higher service availability charge increase and lower energy cost increase, the board again tied 2-2, with Attebery voting in favor of the proposal.
For the average residential consumer, this could result in an approximate monthly bill increase of $5-$9 beginning in February 2024. The rate increase will raise the monthly service availability charge for general service residential members from $31.83 per month to $35.01 a month and the energy charge from $0.12944 per kWh to $0.13485.
Adjusting the rates aligns with current industry trends and promotes the reduction of carbon emissions.
The change also shifts a larger portion of operating costs to fixed charges in the service availability charge, rather than adding those costs to energy charges. This ensures a more accurate recovery of both operating and energy costs.
Additionally, the increase in the kWh charge acts as a price signal that encourages energy efficiency.
By decoupling cost recovery from weather conditions, this option enhances SDCEA’s financial stability, providing a secure financial outlook for the next four years. It enables SDCEA to give customers advance notice of expected rate increases and facilitates the implementation of innovative rates and fair cost allocation for SDCEA’s 14,300 services.
Financial Report
Year-to-date (October 2023): Revenues are 4.1% over budget due to selling more energy (kWh) than forecasted in the budget. The 2023 budget is based on SDCEA’s year-over-year average of energy (kWh) sales, with a slight increase for growth in number of consumers and sales. January-April 2023 was colder than January-April of 2022, and some increased energy sales continued during July, possibly due to cooling demands during July. Year-to-Date, more energy (kWh) sales (3.8% higher) have occurred than 2022. The cooperative in turn purchased additional power to cover this increase in sales. This increased purchased power expense was primarily offset by a decrease in operating expenses due to several employment positions being open and lower than budgeted interest expenses on long-term debt. Overall, total expenses are within 1% of the budget.
Operations Report
Wildfire Mitigation Update:
Two mitigation crews are working in Lake County and will move to Fremont and Custer counties for the remainder of the year. SDCEA will increase to 3 or 4 crews at the start of the new budget year and is developing a plan to perform cutting in the town of Buena Vista.
Project Totals since inception:
Total Overhead Line Miles in System: 750
Estimated miles to be Cut/Trimmed: 264
Total Miles Cust/Trimmed: 117
Percent Complete: 44
Estimated Project Cost: $9 Million
Total Project Spend: $4,775,538
Amount Remaining to Spend: $4,224,462
2023 Budget $1,965,214
2023 Spend Year to Date $1,661,167
2023 Budget Remaining $304,542
Total Trees Removed – 9460
Total Trees Trimmed – 2317
Hazard Trees Removed – 477
The meeting adjourned for lunch, provided by Tony’s Pizza. Several community members joined the board for the meal. The board then reconvened into an executive session at 1:22 p.m. to discuss matters to be held in confidence. No action was taken by the board after the executive session.
