Tri-State returning $10 million in patronage capital to members for 2022
- Refund demonstrates benefits of the cooperative business model, Tri-State membership.
- 4% wholesale rate reduction saves members approximately $65.8 million in 2021 and 2022.
(December 16, 2022 – Westminster, Colo.) The board of directors of not-for-profit wholesale power supply cooperative Tri-State Generation and Transmission Association have approved the return of $10 million in patronage capital refunds to its members for 2022.
Patronage capital represents each member’s equity in Tri-State and is an accumulation over the years of the net margins earned by Tri-State and allocated to its members. Including 2022, Tri-State has returned approximately $150 million to its members over the past seven years.
“The allocation and return of capital to our members is a hallmark of Tri-State’s cooperative business model, strengthening members’ balance sheets and cash flow,” said Tim Rabon, chair of the Tri-State board of directors and a trustee for the Otero County Electric Cooperative in Cloudcroft, N.M.
Wholesale power rate reduction reduces member power costs
A 4% wholesale power rate reduction agreed to between Tri-State and its utility members has resulted in a total savings of $65.8 million for its utility members between March 2021 and the end of 2022. Lower wholesale power rates saved utility members $20 million in 2021, and member savings are estimated to be $45.8 million through the end of 2022.
Tri-State’s wholesale rate for its 42 utility members in Colorado, Nebraska, New Mexico and Wyoming had remained flat since 2017, and wholesale rates were lowered in 2021 and 2022. Tri-State’s wholesale rate uniquely includes everything required for delivering power into its member’s distribution systems, including energy, capacity, transmission, and a wide range of products and services.
“Working with our utility members, we reduced wholesale power rates for members, which has helped members to mitigate inflationary and supply chain cost increases that are placing upward pressure on electric utility costs,” said Duane Highley, CEO for Tri-State.
2023 budget maintains reduced wholesale rates for members
In December 2022, the Tri-State board approved the cooperative’s 2023 capital and operating budgets, which keep wholesale rates flat. Despite significantly higher fuel and market power costs, Tri-State has been able to maintain stable rates with cost reduction efforts and the recognition of deferred revenue. Tri-State is evaluating revenue requirements in 2023 and into 2024.
“Tri-State is not immune from the cost pressures driving electric utilities rates higher,” said Highley. "Tri-State is working diligently to postpone the need for and minimize the size of a wholesale rate increase that will necessarily be part of our rate filing with the Federal Energy Regulatory Commission in mid-2023.”
Tri-State is a not-for-profit power supply cooperative of 45 members, including 42 electric distribution cooperative and public power district members in four states. Together with our member/owners, we deliver reliable, affordable and responsible power to more than a million electricity consumers across nearly 200,000 square miles of the West. For more information, visit www.tristate.coop.
Certain information contained in this press statement are forward-looking statements including statements concerning Tri-State’s plans, future events, and other information that is not historical information. These forward-looking statements are subject to a number of risks, uncertainties and assumptions, including those described from time to time in Tri-State’s filings with the Securities and Exchange Commission. Tri-State’s expectations and beliefs are expressed in good faith, and Tri-State believes there is a reasonable basis for them. However, Tri-State cannot assure you that management’s expectations and beliefs will be achieved. There are a number of risks, uncertainties and other important factors that could cause actual results to differ materially from the forward-looking statements contained herein.