Earlier this year we announced the potential for making adjustments to the electric service charge (ESC). We discussed the reasoning for the adjustment and how it would impact our members, as well as the board’s desire to make a small adjustment now for maximum impact to cooperative revenue rather than making significant changes to the actual kilowatt-hour charge, which would require a cost-of-service study.
In July, the board of trustees took another look at a proposal made after the results of a revenue requirement study FreeState underwent earlier this spring. It was determined that it was time to take some action following the delay due to the COVID-19 pandemic.
Earlier this year the board was prepared to make a small adjustment to the ESC but chose to wait due to the financial hardships many experienced during the pandemic and economic shutdown. As we started the road to recovery the board continued to hold off on making the decision, hoping things would take a positive turn. Although things are looking up, it is just not enough. The board understands there will never be a good time to make an adjustment, but it is now time to make a decision.
As we move forward, the board is looking at making an adjustment beginning in 2021. With advance notice and an extended period of time before implementation, we hope our members will be more prepared to make an adjustment to the fixed charge.
Why are we making the adjustment? It’s the best option right now. The next two pages will go into more detail about why the adjustment is needed, and how it will impact our members. There will be more information on what exactly the ESC covers and how it is the most impactful way we can help mitigate revenue losses with a minimum effect on our members’ monthly bill.
Next month, we’ll talk more about the process the co-op will undergo and how each member can offer input on this decision.