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Manager’s Message

Michael (Mike) Heise

President and Chief Executive Officer of Cloverland Electric Cooperative.

Electric Rates are Increasing, but Electricity Remains an Exceptional Value

At Cloverland Electric Cooperative, we know our members put a lot of trust in us to be responsible with their money. We bear this trust in mind each time we purchase new equipment or invest in upgrades for our infrastructure.

The same is true when we determine rates for the electric service our members depend on. As a not-for-profit utility, we never charge more than is needed to maintain and operate our electric system responsibly. Remaining funds are returned to members in the form of capital credits – cash back over time.

As a co-op member, you can trust that when we adjust rates, we will only do so with a good reason – to cover the key components essential to keeping power flowing to our 34,000 members across five counties.

Electric co-ops are not immune to inflation, which has led to an increase in materials costs and equipment we rely on to maintain our system. As I shared in the August community presentations, Cloverland has endured major increases on materials due to inflationary pressures and lead times impacting vendors, contractors and suppliers.

While rates have remained fixed since 2017, costs have increased considerably in the last few years. The 5% increase for 2023 is equivalent to an increase of 1% each year and enables us to maintain a strong financial position while enhancing our infrastructure. Here’s how it will affect each rate class:

  • Residential members (1 percent of total co-op members; 40.4 percent of energy sales) will experience a 5.4% increase of $4.73 each month based on an average usage of 658 kwh.
  • General service members (10.5 percent of energy sales) with an average monthly usage of 1,298 kwh will experience an increase of $8.54.
  • General service 3 members (10.4 percent of energy sales) with an average monthly usage of 10,041 kwh will experience an increase of $56.03.
  • Large power/industrial members (38 percent of energy sales) with an average monthly usage of 61,812 will experience an increase of $391.06.

The current facility charge, $23.75 for residential members, will increase slightly to $24. This monthly charge covers costs required to provide electric power to members other than purchased power costs and demand costs. These costs include more than 3,112 miles of overhead power line, 72,418 poles that hold the lines, 922 miles of underground cable, 38 substations, a fleet of trucks and tracked/all-terrain vehicles, plus all the associated hardware required to operate the cooperative’s distribution system spread across five counties in the Eastern Upper Peninsula.

While rising costs seem beyond our control, our own energy usage is not. We encourage all of our members to be mindful of the ways they use electricity on a daily basis. With the peak demand charge as part of the new rate, members can save on electricity costs by running large appliances after 9PM or before 9AM.

A great resource for a home energy audit is our Energy Advisor tool that demonstrates ways to save energy around your home. Visit Cloverland.com/energyadvisor and check out current energy optimization incentives for additional savings. Follow us on social media for additional tips for each season. Remember that your cooperative will always keep reliability and affordability at the forefront of all we do.

 

Kind regards,
Michael (Mike) Heise

By The numbers