WESTERN SLOPE – The Delta-Montrose Electric Association Board of Directors appears to be at odds with the Tri-State Generation and Transmission Association over the electric wholesale provider’s new rate structure, which one DMEA Boardmember called an “anti-efficiency rate.”
Following other electric cooperatives in Colorado and New Mexico, DMEA may consider appealing the rate structure to the Colorado Public Utilities Commission.
After the DMEA Board of Directors appointed a committee to consider what the rural electric cooperative’s position should be on Tri-State’s new rate structure, called A-37, which became effective Jan. 1, DMEA announced in a press release that it believes A-37 does not adhere to historic DMEA rate-making principles.
“I can only speak for myself, but I don’t like the rate increase,” DMEA Boardmember Ed Marston said. “We invested heavily in automatic meters to help people even out their use of electricity and thereby help the entire system. The rate increase makes that investment worthless. We see it as an anti-efficiency rate.”
Tri-State’s A-37 structure imposed a 4.9 percent rate increase to its 44 member cooperatives in 2013. This increase comes on the heels of a 5 percent increase in 2012. Besides the actual increase, Marston said, the rate structure does not incentivize steady power usage, which will hurt the cooperatives’ steadiest power consumers, including the North Fork coal mines near Paonia. The new rate structure will limit smart grid opportunities, risking DMEA’s popular Time-of-Use rate.
“A-37 has no incentive to even use,” he said. “Residential users like you and me, we tend to use electricity in spurts. We are not good consumers. A coal mine or a pipeline, they are the really good customers and they are the ones who have been hit the hardest by this. Thirty percent of DMEA’s load is coal mines, and this just kicked them in the gut.”
So far three other Colorado electric cooperatives operating under Tri-State have made appeals to the CPUC for relief from the new rate structure. Other cooperatives in New Mexico have succeeded in their appeals, and their rates have been suspended. Marston said the DMEA Board of Directors is still considering whether or not it will appeal the rate structure as well.
“Tri-State, in my memory, has never done a cost of service study,” Marston said. “Who knows what they should be charging to whom? We are still studying it. We are waiting to see what they do in their May meeting, and then we will go from there.”