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Fuel Costs Drive Wholesale Power Cost Increases
>> For Tri-County EMC consumers, 2005 has been a volatile year. We began the year facing higher fuel costs due to higher crude oil prices. Then Mother Nature brought her influence to bear. High temperatures, violent hurricanes and record oil prices have consumers bracing for higher heating costs this winter in addition to higher prices for all consumer goods. While Tri-County members will not see the drastically increased costs predicted for natural gas and other fossil fuels, the cooperative’s members will see increased costs for electricity beginning in January.
In the past 12 months, wholesale power costs as a percentage of each energy dollar you purchase have risen from 62.3 percent to 68.4 percent. We have some control over how we run our generation. We manage purchases from other suppliers through long-term contracts. Unfortunately, we cannot control the price for fuel, natural gas, oil and coal to operate these plants. What we can control is our operating costs, those costs associated with maintaining our distribution system, delivering power to your home, billing you and providing customer service. We have worked very hard at controlling these costs, and this work has paid dividends. Tri-County EMC’s rates are at an unprecedented competitive level, lower now than the state average or our competitors. Those rates must go up in response to increased costs.
In January, our minimum charge, which recovers most of the cooperative’s fixed operating costs, will increase $3 per month. As we work to finalize our budget, we will complete a financial picture that will show costs projections for wholesale power in 2006. Additional cost increases will be added to each kilowatt hour sold. The fuel adjustment each month will reflect variances, either higher or lower, in the wholesale power cost. As a cooperative, Tri-County cannot make a profit. But, we must recover costs. Our commitment to you remains the same. We will continue to work to keep your business in the best possible financial position while maintaining the levels of reliability and customer service that you expect. Even with these increases, we are pleased that electricity from your cooperative will remain your best option for comfort and efficiency. <<
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