By Matt Hanson, McKenzie Electric CEO

The supply of reliable electricity is an important element to the electric service you receive. McKenzie Electric receives its source of electricity from Basin Electric Power Cooperative (Basin) and the Western Area Power Administration (WAPA). Not only is the supply of power an important element to reliability, it is also the biggest expense to your cooperative, accounting for almost 90 cents of every dollar you pay on your utility bill.

Both power suppliers are navigating through transitional periods as demand for electricity continues to grow while the supply of power continues to be influenced by advances in technology and policy. In addition, inflation in crucial goods and services and volatility in various markets associated with the supply of electricity are also placing pressure on costs.  As a result, both Basin and WAPA have signaled increases in their cost of supplying power, which could be seen as soon as the beginning of next year.

Both suppliers are investing in their infrastructure to maintain the reliability of their existing system while investing in new assets to provide a reliable source of power for the future. Supply chain challenges along with regulatory processes create long timelines to site and build new facilities. The power markets, which both suppliers participate in, have also become more dynamic as the generation mix becomes more influenced by renewable sources and constraints due to lacking infrastructure.

As we look to the future, there are still headwinds with significant environmental regulations along with ongoing supply chain challenges which will continue to put pressure on the cost of power. McKenzie Electric is actively engaged with our power suppliers, advocating for a sensible path forward that maintains a reliable, robust system delivering power in the most economical way possible. We will continue to provide updates as we learn more about the potential rate impacts and how they will impact you.