Grand Valley Power Changes Rates for 2023
At its December 2022 board meeting, Grand Valley Power’s Board of Directors approved changes to the cooperative’s electric rates. The changes include an increase in wholesale power rates from its supplier and an increase to cover the rising cost of maintaining the cooperative’s distribution infrastructure.
The cost of electricity is rising across the country. The issue is not unique to any one location or sector. According to the U.S. Energy Information Administration, the average rate for residential electricity has increased by 10.6% over the last 12 months, the largest year-over-year increase in the past decade.
The last two years have seen rapid price increases due to several factors: inflation, pandemic-induced labor and supply shortages, more demand for electricity, the war in Ukraine, and the cost of transitioning to clean energy. The largest impact on energy prices is the cost escalation of natural gas, which is one of the primary fuel resources used by our power supplier to generate electricity.
Grand Valley Power buys the electricity that it distributes to members at wholesale prices from the Public Service Company of Colorado, a subsidiary of Xcel Energy. Xcel Energy notified GVP that it would increase its wholesale rates at the beginning of the new year due to the rising cost of fuel, supplies and labor. As a not-for-profit co-op, Grand Valley Power charges its members for the actual cost of the power they use in kilowatt hours based on their energy consumption, and has no choice but to pass the rate increase through to members. Additionally, the cost of maintaining Grand Valley Power’s distribution system (poles, wire, maintenance, equipment) is increasing. GVP is changing its Grid Connectivity charge to cover these costs and enable the cooperative to continue providing members with the service and reliability they expect.
The changes will take effect on March 1 and be reflected on April bills. The average GVP consumer that uses 847 kilowatt hours per month, with 25% of that usage occurring during on-peak hours, can expect to see their kilowatt hour charge increase by $6.85 per month and the Grid Connectivity charge increase by $1.50 per month.
FAQ
The “average” GVP consumer uses 847-kilowatt hours per month, with 25% of that usage occurring during on-peak hours. Beginning in April, this average consumer would see his or her kilowatt hour charge increase by $6.85 per month and the Grid Connectivity charge increase by $1.50 per month.
The rate change will go into effect March 1, 2023 and be reflected on April bills. Your Board of Directors decided to hold off on passing through the Xcel rate increase until the spring months when bills are typically lower.
Grand Valley Power is a not-for-profit cooperative owned by you, the members, and governed by a Board of Directors elected by the membership. Your cooperative is accountable to consumer-members, not outside investors, and works hard to provide reliable power and quality customer service at the lowest possible cost. Your cooperative works to control costs, but inflationary pressures have raised the costs of wholesale power and delivering that power to our members beyond what we can control.
It might be helpful to note that the last time Grand Valley Power adjusted its rates was in March 2022, and that the co-op did not change its Grid Connectivity fee. At that time, and after an extensive Cost of Service Study, the co-op restructured its rates and raised its energy charges to cover wholesale power cost increases and closely align each rate class with the costs incurred in providing that service. The new Time-of-Use rates provide a more equitable cost structure and give members the ability to control their energy costs by shifting usage to off-peak hours.
The last time Grand Valley Power changed its Grid Connectivity fee was in 2015 when the co-op also lowered its energy charges, resulting in a revenue-neutral rate adjustment.
It’s no secret that energy costs are increasing. The issue is not unique to any one location or sector. The cost of electricity is rising across the country. According to the U.S. Energy Information Administration, the average rate for residential electricity has increased by 10.6% over the last 12 months, the largest year-over-year increase in the past decade.
The last two years have seen rapid price increases due to several factors: inflation, pandemic-induced labor and supply shortages, more demand for electricity, the war in Ukraine, and the cost of transitioning to clean energy. The largest impact on energy prices is the cost escalation of natural gas, one of the resources used by our power supplier to generate electricity.
It’s a combination of factors that we have never seen before.
According to the U.S. Energy Information Administration, the average cost of electricity per kilowatt hour (kWh) in the U.S. was 0.1609 in October 2022. Grand Valley Power’s rates were about 15% less in the same time period based on our average consumer, with 25% of usage occurring during on-peak hours.
Members can keep electricity bills low by considering two factors: overall energy consumption and time of use.
Our website offers tips for efficient energy use.
Time of use is also an important consideration. With Grand Valley Power’s Time of Use rates, members can save on their electric bills by shifting energy use to off-peak hours, before 4:00 p.m. and after 9:00 p.m. daily. (On-peak hours when rates are higher are 4:00-9:00 p.m.)
Members also can help control the costs of providing safe and reliable electricity by signing up for paperless billing and electronic payment options.
Programs are available for eligible consumers who need assistance with their electric bill. A list of resources is online: gvp.org/energy-assistance