With so much of the news over the past month being focused on the winter storm and record-breaking electricity demand, you may have more questions about what it all means for Grand Valley Power members going forward. You may have seen news reports indicating that Xcel Energy faces expenses totaling $650 million because of the winter storms, with much of that expense stemming from a spike in the cost of natural gas needed to heat homes and generate electricity. Grand Valley Power members were spared from extreme conditions and crippling outages impacting electric consumers in February; however, since we buy wholesale power from Xcel, GVP and its consumers were not insulated from the price spikes.
Grand Valley Power received its latest wholesale power bill from Xcel earlier this week. This bill includes a Fuel Cost Adjustment of $2.37 million. While we have a Fuel Cost Adjustment on every monthly bill we receive from Xcel, the amount has never approached the magnitude seen on our bill for February 2021 – the period when the record-breaking winter storm hit the central United States. We typically pass our wholesale power cost on to our GVP distribution customers each month. If we were to do this with our February bill, it would be difficult for many of our consumers to deal with. We are working hard to develop plans to recover these costs in a fair way, without imposing hardship on any of our consumers. We are also scrutinizing the charges from Xcel, and if warranted, we will challenge them. A few other big utilities like Black Hills and Colorado Springs Utilities reported losses similar to what Xcel experienced. Others, including Tri-State Generation and Transmission Cooperative, which serves more than 40 cooperatives, including 17 in Colorado, will be able to absorb all expenses from the winter storms without passing them on to their customers. This raises a good question: why does it seem that Tri-State was so much better prepared for this event than Xcel?
We will be communicating with every member, within the next couple of weeks to let you know how your GVP power cost will be impacted by the winter storm events. Everyone on the Grand Valley Power team understands that our members expect and deserve a reliable, affordable source of electric energy. We will continue to do all we can to meet your needs.