(Pictured above: Central Electric board members and management recently attended the Basin Electric Power Cooperative annual meeting to learn about increasing power costs.)
Manager's Message: Power Costs Expected to Increase
By Ken Schlimgen, General Manager
Thank you to all of the members who attended your cooperative’s annual meeting on Sept. 9. The annual meeting, State Fair, schools starting and football games are a clear signal that fall is here.
Your cooperative has had a busy summer filled with many projects. The largest of those was building the infrastructure for the new High Plains Processing facility south of Mitchell. This was the largest single project your cooperative has ever undertaken. With the leadership of Manager of Operations Brian Bultje, his team completed the project on time on under budget.
In addition, we’ve seen more new homes and projects starting in our service area than expected. This growth is a positive sign for our local economy and naturally increases the demand for electricity. We are not alone in this trend; similar growth is occurring across much of Basin Electric’s service territory.
One year ago, I shared that Basin Electric was forecasting an $8 billion investment in new generation and transmission infrastructure over the next decade. At that time, we anticipated modest wholesale cost increases in 2025 and 2026. Since then, demand has continued to rise, and Basin Electric now estimates more than $10 billion will be required—and on a faster timeline than originally planned.
One major driver of this change is a rule adjustment by the Southwest Power Pool (SPP), our regional transmission organization. The new rule requires Basin Electric to own additional generation assets to ensure enough reserve power is available during times of extreme demand.
Because wholesale power makes up about 70% of Central Electric’s annual expenses, changes at this level have a direct and significant impact on our budget. It’s not something we can absorb without eventually passing some of the cost to members.
So, what can we do together to help? The answer lies in how electricity is used. Peak demand—how much electricity is used at the same time—plays a major role in costs. You can help by spreading out your energy usage when possible and by participating in programs such as water heater load management. Small actions, when multiplied across thousands of members, make a meaningful difference.
As Basin Electric and East River Electric continue evaluating their plans, we are advocating on your behalf to ease the timing and impact of these increases. We know any rise in electric rates affects your families and businesses, and we are committed to managing those impacts responsibly.
This is not the first time we’ve faced challenges of this scale. In the 1980s, Basin made significant investments in new generation that led to rate increases. But those investments were followed by a decade of stability with very little change in wholesale rates. That history gives me confidence in the cooperative model’s ability to adapt, and I remain optimistic about our future.
I will continue to share updates as we learn more. Once wholesale power costs for 2026 are finalized, we will prepare our budget and communicate what that means for members. Thank you for your trust and support as we work through these changes together.
Until next month, stay safe!