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GCEA officials say rates will increase in coming years

Demand and renewable energy efforts contribute

The price of electricity went up once again this year, and Gunnison County Electric Association (GCEA) officials say it’s more important than ever to conserve energy in households and businesses.

 

 

On January 1, 2008 GCEA increased its rates by approximately 11 percent, or a total of $1,383,000 over last year’s revenue, according to a press release issued by the company. GCEA serves more than 9,000 customers across seven local districts, including most of Gunnison County as well as portions of Saguache and Montrose counties.
GCEA obtains the majority of its power from Tri-State Generation and Transmission, a power provider that serves more than seven million customers across the mountain west.
According to the press release, about $900,000 of the increase, or 7 percent, is a direct result of Tri State increasing its costs, which also took effect in January. This is the fourth year in a row Tri-State has increased its power providing costs.
The rest of the local increase goes to GCEA to cover administrative fees, operating expenses and system improvements needed to support growth and provide reliable power.
For general consumers, this means the price per kilowatt hour (most homes use between 500 and 800 per month) will increase to $.104 from $.093. In 2003 the rate was $.079.
The price of electricity has risen several times in the last few years, and it may continue to rise for years to come, officials say.
GCEA board president Chris Morgan says growing demand for electricity is inevitable in the next few years. "Conservation alone is not going to stop the need to build new generation, in terms of population growth, and industrial growth," Morgan says.
A limited supply of power currently, Morgan says, is partially to blame for increased rates. "We’re forecasting our power supplier (Tri State) to increase their rates 30 percent in the next 10 years. What’s driving some of that is the increasing cost of construction of new generation as the demand for electricity continues to grow," he says.
Simply finding a different power supplier, or switching to renewable energy sources, isn’t necessarily the best answer, Morgan says.
Morgan says the type of power generation that is used will affect the cost. Coal is currently the cheapest, but if a tax on carbon emission is passed into law, coal power could be very expensive, he says.
Natural gas is another option, Morgan says, but limited supply means it’s an expensive alternative.
Another option is nuclear power, which may become cheaper than coal power in the future. "Nuclear becomes the cheapest, long-term generating solution," Morgan says.
Additionally, Morgan says, as oil becomes more expensive, "You’re going to see an increased reliance on electricity."
Energy legislation could also have an effect on electricity bills. In 2007 the state of Colorado passed more than 20 laws relating to energy conservation and renewable energy, and similar energy bills are currently being weighed by the legislature this year. One of these, House Bill 1107, would require rural electric co-ops like GCEA to spend 2 percent of their revenues on conservation and renewable energy programs by 2010.
Morgan says GCEA made $14 million in gross revenues last year. If House Bill 1107 passes, Morgan says it would require GCEA to spend $280,000 a year on renewable energy and conservation programs. "The passage of that bill would go into a 2 percent surcharge in your bill," Morgan says.
Alliance for Clean Electricity member Bruce Driver says this is a cost that Tri State should help with. "It’s in Tri State’s interest to help GCEA. It’s in their interest to conserve energy because it’s less expensive than building new coal power plants," Driver says.
Driver says the rate increases show the "merit in energy efficiency investments so we can all use less and save money."
GCEA board member Lou Costello says it will take a major lifestyle change across America before the price of electricity drops. "We’ve all got to make huge changes in our lives in how we think about energy. To me it includes a change in the house I live in—going from a big house to a little one with much more passive solar design and energy efficiency," Costello says.
Morgan agrees and says, "People will have to dramatically shed the amount of energy they use before we can level off. Right now our society does not accept that radical of a lifestyle change."
He adds, "I think technology is the main thing that will change our ability to reduce energy use without reducing our quality of life, as it becomes more cost-effective and viable."
For more information on ways to conserve energy, contact the Office for Resource Efficiency at (970) 349-9673. For additional ways to save money on your energy bill call GCEA at (970) 641-3520.

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