Manager Connection: Full System Rate Increase 2026

General Manager Syd Briggs

As most of our members know, Steele-Waseca has not had a full system rate increase since 2013. We have been slowly adjusting the rates of the former Alliant members we acquired through SMEC over the past 10 years to get close to our legacy rates and will finally accomplish that this year. We do pass on increases in the Cost of Power to our members through the WMA, or Wholesale Market Adjustment, and our last adjustment was in 2025, although it has not been needed every year. This year we expect an increase of 2.1% in Cost of Power, and we finally need a system wide increase in addition to the Cost of Power increase to pay for increases we have experienced over the last 13 years in Cost of Service. Steele-Waseca’s cost of power from GRE made up 71% of our total cost in 2025 with our operations and maintenance, depreciation, and interest on long term debt making up the majority of the remaining 29%. It has been a good 13 years with the Board and employees making decisions that have benefited and delayed the need for an increase in rates for the entire system, along with experiencing some growth in energy sales.

As successful as your cooperative is at reducing costs without reducing service (we have been having excellent years with very low instances of outages), we have come to a time of a necessary increase in our rates. In January, the Board of Directors reviewed a Cost of Service Study performed by our consultant and agreed with the recommendation of management and the consultant to increase rates an average of 2.5%. We are very pleased that it has been 13 years since there was this type of increase, and many other utilities have been experiencing much larger and frequent increases. Your Board of Directors and employees have been working very hard year after year to minimize expenses without sacrificing service and the results have been excellent. Our expenses, other than cost of power, have averaged only a 4.1% increase each year for the past 2 years while our energy sales have averaged an increase of 1.2% during the same period. We can operate with that difference for a short time (in this case 2 years) but eventually we must increase rates to match our increase in expenses.

Since it is important for each member to be able to plan and budget for the upcoming year, I want to provide the following analysis on the rate change for our residential members:

There will be an increase in the monthly charge to $30.
There will be an average of 4.3% increase, or $7/month, on the average residential account. Since there was an additional increase with some accounts being adjusted to our normal residential rate there is a wide range of differences based on the rate and usage our members experience.
We expect 90% of our members will fall in the range of a 2% – 5% increase depending on their rate adjustment and their usage, however some may experience a much larger percent increase. Most will be under a 20% increase as we complete the adjustment to our legacy rates.
To help prepare for the new rates the next page in Sparks has a list of all our rates with the present and new rates. The information will also be available on our website.

It is important for our rates to collect as much of the actual costs as is applicable. Even at $30.00 per month, we must collect most of our costs of service through our energy charge. This structure of a higher monthly charge will help collect a fairer amount from each member rather than collecting most of our needed revenue just from those members that use energy. We will continue to work hard to provide the best service and realize cost savings whenever possible. We also have an excellent section on our webpage (www.swce.coop) titled “Rebates and Programs” that provides many ideas about not only rebates, but also efficiency and conservation. For most members the rate change is not a large one, and as it will take effect on your March 20^th bill, please feel free to call any of our member service representatives if you have a question or need further clarification.

Trust

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