BillingGazette

Published on Wednesday, April 08, 2009.
Last modified on 4/8/2009 at 12:38 am

Power co-op in 10-year electricity deal

By LINDA HALSTEAD-ACHARYA
Of The Gazette Staff

COLUMBUS - Beartooth Electric Co-op, as a member of Southern Montana Electric, recently contracted with PPL Montana for electricity for the next 10 years, according to a Beartooth official.

 

John Prinkki, president of the board of Beartooth Electric Cooperative and vice president of Southern, said Tuesday evening that PPL offered "very surprising, very acceptable" rates to the group of co-ops that make up Southern Montana.

 

The contract, however, does not necessarily mean plans for a coal-fired or gas-fired Highwood Generation Station have been abandoned, he told a crowd of Beartooth members at an informational meeting in Columbus.

 

"Southern is still evaluating options for its long-term power supply," he said. ""The contract is only for 10 years."

 

Prinkki declined to state the exact rate offered by PPL, but said it was in the "mid 5-cent range," which would put it roughly 2 cents more per kilowatt-hour than the current rate, but "considerably less than expected," he said.

 

But co-op members seemed less interested in the contract than the events leading up to it. They questioned Prinkki about the formation of Southern and why Beartooth had invested more than $5 million in a project that had no confirmed financial backing.

 

Prinkki countered that the Rural Electric Service had told Southern to expect funding in early 2008 and withdrew its support for coal-fired plants only in the wake of a lawsuit from the Sierra Club. "We were nearly there," he said.

 

The topic of rate disparity prompted several questions. Prinkki explained that Electric City Power of Great Falls, the only "non-co-op" member of Southern, had been paying higher rates than the other members of Southern but was recently offered a new blended rate that would eventually equalize rates among all of Southern's members.

 

The city adopted its new lower rate at the same time Beartooth members saw their bills increase by double digits.

 

"(Electric City Power's) power supply costs essentially flat-lined," Prinkki explained. "Ours (rate) is lower than theirs, but in a few years, ours is higher than theirs."

 

So why did Southern seek Electric City Power's membership? "There were a lot of good business reasons," Prinkki said, listing its location and its water rights, among others.

 

Co-op members also questioned why Beartooth's Wyoming members pay lower rates than their Montana counterparts. Prinkki detailed the ins and outs of Wyoming's legislative decisions and the fact that certain co-ops in Wyoming fall under the jurisdiction of the Public Service Commission.

 

But Deb Thomas, a Wyoming member of Beartooth, traced the disparity to poor management on the part of Beartooth.

 

"It is a sad situation when co-op members are pitted against other co-op members when it comes back to management," she said.

 

Prinkki admitted failings of past management and pointed out that Beartooth had recently hired Ron Roodell as general manager.

 

Roodell spoke of a new approach at Beartooth, which he hopes to launch with a survey of members. He listed several ideas for promoting conservation, transparency and education. In the past month, the co-operative introduced a "Green Power" program whereby members can, for an additional 1.5 cents per kilowatt-hour, purchase energy from renewable sources.