CVEA Board Approves Proposed Rate Changes
Proposed rate changes to the CVEA Tariff were unanimously approved by the Board of Directors at the regular meeting on Thursday, August 15, 2019. The rate changes come at the conclusion of a year-long rate study where an estimated annual revenue shortfall in the amount of $756,000 was identified.Members can access a copy of the presentation and a Youtube recording of the entire public meeting below.
A plan to recover the shortfall was presented to the membership through various media outlets and a public meeting was held in both districts on Tuesday, July 23.
- The monthly customer charge for residential members, which hasn’t increased since the 1990s, will increase from $12 to $20 and small commercial members will increase from $20 to $30. This component will recover $359,000 annually.
- The percentage of heat revenue given back to the members as a credit on the bill when running the Cogen Plant and selling heat to Petro Star will be reduced from 90 percent of the total to 80 percent. This will recover an estimated $283,000.
- Further reductions to the 2020 budget will make up the final $123,000.
According to Jaime Matthews, CVEA Chief Financial Officer, “Cutting the budget to recover shortfalls is always a consideration. CVEA has made significant cuts over the last five years to include the elimination of two upper level management positions and a revamped, more efficient fleet program. However, the Co-op is not able to recover the shortfall with budget cuts alone and still maintain a reliable system.”
It is important to note that each customer is different based on their usage, but the impact of the changes to an average residential member (one who uses 500/kWh/month) will be approximately $114/year. Small commercial members will notice an increase of an estimated $163/year.
Approved changes will be effective September 1, and members will see the changes on the September billing.
If you would like additional information or have questions, please contact Jaime Matthews, Chief Financial Officer, CVEA, PO Box 45, Glennallen, AK 99588, phone: (907) 822-3211, (907) 835-4301 or by email: Matthews@cvea.org.