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MESSAGE FROM THE GENERAL MANAGER
Power Supply and Retail Rates
As you may know, we are served wholesale power over an integrated system by the Bonneville Power Administration (BPA). Although wind, solar, and nuclear power are included, almost all the power generated by BPA is in the form of low-cost renewable hydropower. We have an all-requirements contract with BPA through 2028. We are currently working on the next contract with our advocacy groups and BPA now. We are expecting to execute the next contract sometime in 2025. At this point, it appears that our next contract will be somewhat like the existing contract with tiered rates, with emphasis on energy efficiency and conservation and continued expenditures for fish and other environmental mitigation concerning the rivers and the hydro-electric dams. We have had a several-decades long partnership relationship with BPA, and we need to do what we can to make sure that continues. Our wholesale rates are some of the lowest in the country, and we work very hard in conjunction with BPA to keep it that way.
Of the $15.87 million in operating revenue, 69% was received from residential accounts, 26% came from irrigation services, and the remaining 5% came from commercial accounts and other small miscellaneous revenues. Slightly more than 50% of our total revenue is used for the wholesale cost of power. We are expecting a significant increase in our market-based, Tier 2 wholesale power effective October 1st of this year. It is early, but indications are that we will need to raise retail rates effective January 1, 2024, to make up for this additional cost. Even after this proposed rate increase, we are still expecting to have the lowest rates in the state.
Read the latest news from Vigilante Electric and the Montana Electric Cooperative Association