Message from Acting CEO Bryant Robbins about United Power’s Fight for Competitively Priced Power for our Members
Dear Co-op Members,
You may have noticed United Power’s name in the news more recently than you have in the past, and for good reason. As your electric cooperative, we here at United Power believe in putting our members first in everything we do. Fighting for your right to purchase electricity to energize your homes and businesses is no exception. Our cooperative was formed through the hard work and diligent efforts of local farmers, business owners, and homeowners who believed they had the right to electricity as much as anyone else. 80 years later, we still couldn’t agree more. Now we are fighting a battle not to simply provide electricity to our members, but to do so at a fair price.
For almost 70 years, United Power has worked closely with our power supplier, Tri-State Generation and Transmission, to ensure that you have safe, reliable, and affordable energy at your fingertips whenever you need it. Unfortunately, we have had increasing tensions with Tri-State these past several years as they have not been able to provide wholesale power at competitive rates. Comparison to other power providers reveals Tri-State’s rates are as much as 30% higher than their competitors. United Power has a duty to explore our options and an obligation to pursue the path that is most advantageous to our members, even when that path isn’t easy.
To that end, United Power asked Tri-State in June of 2018 if they would consider converting to a partial requirements contract. Currently, Tri-State supplies United Power with substantially all its energy needs under what is referred to as a full requirements contract. Giving United Power the ability to blend a mix of power from other, less costly providers while continuing to purchase the higher priced power from Tri-State would have allowed us to decrease the overall cost of power to our members with as little disruption to all parties involved as possible.
The request for a compromise was denied and so, with little other choice, United Power requested a buyout number from Tri-State in August of 2018. The response we received a short time later was an amount that could only be described as outrageous. Regardless, United Power continued to work within Tri-State’s sluggish committee structure seeking relief for our pricing frustrations. A year later, having had no satisfaction or resolution to our concerns, United Power initiated the process to explore other alternatives. After receiving indicative pricing from numerous power suppliers, it was clear to the Board and the management team at United Power that there was no choice but to pursue relief with a higher authority.
In November of 2019, we filed a complaint with the Colorado Public Utilities Commission (PUC) seeking a fair buyout charge. With similar concerns, another Colorado cooperative filed a comparable claim and the PUC combined the matters. This summer, we received a favorable ruling from the Administrative Law Judge (ALJ) assigned by the PUC to hear our case. Both cooperatives submitted proposed methodologies for determining a buyout number. The ALJ selected United Power’s methodology as the most reasonable, just, and non-discriminatory.
Tri-State has tried to circumvent the PUC, primarily by seeking jurisdiction under the Federal Energy Regulatory Commission (FERC). Again, in an effort to protect our members from Tri-State’s self-preserving tactics, United Power sought the assistance of a higher power. In May of 2020, we filed a case with the Adams County District Court alleging that Tri-State had recruited three non-utility entities with the sole purpose of gaining FERC oversight and thereby eluding the jurisdictional control of the PUC. We believe this was a conspiracy to defraud United Power and an attempt to hold us captive in an expensive and restrictive power contract. Court documents outline how the years-long scheme intentionally misled Tri-State’s members and ultimately caused financial harm to United Power and the more than 95,000 members we serve.
On August 28th, FERC reversed an earlier decision and determined they have sole jurisdiction over the exit fee matter. United Power remains hopeful that the PUC and Adams County District Court will provide relief in the form of invalidating the addition of the three non-utility members and thereby eliminate FERC’s jurisdiction over Tri-State. This would place control back in the hands of the PUC who, along with United Power, has invested countless hours in contemplating the matter of determining a reasonable, just, and non-discriminatory exit fee.
I think it’s important that I share the background and details of this battle with you, our members, so that you can hear directly from your cooperative what we are doing and why. Once we secure a reasonable exit charge from Tri-State, our Board can determine the appropriate action to take to save you money on your electric bill. If we are successful in our efforts, we estimate that we can reduce your retail electric rates by 15%-25%. We believe you’ll agree, that’s not insignificant.
We continue to hope for a resolution with Tri-State that benefits all parties and reduces costs for United Power members. I will continue to provide updates through our newsletter and this web page.
Acting Chief Executive Officer