Good evening and thank you for attending our 86th Annual Meeting. I am Mark McKinney, CEO of Jackson County REMC. Tonight, I want to provide you with an overview of 2023 and share some exciting updates for 2024.
ELECTRIC DIVISION HIGHLIGHTS
In April 2023, we adjusted our retail electric rates to align with the new wholesale power rates from our power supplier, Hoosier Energy. Throughout 2023, our wholesale power costs have averaged $90.84 per MWh. So far this year, our costs have remained relatively flat, averaging $90.94 per MWh. Based on the information shared at the July Hoosier Energy board meeting, we expect wholesale power costs to remain stable going forward. However, given the unpredictable nature of the global environment, nothing is guaranteed.
Along with the new wholesale power rates, the monthly Merom Stranded Cost Fixed Charge is an additional charge impacting our costs. This charge represents Hoosier Energy’s strategic shift away from coal, leaving $578 million in unrecovered plant investments at its coal-fired generation plant, Merom Station. Hoosier Energy’s 18-member cooperatives will recover these costs. Our portion of this obligation is $2.36 million per year through 2038. To recover this monthly fixed charge, we added a charge to your electric bill called the Merom Tracker. Members have asked about this charge, which is directly tied to recovering our share of the unrecovered plant investments. Ultimately, this move should result in more stable wholesale power costs, especially considering the new EPA rules on coal-fired generation that were recently published.
I am pleased to report that some of the inflationary pressures and supply chain challenges we have faced over the last few years are showing signs of easing up. While material and vehicle costs have not decreased, we are seeing more stable prices and improved lead times compared to a year ago.
Our primary challenge that remains is with bucket trucks and digger trucks. We use these trucks every day, and after 10 years of continuous service, it is time to replace them. The estimated cost for these trucks is anywhere between $350,000 to $450,000 each. Regarding lead times, we ordered a digger truck in 2021 and hope to receive it early next year. In 2022, we ordered two bucket trucks. The small bucket truck is expected by the end of this year, and the large bucket truck is expected by mid-2025. In the meantime, we have been able to keep the older trucks on the road.
Ensuring the safety and reliability of our electric distribution plant is important. In 2023, we spent $5.3 million on improvements, including replacing almost 1,000 poles and $3.5 million in right-of-way maintenance. To give you some perspective on the inflationary pressures on the right-of-way maintenance costs, pre-COVID, the cost for our right-of-way program was $2,650 per mile; today, the cost is $4,750 per mile. With nearly 3,000 miles of power lines and a rigorous four-year trimming cycle, this is a major operation managed by our employees. We know that proper maintenance directly contributes to minimizing the number of outages and their durations to provide the reliable electric service you deserve.
FIBER DIVISION HIGHLIGHTS
Since our first fiber-optic broadband connection in May 2018, our network now reaches 95% of our members. We have installed 2,200 miles of fiber-optic cable and are proud to serve nearly 13,000 broadband accounts with speeds ranging from 100 Mbps to 10,000 Mbps. In case you did not know, we also offer telephone service, and currently have over 400 telephone service subscribers.
Our fiber-optic broadband service is unmatched in speed and reliability, and fiber-optic technology is the most future-proof broadband technology available today. We stand by our commitment to transparency with no hidden fees, router rentals, managed Wi-Fi fees, support fees, or contracts for our members. The price we say is the price you pay. While our installation policy has changed, our prices have not changed since we started six years ago.
Our final construction of the fiber-optic mainline in Jennings County will begin next month. This will enable us to connect the remaining members to our fiber-optic high-speed network.
When we decided to build our fiber-optic network in 2017, most of you had no other options for a high-speed broadband connection. Our $130 million investment in designing, constructing, and operating your fiber-optic broadband network underscores our commitment to our membership. It is important to mention that no electric revenue was used to fund this major undertaking. We funded this project with loans, grants, and the revenues we have collected to date.
This fiber-optic network belongs to you, our valued members, echoing our cooperative ownership model. Many of our members have taken service, but if you have not, why not take service from your member-owned, not-for-profit, local electric and fiber-optic broadband provider, Jackson County REMC? Give us a call when you are ready to get connected.
JACKSON SOLUTIONS
Finally, starting this year, I am excited to introduce Jackson Solutions. Jackson Solutions was established to offer tailored products to our members. Today, we offer a generator transfer switch and a residential monitoring system.
The GenerLink generator transfer switch simplifies connecting a portable generator safely behind the electric meter, alleviating the need for an expensive transfer switch or wiring something up to your electric panel. The Honeywell residential security system provides professional 24/7 monitoring with customized packages like the “Protect Package” for comprehensive home security and monitoring and the “Medical Package” for specialized medical alert monitoring. The GenerLink and Honeywell systems are gaining popularity with our members as they realize these products’ benefits and cost savings. Please visit our website or call the office for more information.
In closing, I want you to know we have a great co-op. We are guided by a dedicated Board of Directors and a committed workforce. Everything we do focuses on our mission statement; “to deliver the advantages of electricity and essential services to our members reliably, economically, and responsibly.”
Thank you for your membership and thank you for attending tonight.
2024 ANNUAL MEETING RECAP
- Walter Hunter and Dave Hall were re-elected to another three-year term on the board.
- Ryan Fleenor was elected to District 5 following Jerry Kelly’s retirement.
- 686 members registered and voted online
- 710 members registered at the Annual Meeting
- 1,470 members and guests attended the Annual Meeting
- The business meeting had an estimated 250 people in attendance.
- The Kids’ Zone featured a tabletop live line safety demonstration and a bounce house.
NEW BOARD OFFICER POSITIONS:
Walter Hunter – President
John Miller – Vice President
Paul Elliott – Secretary/Treasurer
THANK YOU TO ALL OF OUR MEMBERS WHO ATTENDED!
