In December of 2023, we informed our members via the Kansas Country Living magazine that Bluestem was undergoing a Rate Study. The Bluestem Electric Board of Trustees authorized a revenue requirement and cost-of-service study to consider the need for a future rate increase. Power Systems Engineering, an independent rate consulting firm, was contracted to perform both studies.
The rate study has several stages:
1 Revenue Requirement: Calculate the revenue needed to operate the business successfully in the future.
2 Cost of Service Study: Identify the portion each rate class is responsible for in the suggested revenue requirement.
3 Rate Design: Design rates so that revenue is collected fairly in each rate class, while also meeting any other goals identified by the board.
Have you ever wondered how the rates you pay for electric service are established? All operations of an electric cooperative are funded through the rates paid by the members. As a not-for-profit member owned business serving your local communities, Bluestem Electric Cooperative has two primary obligations. First is to provide safe, reliable and affordable service to the members. The second is to maintain sound financial operations that satisfy the requirements of our lenders. Our member-elected board of trustees and the cooperative’s management must examine rates periodically to ensure they continue to fulfill these obligations, while keeping rates fair and reasonable for the members.
For this reason, Bluestem Electric Cooperative is currently undergoing a rate study process to fulfill this responsibility. Cooperatives use independent rate consultants to ensure the process is completed without bias. We have retained the services of Power System Engineering, Inc. to conduct our rate analysis using industry-accepted standards.
When the rate study is completed, it will be reviewed by the board in detail. The board takes its responsibility to set fair rates very seriously. After all, they are members of the cooperative and pay the same rates.
After the board’s review, they will determine if there needs to be a discussion and vote on any potential rate changes. Kansas law requires that we provide the membership with notice of the time and place of any meeting of the board of trustees, where rate changes will be discussed and voted on.
Rate change meeting notices will include as many details as possible about any proposed changes. Members will have the opportunity to attend the board meeting to hear the discussion and vote of the board, and express opinions on the changes. Members can find the notice for these meetings in the Kansas Country Living centerspread.