As we approach the fall season, which is always bustling with school, community, and sports activities, it’s also the time of year when we start focusing on next year’s budget and rates.
Unfortunately, I must inform you that our wholesale power supplier, Basin Electric Power Cooperative (Basin), recently announced a substantial rate increase effective January 2026. This means that rate pressure will continue into 2026.
I understand the impact of these rate increases on you, our valued members. As a result, East River Electric and Southeastern Electric have been advocating on your behalf, leading to Basin proposing to phase in the necessary rate increase over two years (2026 and 2027) instead of all at once.
We’re also not alone in this challenge. Nationally, wholesale power costs are increasing significantly as demand for electricity rises faster than new electric generation (supply) can be built. This is why Basin recently announced over the next 10 years that they will need to invest over $10 billion to meet the growing demand for electricity. This doesn’t even include investments needed to serve extremely large loads like data centers, which will be required to self-fund most of the costs to meet their energy needs through a new, innovative rate specifically for these large loads.
Other key factors impacting Basin’s wholesale power cost increases include:
• Additional reserve capacity required by electric grid operators like the Southwest Power Pool (SPP) to ensure adequate generation and transmission infrastructure is available to reliably serve members during peak energy use periods.
• Forecasted losses at Dakota Gasification Company, a Basin Electric subsidiary company, due to lower natural gas, fertilizer, and other commodity prices.
• Continued impacts from a period of high inflation.
Since wholesale power purchases represent 68% of Southeastern’s annual operating expenses, we will also need to increase our rates in early 2026.
As we navigate these challenging times though, I want to assure you that Southeastern is committed to transparency and minimizing the impact of rate increases on our members. We will continue to advocate on your behalf and explore every opportunity to mitigate these costs. Our goal remains to provide you with safe, reliable, and efficient energy services at the best possible value. Thank you for your understanding and continued support as we work together to meet the energy needs of our members and communities.