Decatur County REMC held its annual meeting of the membership on June 14 at the Decatur County Fairgrounds. It was so fun to see so many of you. We had a great time visiting, eating Chick-fil-A and ice cream, being entertained by some wonderful piano music, and learning more about our cooperative.
In case you weren’t able to make the meeting, I’ll share what you missed.
Our theme this year was “Powering Our Future.” Through recent strategic planning, it is clear that we are focused on powering the future of DCREMC, the communities we serve, and your lives.
I shared some updates on completed projects and implemented strategy. As you know, last year, for the first time ever, we offered early voting options by mail and online for your board of directors and nominating committee. You asked for it,we made it happen, and it was a big success.
In the first year of offering early voting, we more than doubled our participation in the election with a 217% increase. Numbers from this year’s election were even greater. We set a record number of submitted ballots in 2019 with a total of 1,646. Given the increase in engagement, we will continue to offer early voting options. Our ultimate goal would be to have 100% participation by members. Your engagement and participation will help power our future.
We also made a commitment to increase our communication with members. We’ve demonstrated transparency through our member connect meetings. At these meetings, I have personally met with hundreds of members either at their homes, at their farms, or in their offices to hear concerns, listen, gather ideas and work together to take advantage of opportunities to move our cooperative forward. We hosted town hall meetings and rate education sessions, and we continue to share information through our Facebook page and Indiana Connection magazine.
I shared an overview of our 2018 financial information that was provided in the annual report you received in May. Purchased power makes up the largest portion of our cost at 76%. The statement of operations for 2018 shows operating margins of $250,000. Our margins are used for the following: cash reserves, infrastructure investments, capital credit retirements and principal payments on long term debt. We had a 3.5 percent increase in kilowatt-hour (kWh) sales and set a new peak demand in January 2018 of 72,777 kilowatts. I also highlighted our equity as a percentage of total assets is 62% compared to the U.S. median of 45.39% (in which there are 596 other electric distribution cooperatives across the US).
In conjunction with the financial update, I shared some communication points I believe are important for you to know and understand. We have continued to communicate information about our aggressive right-of-way program. While it accounts for a significant portion of the budget, it is imperative to improving reliability, long-term cost and our service to you, which helps power your future.
From 2016-18 we cleared 551.61 miles of line, which is just less than half of our system — spending $3.7 million to do so. Since 2016, we have completed 740 tree tickets generated from member requests.
If you’ve been following us on Facebook, looking at your bill inserts, or reading Indiana Connection, you should know by now that for the past year we’ve been conducting an intensive rate study using our own unique member data. As we considered what we wanted to achieve in the next few years, our main goals were to continue our commitment to reliability and dollars designated to the right-of-way clearing program. The data from the cost of service study also revealed that we needed to realign our rate class margins to reflect the cost to serve each class fairly.
The newly implemented rate change enables us to move forward in powering our future. DCREMC experienced its last rate change in 2014. Those rates were designed to last three years, so we have been able to control costs in order to extend the life of those previous rates. We continue to work efficiently and are diligent in controlling costs in every area of business to ensure we are providing the most cost effective, yet most reliable service to you.
I also shared information about an important tool for you to access as a member — SmartHub. There are so many helpful features and options through SmartHub that will help you manage your account and will transform your interaction and understanding of your electric use.
Every member can sign up for SmartHub using an email address. With that, you are able to check your daily or hourly electric use. This helps you to understand how you are using electricity and to consider ways you can cut back, or identify trends that can help you manage your daily electric use.
You can also pay your bill online through SmartHub. This feature allows you to pay at your convenience, and on your own time. We always welcome members to stop in the office, call us 24/7, or utilize the night deposit box to pay your bill. We understand how busy life can be, so we offer this easy, convenient option to fit your lifestyle.
As I mentioned, last year we kicked off a strategic planning process that included several activities. First, our entire team of employees and board members participated in a series of surveys and discussions focused on our future direction. Next, the board and leadership team conducted a strategic planning session to identify our key areas of focus and strategic initiatives. We believe that these initiatives will help to power our future:
• Operational excellence — We are creating an operating mechanism to guide our work and resources (data driven plan, prioritize and allocate resources). This initiative also includes continuous improvement events for some of our current processes.
• Employee excellence — Invest in developing and maintaining a high performing workforce
• Member engagement — Reaching members to share, learn from, and educate as needs and expectations evolve
• Strategic combinations — Another way of saying we are focusing on sustainability and potential partnerships to meet evolving consumer needs and expectations
• Board accountability — Elected by the membership, the board is committed to increasing its level of education as well as ensuring that decisions are made in the best interest of the entire membership
All of our employees have participated in developing action plans, projects, and metrics to drive these initiatives. We’ve spent time analyzing and ranking projects in terms of priority, feasibility, and impact and will keep you updated on developments through our normal communication channels like Indiana Connection, Facebook, and our website.
Another long-term strategy that we’re currently focused on is our infrastructure investment strategy. The increase in margins from our new rates will help us make infrastructure improvements to address our aging system and peak demand growth. Our system has over 23,600 poles throughout our service territory. However, our poles are aging and we need to replace more and more each year. We initiated a nine-year pole inspection cycle in 2016, and have completed inspections on 30% of the total system poles. We have a backlog of 267 rejected poles needing to be replaced so we developed a strategy and the board approved a budget this year to include the replacement of all 267 poles.
Additionally, we have finalized our latest construction work plan, which will guide our system projects for the next six years. This plan includes fuse coordination projects that will optimize the placement of fuses and ties throughout our system so that we are able to isolate sections of line to minimize the number of members who lose power during an outage. This, and our other construction work plan projects, are all focused on improving our system reliability and service to you.
We are also making a number of IT investments to position us for the future. Our lifecycle management strategy allows us to reduce long-term cost and mediate downtown. I also shared that we take the security of member information and data very seriously, and we continue to invest in technology and systems that will protect your information.
In looking even further down the road, I highlighted a couple other future project updates. We are having conversations with community partners and key stakeholders about how DCREMC can support broadband initiatives in our area and have created a board committee to strategically consider electric vehicle transformation.
This is an exciting time for electric cooperatives as needs, technology, and resources are changing. We look forward to working together to power our future.