SAFETY

Everything we do at Southern Indiana Power must begin with a focus on safety. I am pleased to report that the cooperative did not experience a serious accident or injury in 2024. Since 2008, the cooperative has been recognized for attaining the NRECA national standard of safety achievement. I congratulate all employees on this accomplishment and their continued dedication to safety.

ANNUAL MEETING, MEMBER PARTICIPATION, AND MEMBER APPRECIATION

The main purpose of the cooperatives Annual Meeting is to hold elections for the board of directors and share financial information. In 2020, we reverted back to a business-style meeting and began to allow mail-in registration and voting. The goals were to increase member participation and control costs. Member participation has risen dramatically from an average of 550 members to an average of 2,000 members. The cost of putting on our Annual Meeting has decreased significantly, saving money for all members.

I would like to thank all members for their increased participation.

This past summer, we celebrated our 85th anniversary by hosting a member appreciation day. Our Brats and Kilowatts event included a lunch, equipment demonstrations, a live line demonstration, and t-shirts for the first 200 attendees. Thanks to everyone who stopped by to celebrate with us.

CAPITAL CREDITS

As a cooperative, we operate at cost, so any profit generated at the end of the year is assigned back to you in the form of capital credits.

Over time, these capital credits are paid back to members. In 2024, we paid back just over $500,000 in capital credits to members who received electric service in 1999.

This year, your board of directors voted to pay back approximately $500,000 in capital credits for the year 2000. All active members who had electric service in 2000 will receive their capital credit distribution in November.

Since 2012, the co-op has paid back over $8.3 million in capital credits to our member-owners.

WORK PLAN AND RELIABILITY

One of the cooperatives main goals is to provide reliable power to all members. Maintaining an electric distribution system of nearly 1,700 miles is a year-round process.

In 2023, we began our new work plan, which includes investing over $16 million in our electric plant over the next four years. This includes new services to approximately 600 new members, 23 miles of 3-phase line extensions, 1,200 pole changes, and approximately 40 miles of 1-phase line rebuilds.

In 2024, we completed an 8-mile, 3-phase upgrade project across Apalona Road in Perry County. This project will increase reliability for members served from the Bristow and Bandon substations.

We are also continuing our aggressive right-of-way maintenance program with the same goal of minimizing service interruptions. An additional crew was added in 2022 to help reduce our overall trim cycle, which is the time it takes to move all the way around our electric system. This year, our focus will be on our Bristow substation in Perry County.

ELECTRIC RATES

Here at Southern Indiana Power, we strive to keep your rates as low as possible.

In 2022, we began seeing significant cost increases, which caused rates to rise 10% for our average member. We were facing cost pressures on both the wholesale and distribution sides of the business.

On the wholesale side of the business, Hoosier Energy was experiencing skyrocketing natural gas, coal, and energy market prices. These commodities have been very volatile due to rising demand and our nations inability to increase supply. Wholesale costs hovered around $70 per megawatt hour, then soared over $80 per megawatt hour. On the businesss distribution side, we saw major increases in material costs for poles, transformers, wire, and fuel.

For 2024, I am pleased to report that both wholesale and distribution costs have stabilized. This occurred due to increased natural gas supply and shoring up the supply chain issues for electric distribution materials. We were able to keep our rates in check, thankfully bringing an end to the previous few years of rate volatility.

Wholesale rate forecasts show slight decreases in power costs in the future. In fact, we passed on a 2% rate decrease back in January of this year. This is occurring as neighboring utility providers are raising their rates significantly. As we move into the future, we hope to continue providing members with the electric rate stability you have grown accustomed to.

OPERATION ROUND UP

In 2024, the Operation Round Up Board of Trustees awarded grants totaling nearly $30,000 to help fund much-needed community projects and scholarships. By members simply agreeing to round up their electric bill to the next dollar, the Operation Round Up program has been able to fund projects totaling over $600,000 since its inception in 2006. Thanks to all our members who participate and make this program such a huge success. I would like to give a special thank you to our Operation Round Up Board of Trustees Paul Malone, Michelle Lynch, Randy Kleaving, Amy Ramsey, Roger Hurm, Ed Denning, and Gary Waninger.

SOUTHERN-PSC FIBER PARTNERSHIP

Southern Indiana Power (Southern) and PSC Fiber (PSC) formed a partnership in 2019 to bring fiber-optic high-speed internet to all members. Approximately 4,000 members, nearly 50% of our electric service territory, lacked access to a high-speed internet connection.

Engineering estimates to build fiber to these areas were approximately $24 million. We were fortunate to receive a $6.5 million grant from the state of Indiana. Also, Spencer County committed an additional $3 million in matching funds toward our territories in that area. Rounding out the funding for our project, Southern secured a $15 million RUS loan.

In the agreement, Southern owns the fiber, and PSC owns the electronics. PSC leases the fiber from Southern and provides all services to the customers. This is a unique and great partnership with two like-minded cooperatives coming together to provide an essential need in the communities we serve.

I am excited to report that the mainline construction phase of the project is complete, and all Southern members now have access to fiber! Members who have not yet taken the opportunity to sign up can do so anytime by calling PSC or visiting pscfiber.net. To date, we have connected over 2000 members to fiber.

I am so proud of our partnership with PSC, and I am excited for all Southern members to get connected to this world-class internet connection.

Meet your 2025 elected directors