Last month, we looked at the factors that influence your monthly electric bill. This month, I want to take that conversation one step further and explain how your electric rates are determined and why they are structured the way they are.

As a member-owned cooperative, Decatur County REMC does not set rates to maximize profits. Our rates are designed to recover the cost of providing safe, reliable electric service while ensuring those costs are shared fairly among our members.

An important part of that process is a Cost of Service Study, or COSS. This study evaluates the costs of serving different types of members, including residential, commercial, and industrial accounts. Because each member class uses the electric system differently, the cost to serve them can vary. A COSS helps us develop rates that reflect those differences and ensures one group of members is not unfairly subsidizing another.

Our board of directors, elected by the membership, provides oversight and approves changes to electric rates. Their responsibility is to balance affordability today with the financial strength and system investments needed for tomorrow.

It’s also important to distinguish between base rates and power cost adjustments. Base rates are established to recover the cooperative’s ongoing costs of providing electric service. Power cost adjustments can fluctuate based on changing costs, particularly the cost of purchased power. Your individual bill can also change based on how much electricity you use. So, an increase in a monthly bill does not necessarily mean our base rates have increased.

In fact, Decatur County REMC has not implemented a base rate increase since 2019. Through careful financial planning, cost management, and responsible investment, we’ve worked to maintain stable base rates while continuing to strengthen our electric system.

Fairness in rates also extends to members with solar generation. While solar may reduce the amount of electricity a member purchases at certain times, those members still rely on the electric grid when their system is not producing enough energy. Solar rates are structured to account for energy received from and supplied to the grid while ensuring the costs of maintaining a reliable electric system are shared appropriately.

At the same time, we’ve continued investing in reliability through infrastructure improvements, smart grid technology, vegetation management, and proactive equipment replacement. These investments help reduce outages, improve response, and control costs over the long term.

Keeping rates affordable while maintaining a reliable electric system requires thoughtful planning and responsible financial stewardship. It’s a balance we take seriously because every dollar we manage belongs to the members we serve.

Our commitment remains simple: providing safe, reliable, affordable, and friendly service today while preparing our system for the future.