The turn of a year often brings with it new goals, new plans, and, in some cases, new challenges. The same can be said for the energy industry. It’s a dynamic, multifaceted system where technical, economic, and regulatory factors all intersect. As we embark on a new year, I want to outline some changes we expect to see in 2026.
As of January 1, Tri-State Generation and Transmission Association, our wholesale power supplier, implemented a 7.5% rate increase for its members — including Morgan County REA. Various factors have contributed to this increase, including major system investments, member departures, and complex regulatory requirements.
The cost of wholesale power is by far our largest expense, accounting for nearly 75% of our overall expenditures. As a not-for-profit electric cooperative, MCREA has no choice but to adjust rates in response to the increase. This is not a process we take lightly. Because MCREA is committed to keeping rates fair, transparent, and based on the actual cost of providing electricity to our members, we are conducting a Cost-of-Service Study.
This is a detailed, independent analysis used by electric cooperatives across the country to ensure rates are set responsibly.
Different types of members — residential, irrigation, commercial, and others — use electricity in different ways. Taking into consideration the rate increase from Tri-State, a COSS helps us determine the true cost to serve each class, making sure no group overpays or is subsidized. The COSS also identifies rates that reflect the actual costs of poles, wires, transformers, and system demand.
The results of the COSS will help MCREA adjust rates thoughtfully, rather than react blindly. It also enables us to prepare for the future, as electric cooperatives must plan years ahead. This study provides a solid roadmap to maintain strong financial ratios and continue investing in reliability and modern infrastructure.
It is also important to recognize that usage patterns evolve over time. Irrigation loads fluctuate. Homes incorporate new technologies. Businesses grow. The COSS reviews existing rate designs, assessing whether they still match today’s system realities — or if updates are needed in order to remain fair and cost-based.
As a member-owned cooperative, maintaining transparency with our members is of the utmost importance to us. We’ll be sure to clearly communicate the findings of this study and any resulting rate changes in a timely manner.
At MCREA, we are dedicated to delivering safe, reliable, and affordable electricity to over 5,000 members. This COSS will provide clear numbers and a detailed game plan for MCREA to achieve that mission.
