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Jul 18, 2018

Petit Jean Electric Cooperative Corporation proposes rate changes

Petit Jean Electric Cooperative Corporation is your local member-owned electric energy provider. The Cooperative’s purpose is not to make profits for shareholders but to provide you, the member-owners, with the most reliable electric service at the lowest cost possible. A rate adjustment is not a decision that your Board of Directors takes lightly. Because sales have been flat and the costs of doing business have risen, a comprehensive study and rate analysis was recently completed which indicated an average 5.7 percent rate increase is necessary. Petit Jean Electric has proposed rate changes to the Arkansas Public Service Commission. If approved, the new rates would become effective with October 2018 billing statements.

There are two primary cost components in providing electric service: Wholesale power costs and distribution costs.  Wholesale power is the electricity that the Cooperative must purchase from our power generation supplier, which is then transmitted to Petit Jean Electric substations. Distribution costs are the expenses incurred in delivering the electricity from the substations to you, the end-user. Distribution costs include such things as the materials to build and replace lines, poles, wire and transformers. These costs also include maintenance items such as right-of-way tree trimming, substation equipment, storm restoration and operational upgrades associated with providing you dependable power. Distribution costs are somewhat fixed and must be paid whether or not we sell any kilowatt-hours. The proposed rate adjustment is required to compensate for these rising costs. Petit Jean Electric has not had a rate increase to offset distribution costs since 2012. Needless to say, most everything is more expensive now than it was over five years ago.

Since 1940, Petit Jean Electric has been providing power to members throughout nine counties in North Central Arkansas. We serve 19,949 accounts with 3,585 miles of line. We strive to provide reliable, affordable and responsible power to our membership. Like most rural electric cooperatives, we have the disadvantage of a low account density contrasted with the many miles of line we serve. Even with this challenge, your cooperative has kept competitive rates at or below the Arkansas cooperative average and about 20 percent lower than the national average for electricity. This
will still be the case even with the proposed rate change.

The principle on which Petit Jean Electric was founded – to serve our local communities with reliable power at the lowest possible costs – is just as strong today as it was when we opened our doors over 78 years ago. The Board of Directors and employees of Petit Jean Electric are committed to diligently serving our members. As members, you do more than trust us to provide the energy you need – you count on us.

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