Reliability, rising costs and financial responsibility: Three reasons for our first energy rate change in ten years
By Tim Marienau, CEO

As demand for electricity continues to grow and the cost of generating power rises nationwide, utilities across the country are feeling the impact — and Prairie Energy Cooperative (PECO) is no exception. These broader industry pressures influence every part of our operations, from the wholesale power we purchase to the materials required to maintain and upgrade our system. While we’re proud we haven’t had a rate change in almost ten years, these increased costs place tremendous pressure on the cost of your electric service.

Basin Electric Power Cooperative, one of our wholesale power suppliers, will increase their rates by over 18% the next two years. Our other wholesale power supplier, Corn Belt Power Cooperative will also increase their rates to us by an average of 10% over the next three years. Wholesale power accounts for over 70% of our costs, so changes in wholesale rates have a significant impact on our operation. The remaining 30% of our costs are internal. Some of these are controllable, some are not. An example on uncontrollable would be such as how much electricity members use across our 11 county service territory use.  

In November, your board of directors approved a rate increase effective with the February 2026 billing cycles. Every rate class will experience an increase of about 10% for 2026. Prairie Energy returns any margins to its members, so there is no incentive to raise rates more than necessary.

As a not-for-profit electric cooperative owned by its members, Prairie Energy’s board of directors only increase rates when it must, to remain financially stable and to meet our lenders’ financial covenants. Your board of directors and employees take this responsibility seriously, as we too are members. One of the challenges we face as a rural electric cooperative is low density. We have roughly two (2) members per mile of line compared to investor-owned utilities with 28 consumers per miles of line and municipalities with around 58 consumers per mile of line. This is an enormous difference in terms of cost recovery. Simply put, we have fewer members and more miles of line. As a result, we have significantly fewer members from whom we recover our fixed costs.

I can assure you as a cooperative we will continue to look for ways to manage costs for our members, striving to provide value without sacrificing safety or reliability.

For more information about the new rates effective on the February bills, click here.