SBEC Maneuvers
Through Atypical Year
Message from President/General Manager, Billy Marricle
August 2021
FIRST AND FORMOST, I would like to thank all the members who connected with San Bernard Electric Cooperative by participating in our first ever (and hopefully last) drive-thru annual meeting. I was astonished by the sheer number of you that showed up. In fact, we had more members registering at this meeting than any other meeting before.
I think a lot of it had to do with the fact that we had a contested election for District 8. Colt Haack retained his seat and will serve the two years remaining on his term. Another reason for such a large turnout might be the fact that we were not able to have an annual meeting last year due to the COVID-19 pandemic. Regardless of the reason, I want to say ”thank you” to all who participated.
When I say “hopefully last,” it’s only because the logistics of putting on this type of an event were far more onerous than that of a normal annual meeting. We utilized more employees and dealt with traffic flow issues that we normally don’t have to consider. Besides, many of you commented that you missed the barbecue; well, I missed it too!
SBEC officially became a member of South Texas Electric Cooperative by its board’s approval June 24. We are excited about joining this organization. STEC is a generation and transmission cooperative owned by its members—much like your membership at SBEC means you own a part of this cooperative.
As an SBEC member, you will not see any changes to how we operate. We will still be the provider of the electricity you utilize, and you will still get the same service you have come to expect from us. The difference is, as of July, all our wholesale power will be supplied by STEC.
This is huge for the fact that after the winter storm, our rates were anticipated to be higher. If you remember, SBEC raised rates by $6 per 1,000 kilowatt-hours. This increase was put into place just to start collecting on the winter event. We knew our rates would be affected, and this is where we started. Sadly, this rate increase did not cover the full increase needed. However, with our joining STEC, we anticipate that little or no increase will now be needed to recover the costs above the aforementioned $6 per 1,000 kWh.
When we first started exploring the move to STEC, it was in hopes of lowering our generation and trans-mission rates, but we were sidelined by the cost of the storm. I only wish that we could have completed this move to join STEC prior to the storm. STEC was one of the few utilities that didn’t suffer the high cost of the storm, thus its members’ rates remained virtually unaffected. Had the move been in place in February, our membership would have been better off. I will say that we (SBEC and STEC) worked feverishly to make this happen as soon as possible, but we did not make it prior to the storm.
I still cannot tell you exactly how the storm will affect rates because of several factors. The main factor we were waiting on is how the Texas Legislature will tackle this event. The only piece of legislation that came out of this year’s session was a bill concerning securitization. This bill allows electric cooperatives to borrow money by issuing bonds backed by the state’s assurance that the money will be collected to pay back the bonds. We are weighing the options of participating in this process versus utilizing our current lender.
Honestly, there are many variables to consider, and we will diligently do so. I promise that once I have all the variables sorted out and we come up with a plan, I will post updates through our social media channel. I’m even considering small community gatherings to unveil the plan and the reasons behind it. Just bear with me as we continue to gather and weigh all the information needed to decide the best way to proceed.
A lot of you commented on the Electric Reliability Council of Texas’ June call to conserve energy, and we all were startled by the call. After February, none of us wanted to go back into a load control event.
I can tell you that ERCOT experienced some shortfall in generation because a major power plant had an unscheduled interruption along with several plants that were still out for maintenance. Couple that with the fact that during this time there was no wind in far West Texas to help offset these offline plants. The need for this much power in early June rarely exceeds the peak we were experiencing at that time. I just hope that this will not be a recurring theme all summer long.
Until next time, take care.