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Craighead Electric Cooperative Corporation (CECC) strives to provide our members with safe, reliable and affordable electricity. The co-op’s rates have remained steady for more than a decade, but recent challenges affecting CECC’s financial condition, including increased operating costs, plant growth due to increased electricity sales and inflation at large, have necessitated a change in electric rates.

Following industry best practices, the cooperative commissioned an engineering consulting firm (Toth & Associates) to review current rates and determine if they are producing sufficient revenue. This is known as a cost-of-service study.

As CECC operates as a not-for-profit cooperative, we must generate operating margins to cover capital credit retirements to members, operating costs and principal on long-term debt while maintaining sufficient equity.

The independent analysis determined CECC needs to increase our retail rates, which have not changed since May 2010. The CECC Board of Directors reviewed the cost-of-service study and, upon cooperative staff’s recommendation, voted in favor of a rate adjustment to increase system revenue by 9.3%. Note: The expenses and revenue of empower, Delivered by Craighead Electric (a wholly owned broadband subsidiary) are separate from CECC and did not influence the cost-of-service study or the decision to propose new rates.

CECC will submit the rate adjustment request to the Arkansas Public Service Commission in July. If approved, it will go into effect with usage beginning Oct. 1, 2022. The 9.3% reflects the average increase across all rate classes — residential, commercial and lighting, including an increase in the service availability charge. In addition, CECC plans to rebase the cost of energy and cost of debt adjustment revenues into the new kWh rates. These charges are reflected as either debits or credits on members’ statements each month.

If implemented, these rates will impact members in different ways, depending on their lifestyle and situation. The largest impact to a typical residential account will be in the service availability charge. For example, a typical bill for a residential member with one meter using 1,000 kWh a month would go from $112.45 to $126.58. The service availability charge helps cover fixed costs, such as meters, transformers and lines necessary to provide electricity to a service regardless of its usage. It is often referred to as a minimum bill.