Eastern Illini Electric Cooperative’s (EIEC’s) mission is “to provide premium-quality, economically-priced electricity and other related services to our member/owners and communities.”
Note the focus on you, the member/owner, and the communities and areas in which we provide service. EIEC, as a member-owned cooperative, has a more than 75 year history of improving the quality of life for you – our member/owners.
We as consumers sometimes take electricity, and the conveniences it offers, for granted in this fast-paced, technologically driven world we live in. However, just a few generations ago, electricity to rural areas was a novelty. By forming cooperatives such as EIEC, and providing service to areas where for-profit companies would not, cooperatives have forged a strong bond with their member/owners. We are proud of this heritage and work hard to continue the tradition of service that defines us as a cooperative organization.
Electricity sales, and the associated revenues, were slightly above budget for the year. This was primarily due to higher than budgeted sales in the latter part of the year driven by grain drying load and a cold start to the winter season. This allowed us to meet our financial goals for the year.
Operating margins totaled $1.62 million on total operating revenues of $33.3 million. Since the margins were a bit higher than we anticipated, we were able to provide you, our member/owners, with bill credits totaling $500,000 in December. Equity for the year ended at 42.89 percent, which was slightly above our target value of 40 percent. That allowed us to maximize our interest rate discounts on our outstanding loans.
We’ve all seen advances in technology in recent years. Our industry is no exception. We now have an online outage map designed to give you a real-time idea of where – and how severe – outages are occurring. You can access the map by visiting our website at www.eiec.coop. We are also utilizing our Facebook page to provide you with interesting stories and timely updates.
You can view and pay your bill online or on your mobile device by utilizing SmartHub. Through SmartHub, you can also receive text messages and emails to alert you when your bill is ready to view.
Power Supply and Reliability
Our main source of power (approximately 65 percent) is provided by the Prairie State coal-fired power plant which is located in Washington County, IL. Our wholesale provider, Prairie Power, Inc. (PPI), owns 130 MW of this facility, along with various other natural gas fired generation units, and a portion of wind energy provided by the Pioneer Trail Wind Farm.
PPI also contracts for power supply in the Midcontinent Independent System Operator (MISO) market. Given the recent volatility of natural gas prices (and as many of you experienced first hand with propane prices) which impacted the electricity market pricing, PPI is continually balancing the decision of owning or contracting for future generation resources, in order to provide supply diversity.
These power supply decisions are based on securing long-term electricity for you at the best possible pricing. As recent natural gas market volatility resulted in short-term price fluctuations, we have charted a course for long-term price stability utilizing a diverse supply mix.
Our distribution system performed well this year, resulting in an available reliability of 99.98 percent for those situations within our control (excluding major storms and transmission supply outages). We continue to monitor and upgrade our system to maintain the high level of service you’ve come to expect.
Margins and Capital Credits
Each year, we review our revenue collected compared to our expenses in providing electric service to you. This difference is referred to as margins. The margins try to balance internally generated operating cash with capital provided from long term borrowings. Our Board of Directors have set a policy of returning operating margins back to our member/owners on a 25 year cycle.
In 2013, we were able to refund $1,146,979 in capital credits to member/owners who received service from 1979 – 1981. This return of your equity is one of the unique benefits of membership in a local, not-for-profit cooperative.
A huge thank you goes out to Dave Champion, who retired at the end of 2013 after 40 years of service to EIEC. Dave was a strong advocate for member/owners and employees, and was highly respected in the industry. We wish Dave the best on his well-deserved retirement.
The electric utility industry is continually evolving and becoming more complicated. One of our biggest challenges is to maintain our system and service to the standards that you expect. This is especially difficult since we have an average system density of only three accounts per mile of line we maintain. There is only one co-op in the state of Illinois with a lower density.
We have a good track record of success, and we appreciate the confidence that you have placed in us and our employees to represent your interests in operating our cooperative.
We hope you’ve enjoyed this recap, and that you attend the annual meeting on June 12!
Chairman of the Board