A reality based independent journal of observation & analysis, serving the Flathead Valley & Montana since 2006. © James Conner.

9 April 2015

Flathead Electric Co-op trustee election closes tomorrow

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The Flathead Electric Cooperative’s board of trustees is among the most and important non-profit boards in the Flathead Valley. Only the local hospital boards are more prestigious, and arguably no local private board is more important to the day-to-day lives of Flathead residents.

FEC’s annual trustee election closes tomorrow. Trustees for three districts are will be elected. Two of the positions are contested (see the Flathead Beacon’s story for details). Given the importance of the job, the statements of the candidates are disappointing — with one exception: that of Emery Smith (pictured right), the incumbent secretary-treasurer. Smith set up a website, fectrustee2.com, that (a) explains how he believes FEC should be managed, (b) provides an interesting and useful history of FEC, and (c) lays out his impressive resume in detail.

Is FEC well managed? I don’t know. I would like to think it is, and it may be well managed. No managers or trustees have been jailed, so that’s a good sign. But the management of the cooperative is relatively opaque — there’s no online history of rates, for example — and my impression is that the rates for residential customers have risen faster than the rates for business customers. Plus, the rate rollouts are infuriatingly ragged.

In addition, there’s FEC’s exorbitant base rate of $22.13 per month that makes the true cost per kilowatt hour delivered to customers much higher than the energy charge in the rate schedule (see the graphs in my 23 June 2014 post).

Electric utilities can get away with charging base rates because they have a monopoly. They argue the base rate covers infrastructure costs. But infrastructure and distribution costs can be included in the unit cost of energy. When was the last time you paid a pump charge plus a charge per gallon when you purchased gasoline or diesel fuel? Base charges for electricity are not necessary, and they distort the true cost of the delivered kilowatt hour. To me, high base charges such as FEC’s are not a sign of good management.