Friday, January 19, 2018

BEC rate decision was probably the most fair for everyone

In fairness to Beartooth Electric I think the top point missed in A.J. Movius’s letter was that the company is turning its problems around and actually had enough operating capital to pay down its debt with a surplus to give back to users. There were three options for the rate decreases:
1) A 10 percent rate decrease for everyone
2) 12.7 percent for commercial, 10 percent for residential, large commercial, industrial and 5 percent for irrigation
3) No decrease for irrigation, 15.2 percent for small commercial, 10 percent for residential, large commercial, industrial
As a pivot irrigation customer I was invited to the informational meeting held in February. The residential, large commercial and industrial customers were going to get a 10 percent decrease in rates regardless of which option was decided on.
It was very evident the reason for the meeting was to explain to pivot irrigation customers that we were not going to get the same decrease in rates as others.
As an irrigator I believe the first option was correct.
We placed a pivot on our property mainly because we thought it was the environmentally correct way to irrigate. Pivots use less water, produce less runoff and keep the land below the pivot more productive. Less nutrients return to the river. This also keeps the water temperature and level better in late summer for the fish. A pivot costs a farmer over $100,000.
There’s an increase in production, but probably will take at least seven years to recapture the initial costs. Agriculture is a commodity, we still are getting the same price for our crop as we did when we put in the pivot. Cattle have lost a third of their value in the last year. Though all of us would probably like to irrigate with pivots the return on the investment is too uncertain.
The electric bills are a huge cost not associated with flood irrigation, so if it is evident that the electric company is going to be difficult to deal with most farmers will play it safe and stay with flood irrigation.
Everyone is willing to criticize, but usually don’t know the whole story. To run a pivot in our area with natural gas is half the cost of electricity. Beartooth has to compete with other energy options available. If Beartooth is not responsive to the competition it will lose the whole market, which also is bad for everyone. I also believe Beartooth also has an obligation to help agriculture do the best possible practices to help all of us.
The decision made was probably the most fair and equitable when all of the factors were balanced. Residential users got 10 percent regardless. Maybe the best solution would have been to give no one a rate decrease and place more money on the debt. I think Beartooth tried to give its patrons a long deserved reward for sticking with them through the hard times. As usual no good deed goes unpunished.
Diana Scollard