REGIONAL— The price of power is heading higher for customers of Lake Country Power, beginning in April. The electric cooperative’s board of directors voted last week to approve higher rates for general service customers in order to bridge a $5.6 million revenue shortfall in their 2022 budget.
“We are keenly aware that any rate increase will have an impact on our members,” says Tracy Peterson Wirtanen, Lake Country Power’s chief financial officer. “As a cooperative, we make every effort to keep our member owners front of mind, especially when making difficult decisions.”
A Lake Country Power press statement cites changing economic issues resulting from the COVID-19 pandemic that have pushed material costs over 30 percent higher and outside labor costs about 10 percent higher.
“In order to maintain our high level of providing safe and reliable electric service, we have no choice but to deal with rising inflation, which is affecting so many businesses including the power industry,” said Mark Bakk, the cooperative’s general manager. “We have successfully been able to keep rates flat for several years, but we are simply out of options.” 
Lake Country Power’s increase comes just weeks after its power supplier, Great River Energy, announced that it would be lowering its wholesale cost of power to the electric cooperatives its serves in Minnesota. Great River indicated that its transition away from coal to renewable sources of power was likely to lead to lower rates initially and rate stability for the foreseeable future.
Bakk said the news from Great River was helpful, but not enough to offset higher costs in other parts of the operation. “With costs increasing in many areas, we welcome stability on our largest annual expense,” he added.
In addition to increased material costs, LCP is dealing with longer-than-normal lead times for items like transformers, meter bases, vehicles and other essential equipment. Some orders that typically required 4 - 6 weeks for delivery now range between 30 - 100 weeks.
 “The supply issue has us feeling like we’re one big storm away from failure,” says Lake Country Power’s Chief Operating Officer Derek Howe. “Those utilities who order as needed are running a huge risk of no longer being essential service providers. We are in a business that needs to keep moving and we are doing all we can to meet that expectation.”
The increase approved by the board calls for an increase of 1.67 cents per kilowatt-hour (kWh) to the general service residential and small commercial rates. For the average co-op member consuming 600 – 1,000 kWh per month, this will result in a rate hike of about $10 – $16.
“Despite the unfortunate need to raise rates, we are proud that we haven’t needed a general service increase in the past six years,” said LCP Board President Craig Olson. “And, we have managed to keep it lower than our cost-of-service study suggested as we see utilities around us proposing steeper increases.”
Lake Country Power serves approximately 43,000 members who reside in rural St. Louis County, northern Lake County and parts of Carlton, Itasca, and Cass counties.