By Citizens Electric Corporation, a members-owned entity
PERRYVILLE — On October 31, 2024, the Federal Energy Regulatory Commission (FERC) approved the separation of Citizens Electric Corporation (Citizens) from Wabash Valley Power Alliance. (Wabash Valley), Citizens Electric’s generation and transmission wholesale provider. The separation is one part of a broader settlement with Wabash Valley. This is an important next step in Citizens path to gaining positive economic benefits for its membership and allowing greater local control for the Corporation.
The Backstory
Citizens has experienced wholesale rate increases from Wabash Valley beginning in 2006 and worked to absorb these rate increases by internally managing cost savings for as long as possible. However, eventually these cost increases to Citizens resulted in a temporary rate change in 2022 and an increase to its members in 2023; the first rate increase since 2015. A second retail rate increase followed in 2024. Over the past several years, Citizens Electric has attempted to gain an understand of Wabash Valley’s costs, the allocation of those costs to its cooperative members and to reach a fair resolution to cost allocation through Wabash Valley’s internal governance processes. After repeated failed attempts working with Wabash Valley to make positive and substantive changes at Wabash Valley, Citizens Electric’s board of directors voted to seek relief for Citizens’ ratepayers at the Federal Energy Regulatory Commission (FERC).
Through productive settlement discussions, Citizens and Wabash Valley worked together to reach a resolution benefitting both organizations. On May 30, 2024, Citizens and Wabash Valley agreed on the key terms of Citizens’ transition from Wabash Valley membership, effective June 1, 2025, including Citizens’ purchase of transmission infrastructure. Under the new agreement, Citizens will continue to purchase wholesale electricity from Wabash Valley as a customer until May 31, 2028. The resolution will facilitate positive changes to Wabash Valley’s generation and transmission business model, as well as provide benefits and flexibility to Citizens.
“FERC’s approval was an important step as we continue to work to execute the terms of our agreement,” said Jason Cates, CEO of Citizens Electric. “As our relationship with Wabash Valley comes to an end, we will be transitioning ourselves to greater independence over our future power supply needs.”
While Citizens will no longer participate as a member of Wabash Valley after June 1, 2025, the parties will continue to engage with one another to identify opportunities to increase reliability and decrease costs for the benefit of each of their memberships.
Q: Who is Wabash Valley Power Alliance?
A: Wabash Valley is a power generation and transmission cooperative located in Indiana, owned and governed by 19 Indiana distribution cooperatives, three Illinois cooperatives, and Citizens. Wabash Valley is bound by long term contracts for all the power supply needs of its 23 owners.
Q:Who is FERC and what is their involvement?
A: The Federal Energy Regulatory Commission provides regulatory oversight over some public Generation & Transmission (G&T) utilities like Wabash Valley. FERC has the responsibility to ensure just and reasonable rates, terms and conditions preventing discrimination, preferential treatment or non-public transmission information.
Q: Will members still be eligible for the Wabash Valley Power Moves rebate program?
A: Citizens’ members will no longer be able to participate in Wabash Valley’s Power Moves rebate program after May 31, 2025. Plans are being developed for a Citizens’ energy efficiency rebate program to replace the Power Moves program.
Q: Will CEC continue to promote its community solar program, SharedSolar Advantage?
A: Citizens is making changes to its SharedSolar offerings that will enable members to enroll in SharedSolar Advantage in 2025.
Q:What happens after May 31, 2028 when Citizens is no longer a Wabash Valley customer?
A: Citizens will begin managing its own power supply allowing for greater control over its power supply costs and needs.
Q: Does this change our rates?
A: As in the past, Citizens will evaluate the need for rate adjustments on an ongoing basis, based on the costs it incurs to provide service.
Q: What does this mean for the future of Citizens Electric?
A: The long-term goal behind transitioning from Wabash Valley membership is to allow Citizens local control over power supply and offer flexibility to take advantage of opportunities to meet current and future energy needs.
Q: What can we as the member expect next?
A: Citizens is dedicated to providing the best possible electric service at a competitive rate with our neighboring electric utilities, not only today, but for generations to come. Citizens commits to ensuring transparency in our efforts, making sure we keep you, our members, fully informed at every significant step along the way. To stay up to date, check back with us by visiting our website cecmo.com.
About Citizens Electric Corporation
Citizens Electric Corporation, established in 1947, is a not-for-profit corporation operating as an electric cooperative located in Perryville, Missouri. Citizens Electric services over 27,000 members in Perry County, Ste. Genevieve County and portions of Cape Girardeau, Bollinger, Jefferson, and St. Francois County. For more information, visit www.cecmo.com or follow Citizens Electric on Facebook and LinkedIn.