Fighting for a fair, flexible energy futureRon Holcomb | Tuesday, June 01, 2021
If there’s been a theme to Tipmont’s past 12 months, it’s that we’re fighting for you. First, it was to accelerate our fiber internet deployment, which we accomplished. Now, it’s to stabilize the rate we pay for your power supply and offer flexibility that meets your current and future energy needs.
We purchase the power that we distribute to your home from Wabash Valley Power Alliance, a generation and transmission (G&T) utility located in Indianapolis. A large majority of the bill you pay each month (about 70%) comes from power supply costs.
Historically, Wabash Valley been the right choice for Tipmont’s wholesale power needs. But the entire utility industry has radically transformed over the last 15 years. Substantial change is coming to the wholesale power market, and that’s why we are working to keep your rates stable for the future.
In 2018, Wabash Valley asked Tipmont to sign a new 40-year contract. This would extend our purchasing agreement until 2060 but also essentially auto-renew every five years for another five years. In other words, a never-ending contract.
Careful, objective study convinced the Tipmont board of directors that this traditional long-term G&T business model restricts our flexibility to pursue energy market opportunities that can benefit you.
Tipmont’s existing contract with Wabash Valley explicitly states that we have the right to terminate service upon payment of an exit fee. Understanding the available options and significant benefits of a competitive energy market, the board voted to not sign a new contract and asked for an estimated exit fee: What would it cost to withdraw from our commitment to purchase power through Wabash Valley?
Negotiations on a fair and equitable exit fee are ongoing. Tipmont requested that the Federal Energy Regulatory Commission weigh in on several proposed exit fees and replacement contracts, and we hope to reach an agreement sometime this year.
Based on expert research and careful consideration, our board believes Tipmont can better serve you — and better manage your electric power costs — with the freedom to take advantage of alternative options. To learn more — including what will change and what won’t — please visit fightingforyou.tipmont.org.
We believe Tipmont and its customers have the right to a reliable, flexible power supply at a fair rate. Whatever the outcome, you can count on our unwavering commitment, loyalty and perseverance as we fight for you — the 27,000 families, farms and businesses who Tipmont proudly serves.
- Last modified: Monday, June 07, 2021
Ron Holcomb is CEO of Tipmont REMC.