Knowledge is Power

A Cost-of-Service Study is Underway at Lane-Scott Electric

Lane-Scott Electric closely monitors the financial condition of the cooperative. The ever-changing landscape of supply chain challenges and rising inflation has kept us all on our toes the past several years. We know our members trust us to be responsible with their money, and this thought is first and foremost in every financial decision made at Lane-Scott Electric Cooperative.

Part of this responsibility is financial forecasting and rate analysis. As a not-for-profit cooperative, rates must be designed to cover the costs of the cooperative. These costs include the physical assets (equipment, vehicles, substations, etc.)  as well as the expenses (wholesale cost of electricity, wages, day-to-day operating expenses, etc.). The Lane-Scott Electric Board of Trustee’s decided in order to provide you with the best possible analysis, to hire consultant, C.H. Guernsey to conduct a cost-of-service study early in 2024 to provide you with the best possible analysis.  The study will analyze our current and future financial needs against our current rates to ensure the proper amount of revenue is collected to operate effectively and fairly to all members.

Some of you may recall a cost-of-service study was completed in early 2022 that analyzed 2016 through 2020. Despite inflation increasing nearly 10% during those 4 years analyzed, Lane-Scott was able to find efficiencies elsewhere to adjust rates overall only 6.43%. There was a lot of forecasting uncertainty at that time as to where the economy was headed during and post pandemic.  Now, just a few years later, inflation has continued to skyrocket. According to the U.S. Bureau of Labor Statistics Consumer Prince Index Calculator (www.bls.gov/data/inflation_calculator.htm), there has been a 17.8% inflationary rise in materials & costs from December 2020 to November 2023.

We understand our members feel the full impact of inflation in their daily lives, the same as we do as a cooperative. We are not taking this task lightly. We have the fiduciary responsibility to you to balance cost with risk to provide consistent, reliable service.  Our pledge to you has always been to provide safe, reliable electricity at the lowest possible cost. We will continue to do this to the best of our ability.

Once the study is completed, we will hold open meetings to go over the results and recommendations. At this time, members will have the opportunity to voice concerns and ask questions.  If the Lane-Scott Board of Trustees votes to revise any rate tariffs and fees, they will be published in the Kansas Country Living magazine and on our website.