For the past 3 years, Gulf Coast Electric Cooperative has seen a significant increase in the costs of serving members. This is due to inflation, and we have little control over it. We are analyzing our costs to ensure the rates we charge are sufficient to cover the cost of providing reliable service. We have all seen the increased cost of everything from food and housing to gasoline and automobiles.
While inflation at the national level remains in the single digits, inflation on the equipment and materials used in the electric industry has far exceeded that. Costs have increased significantly for wood, copper, steel, aluminum, plastics, rubber and fiberglass used in transformers, regulators, reclosers, poles and wire. For instance, the cost of one type of transformer we must buy to provide electricity has increased 409% during the past 3 years. 1 type of wire we must buy has increased 290% since 2020.
Gulf Coast Electric Cooperative’s management, along with the board of trustees, is reviewing these cost pressures and their impact on our financial health. Keeping the cooperative financially sound is one of the board’s most important responsibilities. Lenders require us to meet certain financial tests to keep our cost of borrowing low. Residents of each district throughout our service territory elect trustees to represent the best interests of members and the financial impacts of every decision are carefully weighed.
As your member-owned, not-for-profit electric cooperative, we have a mission to keep the lights on at a cost our members can afford. We take this role seriously and are responding to market conditions as best we can. Cost pressures are forcing us to consider a rate adjustment, and we only adjust our rates when necessary. As we complete a cost-of-service study, we will continue to share information about costs and rates, so please be sure to look for this information in future issues of Florida Currents.