Arkansas River Power Authority to Reduce Electric Rate for 2019

December 13, 2018. Lamar, Colo. – At its December meeting, the Arkansas River Power Authority (ARPA) Board of Directors adopted its 2019 budget that included a 2% reduction in its wholesale energy rate. The rate decrease comes after several years of stable rates that have not seen any rate increases since 2011.

The ability of the Board to reduce rates can be directly attributed to steps ARPA has taken over the last few years to reduce operating costs. The Board successfully refinanced its long-term debt in July of 2018 which resulted in a significant savings through the term of the bonds. In addition, ARPA settled all its outstanding litigation late in 2017 and finalized the settlements in 2018. These actions resulted in a considerable savings in legal fees and administrative costs.

Board President David Willhite characterized the rate reduction as the first step in a long-term trajectory of continued stable to lower rates for the Power Authority. “The Board’s financial planning includes retiring a portion of ARPA’s debt in 2020 which will trigger an additional rate decrease in 2021,” said Willhite. Willhite went on to say that “ARPA is in a position to negotiate long term power supply contracts that would further reduce rates over the long term. We believe ARPA is in a good place financially.”

The rate reduction, which will become effective in January, is projected to save ARPA members and their rate payers between $350,000 and $400,000 annually beginning in 2019.

The Arkansas River Power Authority is a Joint Action Agency that provides wholesale electricity to its member communities of Holly, La Junta, Lamar, Las Animas, Springfield and Trinidad, Colorado