No Retail Rate Increase for 2011

I have some good news for the Membership of Northwestern REC : Electric Rates will not increase in 2011. We have completed our budget process for the New Year and have determined that our current rates are adequate for all of our anticipated needs for 2011.

My Staff and I have been fielding a lot of questions about the effect on the Co-op when the “Rate Caps” are removed on many of the State’s Investor Owned Electric Utilities (IOU’s), such as Penelec. Our answers have been consistent – “There is no connection!” I have explained in the past few months that our Co-op Model for Wholesale Power is very different from the IOU’s. We own about 70% of the generation energy our Membership needs at prices well below the current “Market” price for generation. The remaining 30% of our Generation needs is handled by a variety of different contracts with different Market Generators at very competitive prices. The resulting Co-op “Cost to Compare” Generation Price (printed on the Residential Electric Bills) is among the lowest generation cost in all of Pennsylvania, including the IOU’s and the various Electric Generation Suppliers (EGS). Our Membership has had the ability to “Shop” for an EGS for over 10 years and we have not had a Member switch Generation Suppliers yet. I suspect that with the added attention this Fall due to the IOU Rate Cap Removal, there will be a lot of publicity about EGS Offers for Generation, but I also believe that our Generation “Cost to Compare” will be very hard to beat !!

I hope our Membership can enjoy the Holiday Season and look forward to the New Year. Northwestern’s Electric Rates are going to remain stable in 2011 with no increase, which includes a very competitive Electric Generation Component. I am optimistic that our Local and National Economy can continue it’s recovery from the Great Recession!

Merry Christmas and Happy New Year to all our Members as we prepare to celebrate Northwestern REC’s 75^th year of service in 2011 !!

Michael D. Tirpak

General Manager & CEO