Full Transcript for Flathead Electric Cooperative: Powering the Flathead with Katie Pfennigs

--> 00:02:13.280 Well, I'm I'm thankful to hear that, and I'm sure everyone listening is I bleed blue and gold for sure. 00:02:13.759 --> 00:02:16.400 They're yelling in their cars right now as they listen to the podcast. 00:02:16.639 --> 00:02:17.120 Well, good. 00:02:17.199 --> 00:02:18.400 Well, we appreciate you being here. 00:02:18.479 --> 00:02:20.159 We look forward to this conversation. 00:02:20.400 --> 00:02:29.199 Flathead Electric has been in the news lately, announcing an investment in new natural gas generation facility in northern Idaho, of all places. 00:02:29.439 --> 00:02:33.360 What does this mean for people here in northwest Montana and why is it important? 00:02:34.000 --> 00:02:36.159 Yeah, well, um, thank you for that question. 00:02:36.319 --> 00:02:41.840 Uh, we have had, as you can imagine, a lot of conversations around this announcement recently. 00:02:42.000 --> 00:02:53.599 Uh, but really, this is a function of years of long-term power supply planning work that Flathead Electrics board and staff have undertaken. 00:02:54.159 --> 00:03:08.879 And uh, and we have done that in the last several years in partnership with PNGC Power, which is the generation and transmission co-op that we are a member of, um, along with uh many other co-ops in the Pacific Northwest. 00:03:09.120 --> 00:03:23.919 And so PNGC is a co-op of co-ops, essentially, and they are the partner that has been helping us look at growing loads, how we meet demand into the future, and how we develop resources that we need to do that effectively. 00:03:24.080 --> 00:03:37.280 So while this uh is certainly a new topic of conversation for all of us to be discussing around uh, you know, building new generation, it's been a long planning process for our board of trustees and not a decision that is taken lightly, right? 00:03:37.439 --> 00:03:43.120 These are big investments and um big long-term decisions to meet the needs of our growing valley into the future. 00:03:43.360 --> 00:03:44.080 Yeah, absolutely. 00:03:44.159 --> 00:03:48.159 And I I imagine just a massive amount of due diligence is required in this. 00:03:48.400 --> 00:03:50.000 Tell me a little bit about a timeline. 00:03:50.159 --> 00:03:52.000 It's taken a long time to get to this point. 00:03:52.159 --> 00:03:56.800 Now, what do we have to look forward to before this is online and and contributing power to the grid? 00:03:57.120 --> 00:04:02.479 Yeah, I'll tell you that's something about um our industry that I have learned in my my 10 years at Flathead Electric. 00:04:02.639 --> 00:04:04.560 Nothing happens quickly. 00:04:04.719 --> 00:04:08.080 And so these planning processes take uh several years. 00:04:08.240 --> 00:04:13.599 Um, you know, we're doing our forecasts out 10 years to try to understand what our needs are going to be. 00:04:13.840 --> 00:04:20.879 And then um all of the resources that get built are also years-long um large, you know, utility-scale infrastructure resources. 00:04:20.959 --> 00:04:26.879 And so, yes, you're right, very long timelines, long lead times right now on um all of the equipment that's needed. 00:04:27.040 --> 00:04:33.360 These uh these investments take a very long time, and uh this project is not slated to come online until um the 2030s. 00:04:33.759 --> 00:04:35.279 Yep, so it's a little ways out there. 00:04:35.439 --> 00:04:42.240 It is which in a regulated industry with a project of this size, it that's just the way it is, uh unfortunately. 00:04:42.399 --> 00:04:46.240 Uh, and that's in a society that expects things to move quickly, instant gratification. 00:04:46.319 --> 00:04:46.959 So you're right. 00:04:47.279 --> 00:04:57.920 The good news is is I can tell you that Flathead Electric Co-op is incredible at communication uh through your newsletters, all the events where you guys are speaking here uh through the chamber, for instance. 00:04:58.079 --> 00:05:01.040 And I'm appreciative of all the updates that you guys give. 00:05:01.199 --> 00:05:03.199 It sets us up for success in the long run. 00:05:03.519 --> 00:05:03.839 Good. 00:05:03.920 --> 00:05:13.439 Well, well, um, and that is definitely part of our mission is to be you know transparent and provide as much education as we can uh for the members that we serve. 00:05:13.600 --> 00:05:23.199 That's one of uh my favorite parts about working at a cooperative, is that really we are rooted in those cooperative values, and one of those is education for our community. 00:05:23.279 --> 00:05:31.839 And so um, in that spirit, um, you know, being owned by the members that we serve, it's very important that we are open and do keep this education going. 00:05:31.920 --> 00:05:50.079 These are complex topics, and we are really fortunate to have a membership uh here within the Greater Flathead Valley that cares an awful lot about the decisions that are being made on their behalf at the co-op by the trustees that they have elected to serve and to run the utility, and uh and we do not take any of that responsibility lightly. 00:05:50.319 --> 00:05:51.040 Yeah, well, excellent. 00:05:51.120 --> 00:05:54.879 Well, we appreciate that, and we and we appreciate that that good communication. 00:05:55.120 --> 00:06:00.800 I think we all know electric rates are going up across the country, and it sounds like they're increasing locally as well. 00:06:01.040 --> 00:06:06.160 Flathead Electric announced an overall 5.5% increase that took effect June 1st. 00:06:06.319 --> 00:06:09.600 Can you explain why rates are increasing here and across the nation? 00:06:10.000 --> 00:06:10.480 Yes. 00:06:10.639 --> 00:06:18.560 Uh, well, we are um not unlike any other industry or business right now, we are seeing our prices um increase. 00:06:18.720 --> 00:06:21.920 And that's not just our wholesale power costs. 00:06:22.000 --> 00:06:29.759 We are seeing the prices of all of the goods and services that we need to keep power reliable and affordable increase as

well. 00:06:30.000 --> 00:06:37.600 We have experienced doubling of costs on some of our equipment, like the line trucks that we need to um to supply to our line crews. 00:06:37.759 --> 00:06:44.639 I mean, even just the wires that that we need to run in the poles uh to keep the infrastructure sound is increasing rapidly. 00:06:44.800 --> 00:06:47.120 So we are no stranger to increasing costs. 00:06:47.360 --> 00:06:53.600 Uh that said, we're also very sensitive to the impacts that rate increases have on our membership. 00:06:53.759 --> 00:07:02.959 We've been um, I think very fortunate to have come through a period here where rate increases were kept um very low, below the cost of inflation for many, many years. 00:07:03.120 --> 00:07:11.439 And so we have seen that at this time we we have to increase rates in order to keep providing the level of service and that we need to. 00:07:11.600 --> 00:07:14.639 So uh certainly part of that is power costs. 00:07:14.720 --> 00:07:17.920 Um, yes, we are seeing increases in our wholesale power costs. 00:07:18.079 --> 00:07:25.839 We're really fortunate to be served by primarily by uh hydropower from the federal hydropower system across the Pacific Northwest. 00:07:26.000 --> 00:07:33.600 And that is uh fortunately for us one of the most cost-effective uh power generation sources really in the whole country. 00:07:33.680 --> 00:07:36.720 Um, but um, those costs are are rising too. 00:07:36.800 --> 00:07:42.000 And so as a member-owned cooperative, our mission is to serve power at cost. 00:07:42.160 --> 00:07:44.000 We uh we are a not-for-profit. 00:07:44.079 --> 00:07:48.399 Um, we don't take a profit on top of the costs that we incur. 00:07:48.639 --> 00:07:51.279 So our members are really truly getting this service at cost. 00:07:51.439 --> 00:07:55.439 And as our costs increase, um, those increases are passed along to our membership. 00:07:55.600 --> 00:08:02.800 So um, for example, wholesale power costs this year from Bonneville Power Administration increased something like eight, eight or nine percent. 00:08:02.879 --> 00:08:08.720 And then on the transmission side, what we pay for transmission services, we saw increases of uh more like 18%. 00:08:09.279 --> 00:08:20.480 So, yes, those are costs that we're incurring um as all of our members use power and use that system, and we do our best to ensure that we fairly allocate those costs back to our membership. 00:08:20.639 --> 00:08:25.519 Um, and you know, unfortunately, sometimes that does result in uh rate increases. 00:08:25.839 --> 00:08:26.000 Yeah. 00:08:26.079 --> 00:08:29.360 Well, you got to, I mean, a number of things at work here, supply and demand. 00:08:29.519 --> 00:08:36.480 Yeah, we touched on that on our first talking point about just adding additional supply, diversifying where the supply is coming from. 00:08:36.559 --> 00:08:42.000 And with additional supply, hopefully that helps bring costs down or slow them from going up. 00:08:42.159 --> 00:08:45.039 And then I just think I look around at gas prices, for instance. 00:08:45.360 --> 00:08:53.919 Well, I think a flathead electric co-ops cruise with those trucks you guys have, those big diesel pushes that are going out to service lines, for instance, after a storm. 00:08:54.240 --> 00:08:56.960 Those prices are going up when the diesel goes up, for instance. 00:08:57.039 --> 00:08:58.879 And so it's understandable. 00:08:59.039 --> 00:09:03.360 It's a bummer, obviously, for folks that have to pay because and that uh that's across the board. 00:09:03.440 --> 00:09:08.159 If you go have lunch somewhere at a local cafe, you'll see that prices have gone up. 00:09:08.240 --> 00:09:12.080 And so it's uh unfortunately that's just the environment that we are in. 00:09:12.159 --> 00:09:14.240 Uh we're all we're all feeling that crunch, aren't we? 00:09:14.399 --> 00:09:27.120 We're all yeah, we're all feeling a little bit of pinch, but I'm appreciative of how you're explaining that nonprofit setup and how you know the due diligence is there uh to make sure and not pass additional costs on that don't need to be passed on, and we appreciate that. 00:09:27.440 --> 00:09:28.559 Well, we'll keep doing our best. 00:09:28.639 --> 00:09:35.840 You know, um I always like to remind people that we are all co-op members too, and we all pay the very same rates that all of you do. 00:09:35.919 --> 00:09:38.960 I sometimes get asked if I get a discount for working at Flathead Electric. 00:09:39.120 --> 00:09:39.600 No, I do not. 00:09:39.679 --> 00:09:40.320 I too am I. 00:09:41.039 --> 00:09:44.240 If that's the case, I'm gonna have to withdraw my pending application with you. 00:09:44.559 --> 00:09:44.960 Oh well. 00:09:45.120 --> 00:09:48.720 Well, you know, I'll I will say it's still a pretty good place to work, even without that discount. 00:09:49.120 --> 00:09:55.039 I'll tell you, and talking to various employees that work at Flathead Electric Co-op, what an incredible culture you guys have there. 00:09:55.279 --> 00:09:57.360 It sounds like just a wonderful work environment. 00:09:57.759 --> 00:09:58.480 We do, we do. 00:09:58.559 --> 00:10:04.639 Um we work awfully hard and we all really feel like we are able to serve the community from these roles and these seats. 00:10:04.799 --> 00:10:08.080 And um, and yes, but no, we don't like those rate increases either. 00:10:08.159 --> 00:10:12.240 So before we move on to the next uh question, Katie, how about data centers? 00:10:12.399 --> 00:10:19.840 I'm reading a lot about the just the rollout of artificial intelligence, the amount of computing power that is needed to facilitate the AI. 00:10:20.080 --> 00:10:22.240 Is that taking place up in our part of the footprint? 00:10:22.320 --> 00:10:25.279 And does that is that part of the reason we're seeing costs go up as well? 00:10:25.600 --> 00:10:26.240 Good question. 00:10:26.399 --> 00:10:32.080 Um that that's a question that we are

increasingly hearing from our members concerns about these very, very large loads. 00:10:32.320 --> 00:10:41.120 Um, I think to some degree that data centers have become sort of a convenient shorthand for um for really what's a much larger issue. 00:10:41.360 --> 00:10:44.240 Data centers are large, they are very energy intensive. 00:10:44.320 --> 00:10:47.279 Um, so they they are easy to point to in some cases. 00:10:47.519 --> 00:10:51.120 I would say they're not really the root problem that we're facing right now. 00:10:51.519 --> 00:11:01.519 The root problem really is that the Northwest's power systems is really a regional problem, um, is entering a period where we have seen demand is it's growing rapidly. 00:11:01.759 --> 00:11:06.000 We've seen that in the flathead as well, but that's really been across the entire Pacific Northwest. 00:11:06.080 --> 00:11:08.399 And we're all part of an interconnected grid, right? 00:11:08.480 --> 00:11:13.519 And so that growth that's happening across the Northwest US impacts the entire region. 00:11:13.759 --> 00:11:20.720 And that demand is growing faster than dependable infrastructure has been built and really, you know, can be built. 00:11:20.799 --> 00:11:22.960 And so that's where this concern is coming in the future. 00:11:23.039 --> 00:11:26.399 But I I wouldn't frame it entirely as a data center problem. 00:11:26.559 --> 00:11:32.799 I would frame it as more of a problem around planning and infrastructure development and trying to keep power reliable. 00:11:32.960 --> 00:11:36.080 And we've seen a lot of impacts or a lot of pressures there, right? 00:11:36.240 --> 00:11:46.879 So um the electrification of everything, um, you know, if you look around probably your own home, I would say you've probably increased the amount of electric devices in your home. 00:11:47.039 --> 00:11:54.080 You know, I look at my own house, uh, you know, you got bikes, you didn't have to use to have to plug in your bike, your car, of course. 00:11:54.159 --> 00:11:56.720 That's a large load if you drive an electric vehicle. 00:11:56.879 --> 00:12:02.000 Um, but I mean, I even sometimes point out like my my ice fishing auger has a battery on it now, right? 00:12:02.080 --> 00:12:11.840 So it's just everything, the tools and the um, and I mean, full electrification on the West Coast, we're seeing a lot of switching from natural gas to electric heating, for example. 00:12:12.000 --> 00:12:23.279 And so all of that electrification and all of those pressures at the same time as we've been decreasing the amount of power that can be produced reliably, exactly when the grid needs it. 00:12:23.360 --> 00:12:23.600 Right. 00:12:23.679 --> 00:12:31.200 So we're reducing the amount of um coal-fire generation and restricting the amount of natural gas that can be built in some places. 00:12:31.440 --> 00:12:52.080 Those two things happening at the same time is really what's um, I would say, caused the concerning reliability challenges that, you know, now we're reading about in the news and um and really what's, you know, a lot of what's driven the decisions for Flathead Electric to invest in new resources to ensure that we can continue to have a reliable power supply well into the future. 00:12:52.639 --> 00:12:53.120 Excellent. 00:12:53.360 --> 00:12:54.559 You know, you bring up a good point. 00:12:54.639 --> 00:12:58.559 I've noticed more people are using electric mowers and snowblowers, for instance. 00:12:58.720 --> 00:13:04.720 And when you think about that, the more of those that are in everyone's garage, there is a charging pack that's plugged into the wall. 00:13:04.960 --> 00:13:07.519 After someone cuts their lawn, they're plugging in batteries. 00:13:07.919 --> 00:13:08.480 Exactly. 00:13:08.639 --> 00:13:09.200 Exactly. 00:13:09.440 --> 00:13:20.879 Yeah, and to answer your question, though, around data centers, there are times when I think that uh the data center's load because it is so constant, can be beneficial to some grids, right? 00:13:20.960 --> 00:13:25.519 It's just about how we plan for them, how we build infrastructure, and then how we assign costs. 00:13:25.679 --> 00:13:32.080 Um, you know, a data center, just like from the co-ops perspective, like anyone, any member should not get a free ride. 00:13:32.159 --> 00:13:36.000 We don't want the rest of our members to have to shoulder the cost of a data center. 00:13:36.080 --> 00:13:45.039 And so, um, and so we we build our policies and set our rates to ensure that all of our members who are the cost causers are also the cost payers. 00:13:45.120 --> 00:13:46.720 It's that cost causation model. 00:13:46.879 --> 00:13:47.039 Okay. 00:13:47.200 --> 00:13:51.200 And so that's really important as we think about adding large new loads. 00:13:51.519 --> 00:13:59.279 And also here locally, um, really, we haven't seen a lot of these large new loads come onto our system. 00:13:59.360 --> 00:14:00.960 Um, I think for a number of reasons. 00:14:01.120 --> 00:14:04.480 You know, property costs are very high here in the flyhead, we all know that. 00:14:04.639 --> 00:14:13.120 Um, and you know, we also have um at this point, uh, the transmission system coming into the Bar Valley is getting more and more constrained. 00:14:13.279 --> 00:14:18.080 And so to think about bringing on a very, very large new load, probably just really not feasible at this time. 00:14:18.240 --> 00:14:20.960 Um, but we do, we're getting more and more questions about that. 00:14:21.039 --> 00:14:27.759 And I just think it's important that we look at the broader picture and not uh, you know, really not point to any one particular class of member. 00:14:28.240 --> 00:14:28.879 Absolutely. 00:14:29.039 --> 00:14:36.639 Well, when we think about just the again, supply and demand, uh that's gonna bring up something I believe you guys probably get a lot of calls on. 00:14:36.799 --> 00:14:37.919 That's demand charge. 00:14:38.080 -->

00:14:40.080 And so I could have guessed that would be that question. 00:14:40.480 --> 00:14:40.799 Right, right. 00:14:40.960 --> 00:14:53.039 And so I I kind of want to first of all, I want to uh maybe for the benefit of everyone and and for you to tell your team is uh we find ourselves calling customer service maybe once or twice a year, if that. 00:14:53.279 --> 00:15:00.240 And every single time we hang up the phone, I think that was an incredible experience talking to a flathead electric co-op employee. 00:15:00.399 --> 00:15:02.159 And so I think it would be beneficial. 00:15:02.240 --> 00:15:04.480 Maybe we should do a little bit of a role play here. 00:15:04.799 --> 00:15:08.000 I actually brought my flathead electric cooperative bill. 00:15:08.480 --> 00:15:10.159 I have it right here in front of me. 00:15:10.480 --> 00:15:10.960 I love this. 00:15:11.200 --> 00:15:11.440 Yes. 00:15:11.519 --> 00:15:16.799 And so what I'm going to do is I'm gonna call Katie and ask her a couple questions regarding my bill. 00:15:16.879 --> 00:15:22.879 And I just know it's gonna be a pleasant experience, and I think it will be educational for the listeners of the podcast today. 00:15:23.200 --> 00:15:25.600 You have no idea how often this happens at a dinner party. 00:15:26.080 --> 00:15:26.559 Excellent. 00:15:26.799 --> 00:15:35.919 And so I'm thinking that this podcast is gonna be posted on your website, and you can say, for questions regarding the demand charge, please reference the podcast. 00:15:36.240 --> 00:15:38.240 So let's just say the phone's ringing. 00:15:38.320 --> 00:15:39.200 How are you answering? 00:15:39.919 --> 00:15:40.480 Well, hello. 00:15:40.559 --> 00:15:42.320 Thank you for calling Flat Electric Co-op. 00:15:42.559 --> 00:15:43.039 This is Katie. 00:15:43.519 --> 00:15:46.240 Katie, hello, my name's uh Brendan Craig. 00:15:46.320 --> 00:15:52.240 Uh I'm calling about a question on my bill, and I would like to get a breakdown of what I'm seeing here. 00:15:52.559 --> 00:16:00.639 I see where I am paying what appears to be a tiered rate, starting with zero to six hundred KWH. 00:16:00.720 --> 00:16:02.080 Is that kilowatt hours? 00:16:02.399 --> 00:16:03.840 That is kilowatt hours, yes. 00:16:04.080 --> 00:16:04.480 You got it. 00:16:04.720 --> 00:16:08.000 So I see I see I paid$32.94. 00:16:08.480 --> 00:16:11.440 Then I see I went from$601 to$3,500. 00:16:11.840 --> 00:16:13.600 I paid$34.48. 00:16:14.000 --> 00:16:18.480 Uh not I'm not a scientist by any means, so I'm I'm not questioning that. 00:16:18.639 --> 00:16:21.519 I probably used a little more power, maybe, so I got charged a little bit more. 00:16:21.679 --> 00:16:25.360 But specifically, what I'm looking at here is a demand charge. 00:16:25.600 --> 00:16:32.240 And it says on May 14th at 5 to 6, I got charged$23.27. 00:16:32.639 --> 00:16:34.080 Could you tell me what that is? 00:16:34.399 --> 00:16:35.120 Absolutely. 00:16:35.360 --> 00:16:36.639 Glad that you asked. 00:16:36.799 --> 00:16:46.720 Um, so the way that our rates are structured is really similar to the way that we pay for power and to the costs that we incur as a co-op. 00:16:47.200 --> 00:16:58.240 And uh a lot of the costs that we incur on our power is related to demand, which is really a function of when we have our highest energy usage. 00:16:58.480 --> 00:17:04.880 And so as a co-op, we try to pass along those costs as fairly as possible to the members. 00:17:05.519 --> 00:17:17.119 And so our members who ex who have a higher demand, uh, which essentially is how much energy that you're requiring at any one given time, you know, that's where you're seeing that demand charge. 00:17:17.279 --> 00:17:22.400 And so I think it's important to think about the difference between energy and capacity. 00:17:22.799 --> 00:17:36.400 And we have several, uh, several different ways that we can can kind of talk about this, but I think of your energy charges, which are those kilowatt hour charges as how much you used over the entirety of your month-long billing cycle. 00:17:36.640 --> 00:17:36.799 Okay. 00:17:36.960 --> 00:17:43.440 Okay, so how many kilowatt hours that you consumed to electrify your home or your business. 00:17:43.759 --> 00:17:46.400 The demand charge is a capacity charge. 00:17:46.480 --> 00:17:49.920 So how much did you need at any one given time? 00:17:50.160 --> 00:17:59.759 And the reason that that's important is so for one, um, because we're charged a higher charge when our system hits its peak, we get a essentially demand charge. 00:17:59.920 --> 00:18:05.119 And then we also have infrastructure charges that are higher if you have a higher demand. 00:18:05.359 --> 00:18:18.000 So if you think about uh like the poles and wires and the transformers that are serving your home, we have to build that equipment to to be able to meet your highest demand at any given time. 00:18:18.240 --> 00:18:24.720 And so costs that the co-op is incurring on your behalf to have those larger poles and wires are reflected in that demand charge. 00:18:25.039 --> 00:18:25.119 Okay. 00:18:25.200 --> 00:18:26.160 And so it's broken down. 00:18:26.319 --> 00:18:30.720 Now, is there certain time periods where where those demand charges take place? 00:18:31.039 --> 00:18:33.039 There are for our residential members. 00:18:33.200 --> 00:18:37.599 So we've got demand hours in the morning and demand hours in the evening. 00:18:37.680 --> 00:18:46.799 Um, they're in three-hour blocks, and it is um really reflective of when, again, when our system also is peaking and we're typically incurring our demand charges, right? 00:18:46.880 --> 00:18:52.720 And so we've done our best to try to reflect that fairly and accurately in the way that we bill our members. 00:18:52.880 --> 00:18:55.519 And it's also important to know it's only on the weekdays. 00:18:55.680 --> 00:18:57.839 Okay, so we never charge for demand on weekends. 00:18:58.160 --> 00:18:59.440 Okay, so

it's Monday through Friday. 00:18:59.680 --> 00:19:00.240 Monday through Friday. 00:19:00.559 --> 00:19:01.440 In the morning and in the evening. 00:19:01.680 --> 00:19:01.920 Exactly. 00:19:02.240 --> 00:19:04.000 You happen to know the hours specifically, is it? 00:19:04.240 --> 00:19:05.279 Yes, 7 to 10 a.m. 00:19:05.440 --> 00:19:06.400 and 5 to 8 p.m. 00:19:06.880 --> 00:19:10.240 Okay, so I'm gonna drill in here because I kind of nerd out on power here. 00:19:10.480 --> 00:19:12.640 So five to eight and seven to ten. 00:19:12.880 --> 00:19:18.480 So seven to ten in the morning, which makes sense because that's probably when a lot of families are getting up and getting ready. 00:19:18.640 --> 00:19:22.400 And so the grids, they're starting to turn on a lot of different items in their house. 00:19:22.559 --> 00:19:26.160 And then also from five to eight, that's when folks are getting home. 00:19:26.319 --> 00:19:30.480 Again, stuff gets turned on in the house, dinner's being cooked, et cetera. 00:19:30.880 --> 00:19:40.240 And so those are the periods of time if you're seeing a demand charge on your bill, that's where you can get you can be cognizant of what what appliances, for instance, you're using. 00:19:40.559 --> 00:19:42.480 Yes, and that's exactly right. 00:19:42.720 --> 00:19:49.440 And this actually, interestingly, um, people are noticing this demand charge now, probably because it's higher than it used to be. 00:19:49.519 --> 00:19:54.960 But we've had a demand charge on our residential members' bills since 2019. 00:19:55.359 --> 00:19:57.759 So, um, so we are getting more questions about it. 00:19:57.839 --> 00:20:00.720 I think a lot of people assume it's new, but it's it's not new. 00:20:00.960 --> 00:20:02.240 It has been there for quite some time. 00:20:02.400 --> 00:20:22.400 We've just uh we we've increased it over the years, right, to be more reflective and to try to give our members an opportunity to better understand the demand charge, better understand what demand is, because it is a departure from the way that you know that historically that we've charged for energy and that people are used to being charged for their electricity consumption. 00:20:22.559 --> 00:20:26.799 They're very accustomed to how much did I use, you know, times a rate. 00:20:27.039 --> 00:20:27.279 Sure. 00:20:27.519 --> 00:20:28.319 End of story, right? 00:20:28.799 --> 00:20:35.759 You talked about those tiered energy rates, and we do give you a bit of a break if you're using less energy, you know, for the all the same reasons, really. 00:20:36.160 --> 00:20:36.480 Absolutely. 00:20:36.880 --> 00:20:55.279 But as we've seen the way that that that we pay for wholesale power change, and as we've seen our our system costs really change to to need to serve our members for these really high peaks, um, we really have needed to make a change to the way that we bill as well to make sure that it's it's fair. 00:20:55.359 --> 00:20:55.680 Yeah. 00:20:55.839 --> 00:21:08.079 And we s we actually interestingly have have seen our some of our members who have a lower demand have had uh have have seen their energy bills go down, which is an indication that they were subsidizing all the rest of us, essentially, right? 00:21:08.160 --> 00:21:10.799 Which we want to make sure that we're not not doing. 00:21:10.960 --> 00:21:11.119 Yeah. 00:21:11.359 --> 00:21:30.079 And so uh really it it truly is a more fair and accurate way to bill you based on what you on the costs that you know that we incur on your behalf on this system, and to make sure that that you know you're not overpaying when you do control your demand and you know that somebody else isn't shouldering your burden also. 00:21:30.240 --> 00:21:30.400 Yeah. 00:21:30.799 --> 00:21:32.240 So it's it's much more fair on both sides. 00:21:32.559 --> 00:21:32.880 Excellent. 00:21:32.960 --> 00:21:50.960 And so maybe a takeaway or two uh from this conversation, which I really appreciate, uh the explanation of the demand charge is if you're thinking about all the thermostats, for instance, smart thermostats, maybe you uh if it's winter, you heat your house up and then have it take a break during those dem demand hours. 00:21:51.599 --> 00:21:54.400 Um uh or air conditioning, for instance. 00:21:54.480 --> 00:22:03.200 Uh if you're doing a washing machine, uh your dryer, for instance, uh Uh you might focus on doing your laundry on the weekends, maybe. 00:22:03.519 --> 00:22:13.599 Or during the if if you're home doing it during the day outside of those demand hours and that that in that case you're spreading out uh your energy usage for capacity purposes. 00:22:14.000 --> 00:22:14.480 Right, exactly. 00:22:14.559 --> 00:22:22.720 And so yeah, so I mean, what the demand charge is based on is the single highest hour of kilowatt hour usage, right? 00:22:22.880 --> 00:22:29.839 So it's it if you think about how you can control your demand, it's actually much more controllable than your energy charges are, right? 00:22:29.920 --> 00:22:36.559 You need the it you need to use the electricity in your home that you need to use, but you have more control over when you use that energy. 00:22:37.680 --> 00:22:39.200 And not everyone, and I understand that. 00:22:39.359 --> 00:22:47.759 I probably fall into that category where I I have two young kids and we're on the go and I just need it when I need it, and I there's very little I can do to shift my usage. 00:22:47.839 --> 00:22:49.279 And so I pay a high demand charge. 00:22:49.359 --> 00:22:53.279 I don't love it, but I know that those that I, you know, those are costs that I am causing. 00:22:53.359 --> 00:23:00.640 And I don't want you, Brendan, having to pay for my high demand and say, you know, that that just is a function of of fair, you know, fair rate setting. 00:23:00.880 --> 00:23:04.400 But it does give you the ability to um to try to shift some of it. 00:23:04.480 --> 00:23:08.640 So things

that even I have done is, you know, set the delay on my dishwasher. 00:23:08.720 --> 00:23:09.119 That's easy. 00:23:09.440 --> 00:23:10.640 Get it outside of those demand hours. 00:23:10.720 --> 00:23:11.680 Why would I not do that? 00:23:11.920 --> 00:23:17.839 Home heating and water heating are the two highest consumption activities, energy consumption activities in a home. 00:23:18.079 --> 00:23:23.519 And so if you are heating with electricity instead of natural gas, then looking at ways to shift that, you're right. 00:23:23.599 --> 00:23:33.279 Um you know, can you cool your home a little bit outside of those demand hours and then, you know, let your AC take a break during the demand hours, um, or vice versa on the heating. 00:23:33.440 --> 00:23:37.519 You know, lots of little ways that you can can look at trying to reduce your demand. 00:23:37.599 --> 00:23:39.599 There are lots of great timers out there on the market. 00:23:39.839 --> 00:23:41.680 Flathead Electric has a couple programs. 00:23:41.759 --> 00:23:45.440 We've got a water heating demand response program, it's called. 00:23:45.519 --> 00:23:55.440 Um, it's a responding to that high demand where we actually will install a unit on your water heater and then turn it off during all the peak hours, which saves about four KW. 00:23:55.759 --> 00:23:56.000 Yeah. 00:23:56.160 --> 00:24:04.880 And when you multiply that by, you know, the demand charge of$4, you can see some significant savings if you just shut that water heater off during all of those peaks. 00:24:05.039 --> 00:24:14.720 And because you have a 50 gallon, 50 gallons typically of hot water stored in your tank, yep, you use that during that time and most people never even notice that it's there. 00:24:14.799 --> 00:24:15.039 Right. 00:24:15.200 --> 00:24:15.359 Right. 00:24:15.440 --> 00:24:16.559 That the that we've shut it off. 00:24:16.720 --> 00:24:25.279 So well, it's good that we have the technology at our fingertips to to leverage, to try to use, you know, have things turn on and off outside of the demand hours. 00:24:25.440 --> 00:24:25.519 Yeah. 00:24:25.680 --> 00:24:26.160 So excellent. 00:24:26.240 --> 00:24:26.400 Okay. 00:24:26.960 --> 00:24:27.440 Did that help? 00:24:27.680 --> 00:24:29.119 I it did absolutely help. 00:24:29.279 --> 00:24:32.559 I appreciate the excellent customer service in explaining that all to me. 00:24:32.880 --> 00:24:33.599 Yes, absolutely. 00:24:33.839 --> 00:24:34.720 Happy to anytime. 00:24:34.799 --> 00:24:36.640 And if you need another explanation, call us again. 00:24:37.200 --> 00:24:37.680 Call us again. 00:24:37.759 --> 00:24:39.599 And yep, and that it's we'll walk you through it. 00:24:39.920 --> 00:24:42.319 It's basic supply and demand, so it makes sense. 00:24:42.480 --> 00:24:49.680 And I think that for those that pay attention, there's ways that you can try to mitigate it just through being intentional of when you're using your power. 00:24:49.839 --> 00:24:50.400 Yeah. 00:24:50.799 --> 00:24:51.119 Okay. 00:24:51.200 --> 00:24:56.960 Well, I think we all know there's certainly challenges facing the the energy industry, as we've highlighted through this conversation. 00:24:57.200 --> 00:24:58.880 I'd like to end on a positive note. 00:24:59.119 --> 00:25:02.079 What are some of the best things happening at Flathead Electric? 00:25:02.160 --> 00:25:05.279 And what gives you hope and confidence about our energy future? 00:25:05.680 --> 00:25:06.480 Great question. 00:25:06.640 --> 00:25:09.920 Um, yeah, there are a lot of challenges in this industry right now. 00:25:10.079 --> 00:25:18.480 You know, I have I have a lot of optimism just in the fact that we are still locally served by an electric co-op. 00:25:18.720 --> 00:25:24.720 I think that we're very fortunate in this area to uh to have cooperative service. 00:25:24.799 --> 00:25:28.880 Um, it's a very different business model than other utility models. 00:25:29.119 --> 00:25:34.559 And Flathead Electric is extremely conscientious about the way that we that we provide electric service. 00:25:34.799 --> 00:25:43.119 I had mentioned those cooperative principles, um, concern for community and providing benefit to our community are things that we uh that we focus a lot on. 00:25:43.200 --> 00:25:52.640 You know, we have 160 employees at the co-op, and so many of them are out there serving the community in other ways than just through their work at the co-op. 00:25:52.880 --> 00:25:54.319 I see, I just see a lot of positives. 00:25:54.400 --> 00:25:57.279 Our Roundup for Safety program is a big highlight. 00:25:57.440 --> 00:26:04.160 You know, one of the the highlights that I get to work with all of you round up your the that round up your electric bills each month. 00:26:04.319 --> 00:26:14.319 Um it's only a couple of pennies to you, but we've been able to uh through a volunteer board to distribute five million dollars in community safety projects. 00:26:14.880 --> 00:26:16.559 That's going very, very well. 00:26:16.720 --> 00:26:20.640 You know, the community education uh grants and scholarships we're able to provide. 00:26:20.720 --> 00:26:26.240 I've, you know, it's been fun to see how those have have benefited students for years to come. 00:26:26.480 --> 00:26:34.240 And then I mean, just on our base business model too, I will say that I'm really optimistic about the way that we are planning for the long term. 00:26:34.480 --> 00:26:47.039 I think uh the fact that Flathead Electric, you know, did make that natural that announcement about the natural gas facility, very, very big deal for uh the future reliability and affordability of the electricity serving the area. 00:26:47.279 --> 00:26:59.200 You know, ensuring that we've got access to that generation when we need it at a cost that is, you know, known and will provide some long-term cost stability brings me a lot of hope for the future. 00:26:59.279 --> 00:27:02.319 And I'm really proud of the co-op, frankly, for making that decision. 00:27:02.480 --> 00:27:06.799 And then, you know, there are other investments that uh that we're looking and I'm at and making as well. 00:27:06.960 --> 00:27:13.599 You know, we've I feel a lot of questions about concerns around natural gas in general from a carbon emissions standpoint. 00:27:13.839 --> 00:27:20.480 And I would say that uh that there are other excellent investments that the co-op is making in new renewable projects as well. 00:27:20.559 --> 00:27:22.480 And hopefully we'll be able to announce some of those. 00:27:22.640 --> 00:27:29.039 But we've also seen some great investments in local generation through our community solar projects and and some of those too. 00:27:29.119 --> 00:27:33.279 So I think there's a lot that's going really well, even in the face of uh a lot of good energy. 00:27:33.359 --> 00:27:33.839 I like that. 00:27:34.000 --> 00:27:35.039 A lot of good energy, that's right. 00:27:35.200 --> 00:27:35.599 You see that. 00:27:35.839 --> 00:27:41.759 Even in the face of reliability challenges and concerns, we're, you know, working really hard on on all of your behalf. 00:27:41.920 --> 00:27:44.319 So we're future focused, and we appreciate that. 00:27:44.559 --> 00:27:48.480 Well, Katie, thank you for joining us and helping us break down some of these important issues. 00:27:48.799 --> 00:27:52.799 Energy affects every home, every business, and every industry in our region. 00:27:52.960 --> 00:27:56.799 And it's helpful to better understand both the challenges and the opportunities ahead. 00:27:56.960 --> 00:28:02.000 And thanks to all of you for listening to Venture Boldly, the podcast of the Discover Kalispell Chamber. 00:28:02.160 --> 00:28:07.359 If you enjoyed today's conversation, be sure to subscribe and share the podcast with a friend or colleague. 00:28:07.519 --> 00:28:15.039 You can find previous episodes and learn more about the chamber's work to strengthen our local economy at calispelchamber.com. 00:28:15.200 --> 00:28:18.079 Again, that's calispellchamber.com. 00:28:18.400 --> 00:28:20.640 And until next time, venture boldly, everyone.