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Upshur Rural continues strong, sound

By MAC OVERTON

Upshur Rural Electric Cooperative continues to provide reliable electric service at some of the lowest rates in the nation, co-op members were told at their annual meeting Thursday.

Before an audience that filled the auditorium here for the 69th annual membership meeting, General Manager John Dugan and President Frankie King reported Thursday that the co-op continues strong.

About 300 attended, nearly twice the 150 required for a quorum.

Reelected as directors were Curtis Hart, District 7; R. Alan Branham, District 8; and Willie Mae Henderson, District 9. Both Dugan and President Frankie B. King gave reports on the state of the cooperative.

King said that Upshur Rural has a good board of directors, great membership and hard-working employees who come out in heat and cold, wet weather and dry to keep the electric service going. Today it’s a $121 million business, which compares with a co-op capitalized at less than $10,000 when it was started in 1936.

Dugan’s report covered operations during 2006. He said that the co-op constructed 87 miles of new line in the 10 counties in which Upshur-Rural operates.

“This 87 miles of new line was to connect 1,620 new services, or members,” Dugan said. “That’s a busy year.” “At the end of 2006, there were 42,298 accounts billed for an annual billing of $67,379,073,” Dugan said. “There were 287 miles of transmission line and 5,598 miles of overhead distribution line and 222 miles of underground distribution line in place.”

He said that the total plant investment is $129,812,809. There were 837,799,143 kilowatt hours sold in 2006, compared to 815,668,296 the year before, an increase of 2.71 percent. Capital credits were allocated from 2006 margins to each member’s account using a factor of 6.8 percent on residential accounts.

“The cooperative’s equity position was 68.3 percent at year-end,” Dugan said. “This strong position allows the board of directors to analyze the financial position regarding the retirement of capital credits.”

He said that after bankers’ permissions were received, the board directed a retirement of capital credits of about 2.22 percent, or about $1,770,000.

This retirement has been done for 20 years in a row, Dugan said, adding that it was a decision not easy for the board to make, but one that it is very proud of.

Dugan said that the Gilmer-based co-op’s rates continue to be among the lowest in Texas.

“If you took an average August 2006 electric bill, Upshur’s was $80.82 for 1000 kWh, while surrounding utilities were $82.24 and one as high as $202.07, but remember, URECC paid back capital credits,” Dugan said.

Dugan said there were 86 full-time employees at year end. “We are currently at 87, with four DE students,” Dugan said. “They worked 185,179 hours of regular time and 18,467 hours of overtime for a total payroll of $4,335,973.”

President King pointed out that this is Upshur Rural’s 70th year in business.

“The mission of the cooperative during that first year of business was to provide the members with a reliable low-cost source of energy. After 70 years, the mission of Upshur Rural is still the same,” King said.

He pointed out that customers of some investor-owned utilities pay nearly 14 cents per kilowatt hour, while Upshur Rural members pay just over 7 1/2 cents per kilowatt hour.

“Some of our fellow Texans would say “that’s a bargain,” he said.

He also discussed energy cost and demand on natural resources.

“There is no way for the electrical industry in the U.S. to meet the electrical demand we have using only renewable sources of energy,” he said. “Whether the environmentalists or the mayor of Dallas like it or not, we are going to have to rely on coal and even nuclear energy to meet the growing demand here in the U.S. and globally.”

King suggested consumers could become part of the solution by using more fluorescent lighting, more energy-efficient homes and appliances, and setting the thermostat higher in summer and lower in winter.

As far as energy generation is concerned, King said that “in the short term, we must continue to rely on coal-fired plants, and someday, even more nuclear energy. In the meantime, providers of electricity must maintain a diverse portfolio of coal, gas and renewable sources, which is exactly what we are doing here at Upshur.”

He said that Upshur Rural tries to control all the costs it can, and by being efficient, is able to service about 42,000 meters with the same number of employees it had 10 years ago with 32,000 meters.

Thirteen meter-reader positions were eliminated by using meters that automatically report the reading. Service men now have bucket lifts, so that only one man, rather than two, needs to be in a service truck.

He told the members that “on top of that, our management and board are just plain tight with your dollars. I tell people that if you ever have a dollar bill in your pocket and George Washington’s eyes are popped out, that dollar at one time probably passed through Upshur Rural.”

King reiterated that “today, Upshur is a very strong and financially sound cooperative.” He credited all the employees working together for making it and keeping it that way.

Homeward Bound group played for entertainment during registration, which started at noon. As members checked in, they were given “goodie bags” containing, among other things, a 26-watt fluorescent light bulb which emits as much light as a standard 100-watt bulb.

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