Many people in our community are facing challenging times, and no one wants to see rising electric bills. We recognize our responsibility to work to keep bills as low as possible and have worked hard to manage our costs.

On March 26, 2026, Stearns Electric’s Board of Directors approved a 3.3% rate increase effective May 1, 2026. The 2026 adjustment will affect members differently based on usage and rate class.

Electric cooperatives like Stearns Electric are not-for-profit, meaning we work toward a zero-based budget by the end of each year. However, projections for 2026-2030 indicate that the Cooperative needs an increase in revenue to continue providing our members with the reliable electricity you depend on.

We want our members to understand what goes into their bill and why bills are increasing. You can read further on in this document for details on the specific driving factors of the rate increase and how it was determined.

Stearns Electric is facing sustained cost pressures that are largely outside the Cooperative’s control. Wholesale power − our single largest expense − continues to increase as Great River Energy invests in transmission infrastructure needed to maintain long term reliability. At the same time, inflation is driving up the cost of equipment, materials, trucks, tools and personnel costs, while energy sales growth has not kept pace with those rising costs.

Even with aggressive cost saving measures and operational efficiencies, these combined pressures mean a rate adjustment is necessary to keep the Cooperative financially stable and able to provide safe, reliable service.

Like many of the members and businesses we serve, Stearns Electric’s finances and operations have been significantly affected by the rising costs of equipment, materials and services. For example, the price for key pieces of our distribution infrastructure such as poles, wires, transformers and meters has risen by as much as 50% over the last two years.

While Stearns Electric’s membership continues to grow, that growth has slowed over the past decade, which limits overall energy sales. At the same time, we are still responsible for maintaining more than 2,000 square miles of electric infrastructure needed to reliably serve over 29,000 members.

In addition, generation and transmission costs from Great River Energy (GRE) and the Western Area Power Administration (WAPA), our wholesale power providers, have increased, too. These increases are driven by higher power market prices and rising capital costs. Since our last rate adjustment in 2023, annual wholesale power cost increases in 2024, 2025 and 2026 have resulted in a 7.7% increase to members’ bills through the Power Cost Adjustment (PCA).

Stearns Electric’s new Operations Center and Headquarters is not a primary factor of the 2026 rate adjustment. In 2023, the Cooperative added $3 to the monthly Fixed Charge specifically to cover most of the construction cost. The earlier adjustment was intended to pay for the new facility and covered a majority of those expenses. The new Operations Center and Headquarters was planned many years in advance, and despite rising costs, it was completed more than one million dollars under budget.

The 2026 rate adjustment is focused on addressing rising system wide costs and maintaining the long term financial stability needed to continue making ongoing investments in safe, reliable electric service for the future – not funding the new headquarters.

The new Operations Center opened in August 2025 and is already improving efficiency, safety and coordination. Over time, these improvements will help Stearns Electric operate more efficiently and better manage costs while supporting reliable service for our members.

Stearns Electric worked with Power System Engineering (PSE), an independent consulting firm that specializes in helping electric utilities plan for future costs and system needs. PSE completed a detailed Cost of Service study to look at what it truly costs to operate the Cooperative and maintain reliable electric service over time.

The study showed that current revenue is not enough to support day to day operations and the long term investments needed to keep the electric system safe and reliable. Using this information, the Stearns Electric Board of Directors approved a new rate plan they believe best supports the Cooperative’s financial health while treating all members fairly.