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CEO’s Message – April 2021

Moving Ahead Amidst the COVID-19 Pandemic

I would like to say that we are “moving on” from the 2020 pandemic, but I think it’s more like “moving ahead.” Most likely we will not totally return to the way things were prior to the start of the pandemic.

Since the beginning of the pandemic, Stearns Electric has worked hard to provide you with uninterrupted electricity and customer service. Energy utilities like Stearns Electric are considered critical infrastructure. It’s not an option for us to take a timeout and suspend our operations. We need to continue providing electricity to our members no matter what. We know that our residents, farms and businesses count on Stearns Electric to provide reliable and safe electricity, 24 hours a day, 7 days a week.

We are encouraged by both the signs of spring and improvements being made to the pandemic situation and related restrictions. Vaccinations are being rolled out and vulnerable populations are getting vaccinated. We now have an increased ability to gather and travel. Plus our kids are heading back to school for in-person learning, social time and youth sports. The world, much like the Minnesota spring, is starting to awaken, and we are more than ready. Spring is when Stearns Electric starts to really ramp up our construction season. Our planning is complete and we are anxious to begin the new season of work.

Every couple of years, Stearns Electric develops a construction work plan. That work plan identifies the budget for several years, highlighting replacements and upgrades for Stearns Electric to accommodate our distribution system needs. In 2021, Stearns Electric plans to spend just over $7 million on our utility plant. Most of these dollars will be spent on new services, and cable or conductor (wire) replacements and upgrades. Other projects include substation and line equipment upgrades and replacements. With $124 million in electric distribution system assets, Stearns Electric is consistently replacing and upgrading conductor, poles and equipment to ensure we continue to deliver reliable energy to our members.

Another large project and goal we have planned for this year includes the continuation of our Right-of-Way (ROW) clearing program. Last year we wrapped up our initial 4-year ROW cycle. In 2021, we start a new cycle, which really focuses on maintaining all of the work we have accomplished clearing trees out of power lines over the last four years. The work has led to a 62.4% overall decrease in tree-related outages for Stearns Electric members.

Additionally, we will wrap up our three-year security and street light LED replacement project. Once this project is complete, the Co-op anticipates a 66% total decrease in energy use for security and street lights throughout our service territory. We also plan to explore digital staking technology for our engineering department, initiate our single-phase bare concentric wire replacement plan and conduct an arc flash study. This study aims to keep our line crews knowledgeable and safe while working on our distribution system into the future.

In March, Stearns Electric staff members provided our board of directors with an update on Stearns Electric strategic initiatives. Two important initiatives discussed were the Stearns Electric equity plan and our electric rates. In 2020, Stearns Electric developed a long-term equity plan. This was a lengthy, but important process. Through it, we identified our cash needs for Capital Credit retirements, wholesale power purchases and overall Cooperative operations. We know that electric rates, and the associated value, are very important to you. Stearns Electric’s last rate increase was in 2018. Great River Energy (GRE), our power supplier, has announced that they will not have any wholesale power rate increases for several years. Wholesale power is Stearns Electric’s number one expense year over year. Since we don’t anticipate any wholesale power cost increases, Stearns Electric will most likely not have a rate increase for the foreseeable future.

I for one am really looking forward to spring! Farmers in the field, birds chirping and warm breezes are just around the corner. Please know that we at Stearns Electric will continue to work hard to maintain competitive rates and provide you with reliable and safe electricity.

Sincerely,

Robin C. Doege
CEO

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