The Board reached a decision. . .

The Osage Valley Electric Cooperative (OVEC) board of directors approved a general rate increase that will go into effect for its members in the spring of 2008.

Effective with the March 1st, 2008 billing, OVEC will raise its rates an average of 16.1%. Commercial rates will also change and vary based on usage and current rate classifications.

This rate change continues what the Cooperative board has been informing the members at the annual meetings and through articles in the Rural Missouri magazine about. The cooperative is going through a time in which we are probably going to be adjusting the rate on a regular basis. The board of directors will make every effort to make the adjustments as minimal as possible.

The March 2008 rate change marks only the second rate increased for OVEC members since 1989. The cooperative has absorbed part of the increase that we received from Associated Electric Cooperative (AECI), our power supplier, but we were forced to take action when we received word from our power supplier that another increase in the power bill was going to occur in the spring of 2008.

OVEC staff worked with Toth & Associates of Springfield, Missouri, a company that specializes in rate studies, before taking a proposal to the cooperative's board of directors at the November board meeting.

One reason for the rate increase from AECI was due to new EPA regulations that will be costing hundreds of millions of dollars to install and operate now and well into the future. Additional increased costs for coal, transportation and natural gas were also factors in the rate increase to the cooperative from its power supplier. Also a factor is reduced hydropower availability, as a result of the current drought conditions.

New environmental standards require compliance from all electric utilities. Environmental expenses to the cooperative-owned power plants at Thomas Hill and New Madrid, as well as the new power plant will easily top the $500 million mark. Since the early 1990's and including this latest round of environmental expenditures, AECI will have spent well over $1 billion to improve air quality in Missouri.