An Increase in Electric Rates Coming Soon

Tonight, I attended the Lacreek Electric Association's 78th Annual Meeting. I always enjoy these meetings—it’s a chance to see familiar faces, hear about the cooperative’s financial health, recognize this year’s scholarship recipients, and, of course, take part in the door prizes.

Once again, attendees received a $30 voucher for a local restaurant or grocery store within the cooperative’s service area, along with a $20 credit on their May billing statement as a thank-you for attending. This year, Zone 1 (City of Martin) members elected a new board representative, Angie Rascher. All other board members ran unopposed.

General Manager of Lacreek Electric Inc., Josh Fanning, delivers a speech to the members attending the annual meeting (April 23, 2026).

Our rural electric cooperative plays a critical role in daily life. From making our morning coffee to powering irrigation pivots for our agricultural producers, Lacreek Electric Association keeps our communities running. In his address, General Manager Josh Fanning emphasized reliability, stating, “Whenever nothing happens, that is the dream. We are doing our job.” In other words, their success is measured by consistent, uninterrupted service delivered behind the scenes. He reiterated Lacreek’s commitment to providing safe, reliable, and affordable electricity to its 4,279 members across six counties in South Dakota and Nebraska: Bennett, Jackson, Oglala Lakota, Todd, Mellette, and Cherry County.

It’s also always a welcome surprise to receive a capital credit check shortly after filing federal income taxes. This year, the cooperative retired $617,448 in member capital credits and $223,512 in G&T capital credits.

Following Josh’s presentation, Basin Electric Board Member Andy Buntrock discussed anticipated rate increases for 2026. Basin Electric Power Cooperative includes 138 members across nine states, serving approximately 3 million member-owners. The cooperative follows an “all-of-the-above” energy strategy, utilizing coal, wind, natural gas, hydro, oil/diesel/jet fuel, recovered energy, solar, and market purchases so they don’t have “all their eggs in one basket” when providing safe, cheap, reliable energy.

The largest expense for Lacreek Electric is the cost of purchasing power. That cost increased from $7,840,983 in 2024 to $8,511,241 in 2025—an 8.55% increase in just one year. While specific per-kilowatt-hour rate increases were not discussed, the presentation focused on the underlying reasons for rising costs.

Four primary factors are expected to impact 2026 electric rates:

1. Growing demand: Electricity demand within the Basin Electric system is growing at an average rate of 7% annually, requiring investment in new generation and transmission infrastructure, which is more expensive than existing assets.

2. Commodity price variability: Fluctuations in fuel prices affect both operating costs and revenue.

3. Increase in planning reserve margins: Southwest Power Pool regulations now require higher planning reserve margins, increasing capital and operating costs. Based on the presentation, some of these costs may be influenced by growing demand from hyperscale data centers across the region. While these facilities are expected to “bring their own generation,” it remains unclear how much cost will ultimately be passed on to consumers.

4. Investments in reliability: Continued upgrades to infrastructure and efforts to reduce outage durations will add to overall system costs.

Overall, it was an informative evening and a valuable opportunity to better understand the operations of our electric cooperative. It’s easy to take electricity for granted—until an outage during the winter reminds us just how essential it is. I want to thank the Lacreek Electric board members, staff, linemen, and crews for their work in delivering safe, reliable, and affordable power across District 27.

If elected to the State Senate, I will work to keep electricity rates stable and ensure that large-scale users, such as hyperscale data centers, pay their fair share so that costs are not shifted onto local consumers. As energy demand continues to evolve, I will be monitoring closely rate trends and advocating for policies that protect rural communities. What happens beyond our borders does affect us here in Martin and across the small towns in our district.