Treasurer’s Report 2024 – By Don Douglas, Treasurer
The net margins in 2024 were $868,465, which is nearly $200,000 less than 2023, but is still sufficient to satisfy our lenders’ loan covenants.
In 2024 Washington Electric Cooperative recognized an increase in revenue of $534,265 from the previous year. Sales of renewable energy credits (RECs) were $1,882,175 which is also down from the previous year by $96,127. This is because there have been some production issues with the Coventry Landfill Gas to Energy (LFG) facility, not because the market for the RECs has been lower than expected. WEC is addressing the production issues and expects to have some new equipment installed in the spring of 2025.
Purchased power is also higher than our budget. This is because KWH production was down at the LFG plant in Coventry. The net margins in 2024 were $868,465, which is nearly $200,000 less than 2023, but is still sufficient to satisfy our lenders’ loan covenants.
From the charts, the percentage of MWH produced by Coventry LFG has decreased from nearly 65% to about 60%, while the Hydro-Québec MWH has increased from 8.6% to 14.19%. This reflects the decrease in the LFG production but mostly is from the additional MWH WEC is getting from the Hydro-Québec contract.
Outages were again significant in 2024. The flooding in the summer caused extensive damage, and in some cases roads needed to be rebuilt in order to restore service. WEC may borrow from our line of credit after large storms if needed. FEMA reimbursement money comes for storms that cause enough damage to qualify, but it is many months in process as it requires extensive documentation and review by FEMA. Meanwhile, the interest on the borrowed money is not recoverable in our rates which had an effect on our bottom line in 2024.
In 2024, WEC decided to pursue selling the Wrightsville hydro plant. It was a difficult decision for us. For many years the hydro plant has operated at a loss or at a very marginal benefit. Selling a renewable resource was a difficult decision. There are several levels of approval which must be obtained before the sale is complete, and it is not clear yet if that will come to pass, or if WEC will continue owning the plant. It is still in operation and generating power when conditions allow.
Capital credits are a unique feature of electric cooperatives. The investor-owned utilities take the money in excess of operating costs as profits, which are returned to the stockholders who own the company. In the case of the large investor owned utility (Green Mountain Power) in Vermont, the profits are returned mostly out of Vermont. Our capital credits are held by WEC for many years, but at least they stay in Vermont and they are returned to current and former members. The Board of Directors decides each year how much to retire from the money held in each member’s account. Last year we recommended a conservative retirement because we were nervous after two years in a row with December storms costing in excess of $1,000,000 and because our new loan from Rural Utilities Service (RUS) was delayed. You might have noticed in your November bill the credit was smaller because we decided to retire a smaller amount than in previous years’ retirements. In 2024, WEC retired a total of $290,987, and since 1998, WEC has returned close to $10 million to members.
We invite our members to donate their capital credits to the WEC Community Fund, which provides grants to many nonprofit organizations who serve people in some or all of the four counties served by our Cooperative. This is a great way to make a real difference in your community. About 14% of our members donate their capital credits. For more information please call the WEC office at 802-223-5245 or visit wec.coop/CapitalCredits.
On behalf of the Board of Directors, I want to thank the entire Finance Department for their hard work and dedication to Washington Electric Cooperative.