Sturm
Johnson County REMC will take on more responsibility for its infrastructure as part of a new agreement with Hoosier Energy.
JCREMC officials announced Friday that the electric cooperative had entered into a new long-term agreement with longtime provider Hoosier Energy. Under the agreement, JCREMC will no longer be a member of Hoosier Energy but will remain a customer through 2045, according to a news release.
Hoosier Energy has been JCREMC’s single power supplier for decades. Moving forward, JCREMC will take on additional responsibilities such as managing substation assets, arranging portions of its power supply needs and self-providing various additional services previously provided by Hoosier Energy, officials said in the news release.
“When we began discussing the change in relationship, JCREMC’s goals were to retain more local decision-making authority and expand our flexibility with power supply decisions,” said John Sturm, CEO of JCREMC, in the news release. “Hoosier Energy has been an important partner for JCREMC since 1960, and with the new arrangement, they will continue to be a long-term strategic partner.”
Sturm told the Daily Journal the new agreement kind of “begin[s] a new era” for JCREMC and the company “started diligently evaluating this” five years ago. The main reason for the change is that it will allow JCREMC to have more flexibility and local control over managing their wholesale energy costs, he said.
Customers will benefit from the change because JCREMC will have more flexibility in implementing their Intelligent Distribution Grid of the Future, which helps save on energy costs, Sturm said. The distribution grid shows how the company strives “to increase resiliency and control on our grid as a whole” and how “members can optimize their share of” the electric grid, according to the website.
The change will also help the company improve its reliability and create programs where JCREMC saves on wholesale energy costs and can pass those through to participating members in all the rate classes.
“Because as a nonprofit cooperative, we directly pass through our wholesale cost into our retail rates. So anything that we save in wholesale energy cost directly flows through to the members in their rates,” Sturm said.
Hoosier Energy will remain as a power supplier to JCREMC and JCREMC will source portions of its power supply need from other sources.
“Hoosier Energy and JCREMC took a collaborative, cooperative approach and achieved a mutually beneficial agreement,” said Donna Walker, president and CEO of Hoosier Energy, in the news release. “The process has been very positive, and I appreciate the thoughtful engagement by our board of directors, member CEOs and staff involved to get us to this point.”
Although JCREMC will still be subject to wholesale energy price pressures like they were in the previous agreement, Sturm said JCREMC will have more control over managing any of those future pressures. In the past under the old agreement, he said Hoosier Energy would experience those pressures and pass them through to JCREMC.
Sturm said the change sparks excitement and opportunity for the company.
“I just think it does kind of begin a new era for us and it’s going to provide a lot of excitement internally for our staff and opportunities ..,” Sturm said. “We’ve implemented a lot of [the Intelligent Distribution Grid] and that just demonstrates the innovation that we have here, and we just see this as an opportunity to continue in that positive, innovative trend for our members.”