By Zac Perkins, CEO
Every electric utility has rules governing costs for the construction of new infrastructure for consumers. TCEC calls this set of rules “contribution to construction” and it’s one of the costs we are frequently asked about.
An example of when contribution to construction costs would apply is a member building a new house where electric service has not existed previously. That person will need new electric service and it will require construction costs.
Part of the cooperative business model is that members contribute equitably to the capital of their cooperative. The cooperative’s Rules and Regulations of Service outline the member’s and the cooperative’s relative financial contributions toward meeting the member’s request for additional service.
TCEC requests a contribution to construction when a member asks for a change to the electrical system that primarily benefits them and does not specifically benefit other members. Seen from the other members’ vantage point, it would not be fair to spread these costs among all members when the benefit accrues to only one member.
The cost of expanding the distribution system to accommodate the changing needs of a member may seem high, but TCEC makes every effort to minimize the financial burden on the member requesting new service. In the end, TCEC has the responsibility for building and maintaining the electric distribution system. TCEC must also ensure that the electric system meets cooperative and electric industry standards. Although the member’s contribution to construction may seem high sometimes, TCEC must build an electrical system that lasts over the long haul and can be efficiently and effectively maintained. If a storm tears down the system, TCEC restores it. TCEC only charges for the cost of the project. There is no margin (profit) made on construction. If TCEC overestimates the cost, the overage will be returned to the member.
To speak to us about your new construction needs, please contact TCEC at 580-652-2418.