Higher supply costs trim margin for Hood River Electric Co-op members

By Stu Watson

Members Dave Waller, left, and Ken Tatyrek enjoy plates of apple pie and ice cream after Hood River Electric’s 70th annual meeting.
Members Dave Waller, left, and Ken Tatyrek enjoy plates of apple pie and ice cream after Hood River Electric’s 70th annual meeting.

According to one person among the many attending Hood River Electric Co-op’s 70th annual meeting, there were two main reasons most people show up.

No, it wasn’t the audit and legal reports. It was the prizes and the pie.

“That’s about what most people come for—the raffle and the pie,” member Ken Tatyrek said with a smile.

There was plenty of each. As one might expect, many of the prizes came with a plug or a battery.

The pies were crafted mainly with local fruit. HREC Board President Butch Gehrig was happy to dress each piece carved from 44 pies baked by the women of the Parkdale Grange with a scoop of vanilla ice cream.

The event featured a few other milestones. Longtime attorney Meredith Van Valkenburgh told the room this would be his last meeting.

He said co-op manager John Gerstenberger “keeps us out of legal problems. There’s not much for me to do.”

Van Valkenburgh said he was not enjoying the aging process, but assisted by attorney James Habberstad, was able to continue some duties.

“It has been a real privilege to represent you,” Van Valkenburgh said, to a standing round of applause.

Following an audit report by Nate Reagan of the accounting firm Friend & Reagan—he said the co-op was operating “lean and clean”—Gerstenberger brought patrons up to speed on operations and the road ahead.

He said anticipated Bonneville Power Administration price bumps of 6.4 percent for power and 1.5 percent for transmission would boost expenses by $270,000 a year.

As a result, he said year-end margins would whittle back to about $400,000— the lowest value in about 10 years— after dipping from $887,923 in 2014 to $608,725 in 2015.

Gerstenberger said he might need to recommend a rate adjustment if expenses track higher than revenues during the next year. In the past year, revenue from large commercial customers jumped 2.9 percent, while residential use dropped by 3.3 percent.

Gerstenberger attributed that shift to the warm winter of 2014-15 and the high temperatures during the summer of 2015, which accelerated harvest times and created greater demand for storage cooling.

Longtime HREC counsel Meredith Van Valkenburgh tells members of his plans to retire. Board President Butch Gehrig sits to his left.
Longtime HREC counsel Meredith Van Valkenburgh tells members of his plans to retire. Board President Butch Gehrig sits to his left.

Gerstenberger applauded Rep. Mark Johnson (R-Hood River), and Sen. Chuck Thomson (R-Hood River) for helping push through legislation that blunted a proposed initiative forcing utilities statewide to quickly shift away from power generated by coal-fired plants.

“It didn’t make sense to include us in a carbon reduction bill when we are 95 percent carbon free,” he said.

Gerstenberger also shared positive news about HREC’s affiliated Internet service partners, the Communications Access Cooperative and the regional LS Networks. He said that after 10 years in operation, CACHE serves 1,800 customers with revenues last year of more than $1 million.

Because CACHE and HREC share some personnel, Gerstenberger noted CACHE reimbursed HREC about $375,000 in staffing costs last year.

Without divulging details, Gerstenberger told attendees several active business initiatives will benefit both companies.

In board elections, members Patrick Moore, John McGhee and Doug Mahurin ran unopposed to serve again.

Gerstenberger noted the retirement of Chuck Weseman after 36 years on the job. Clinton Curtis, with 25 years of time under his belt, ably stepped into the role as operations manager. Dave Porter takes over for Curtis as crew foreman.

HREC members Carole and Kevin Doherty reminisce about Kevin’s work as a millwright.
HREC members Carole and Kevin Doherty reminisce about Kevin’s work as a millwright.

As members dispersed and headed to the pie tables, first-time attendees Kevin and Carole Doherty reflected a bit on Kevin’s years of work helping put power in the lines.

Before retirement, Doherty worked for three years as a millwright on generator turbines at the John Day Dam. He did similar work for Portland General Electric and the Northwest Aluminum plant in The Dalles.

He shared a chuckle later with Gerstenberger about people who claim to use only green power.

No matter the source, they agreed that once that juice is in the grid, it is all just electricity to the end user.

As many at the annual meeting would agree, a pie baked with green power tastes just as good as one baked with the old-fashioned variety.