May 1, 2010
Contacts:
Chris Tryba, Hoosier Energy (812) 876-0337
Rick Moore, Hoosier Energy (812) 876-0282
2010 Hoosier Energy Annual Meeting
Cooperatives work together to create member value
The cooperative business model has worked for more than 70 years and will serve consumer needs well in the future, says Hoosier Energy President and Chief Executive Officer Steve Smith as he addressed southern Indiana electric cooperative directors and managers, business partners and guests during the power supply cooperative’s 2010 Annual Meeting.
"Among the many lessons I’ve learned is the resiliency of our cooperatives – the ability to adjust to changing circumstances while staying on track to create member value," said Smith as he reflected on the power supplier’s accomplishments over the past decade.
In the past 10 years, the electric utility industry witnessed the collapse of Enron and its effect on wholesale power markets, an East Coast blackout that heightened awareness of reliability issues, energy cost volatility in the aftermath of Hurricane Katrina and the development of the Midwest Independent System Operator (MISO) to oversee the regional power grid.
Hoosier Energy built a solid record of progress over the decade, Smith noted. Jackson County REMC and Wayne-White Counties Electric Cooperative joined the power network. Member sales grew by 50 percent – about twice the growth rate of other utilities.
"We added almost 900 megawatts of resources, a 70 percent increase in capacity," Smith said. “In 2000, we had 1,200 MW of capacity, all baseload and all coal-fired. Today’s more than 2,100 MW of capacity includes baseload, intermediate and peaking units that better match member load.
"More than one third is fueled by natural gas or renewable resources,” Smith said. “Diversity reduces fuel, outage and carbon risks, and reflects renewable targets."
Hoosier Energy invested $840 million in assets over the decade including $630 million in new plants or plant upgrades, as well as $200 million in transmission and substation improvements to support growth and reliability. A substantial share of the investment went to environmental controls that reduced emissions by 40 percent. More environmental costs are expected.
"Federal policies define our industry and decisions as never before," Smith said. "Nothing will impact rates like federal decisions on emissions, carbon and renewable energy. Unfair and unaffordable cap and trade legislation was proposed last year."
Company-wide process improvements have improved availability and production, reduced costs, extended plant life and provided better ways to organize and manage work, Smith said. He credited "outside-the-box" thinking with a focus on least-cost for members with helping to successfully navigate tough issues and big challenges in a time of unprecedented uncertainty.
"We end the decade with strong credit ratings, manageable debt, low interest costs, and growing value returned to members through competitive rates, services and patronage capital," Smith said.Roberts recognized for service as chairman
Eugene Roberts, who represents Orange County REMC on the board, was recognized for his two years of service as Hoosier Energy board chairman.
"Eugene brought leadership, insight, a calm demeanor, and great communications skills to the chairman’s position," said President and CEO Steve Smith. "It’s been my privilege to work with Eugene in that role."
Vice Chairman Dale Walther, who later in the day was elected to the position of chairman, presented Roberts with a plaque recognizing his extraordinary service to Hoosier Energy.
"He has shown leadership and a clear commitment to the power of cooperation as our industry has undergone changes," Walther said. "I know he’s especially proud of our work to improve power reliability and renewable energy resources, maintain a solid financial conditions in tough economic times, and carry on a commitment to employee safety and the environment."
New directors joining the Hoosier Energy Board are John Trinkle of Jackson County REMC and Steve Dieckmann of Decatur County REMC.
