PIERRE, S.D. (KELO) — A Huron-based rural electricity provider intends to buy power from a Colorado company, if it’s allowed to sever a contract with East River Electric Power Cooperative.

Dakota Energy Cooperative has filed a lawsuit in South Dakota circuit court in Lake County against Madison-based East River.

Basin Electric Power Cooperative, headquartered at Bismarck, North Dakota, produces and sells electricity to East River.

East River in turn resells electricity to 24 local cooperatives who supply rural customer-members in eastern South Dakota and western Minnesota, including Dakota Energy.

According to the lawsuit, Dakota Energy was formed in 1995 from two then-existing cooperatives who were East River members. They were Beadle Electric Cooperative and Ree Electric Cooperative.

Dakota Energy’s board passed a resolution in 2018 seeking to buy out its wholesale power contract with East River. The contract currently runs through 2075. East River claims Dakota Energy can’t withdraw.

The Dakota Energy lawsuit raises two issues: Do East River bylaws permit Dakota Energy to withdraw? If so, what is the amount of an equitable exit charge that Dakota Energy must pay to discharge its contractual obligations to, and withdraw from, East River?

Dakota Energy’s letter of intent is with Guzman Energy, based at Denver, Colorado. In announcing the lawsuit Friday, Dakota Energy officials said East River doubled its prices in the past 15 years. Guzman Energy markets itself as a way to save money.