PIERRE, S.D. (KELO) — East River Electric Power Cooperative could lose one of its member cooperatives.
Officials from Dakota Energy Cooperative announced Friday afternoon they had filed a lawsuit to leave East River. They didn’t say where they want to go.
Dakota Energy Cooperative serves about 2,250 member-owners, mostly in Beadle, Hand and Hyde counties.
Dakota Energy operates from Huron. East River is based in Madison.
Price is the reason, according to a statement from Dakota Energy. It said electricity prices under East River have been “high and unpredictable. While market prices for electricity have decreased, Dakota Energy has sustained 12 rate increases from 2005 to 2019 under East River.”
Electricity frequently is priced by kilowatt-hour. Dakota Energy officials said their co-op is paying 6.86 cents per kWH, double the 3.24 cents 15 years ago.
“Across America, the generation and transmission model is being challenged by the distribution cooperatives who own them. We want more flexibility and local control to help us manage and even reduce costs,” said Garry Dearborn, Dakota Energy Board president.
He continued, “As the energy landscape continues to quickly change, we need to be able to plan for a future that truly benefits our member-owners. East River’s effort to imprison its own member-owners violates the bylaws and serves only to benefit those whose bad business decisions got us here in the first place.”
Chris Studer, a spokesman for East River, said Friday night the relationship with Dakota Energy has spanned nearly 70 years since East River was established. Studer said Dakota Energy signed its current wholesale power contract five years ago.
“We don’t know where Dakota Energy Cooperative might seek their wholesale power from if they they leave the East River family of cooperatives, but the lawsuit filed today follows a trend we’ve seen happening across the country to small, local, not-for-profit cooperatives,” Studer said.
He continued, “Out-of-state, for-profit companies are trying to lure cooperatives away from their local cooperative power suppliers to try and make money off them. That’s likely why Dakota Energy has requested to break its contract with East River Electric — to do business with an out-of-state, for-profit company which isn’t good for South Dakota or Dakota Energy’s member-owners.”
The Legislature considered a bill in 2019 that would have changed some of South Dakota’s laws regarding territories of rural electric cooperatives. Lawmakers deadlocked, and a special study committee couldn’t resolve it.