CEO’s Report: Adding value through economic development
As you know, Heartland offers a variety of economic development incentives to promote growth in the communities we serve, from rebates on electric bills to hiring incentives to grants to help utilities prepare for development.
Some may wonder why an electric utility offers economic development programs. The answer is two-fold.
First, part of our vision at Heartland is adding value to the communities we serve. Second, what’s good for one Heartland customer community is good for all.
The addition of a large load such as Prairie AquaTech has a tremendous impact. The city of Volga will see an increased tax base, the creation of jobs, and other local businesses will benefit from increased foot traffic and sales. The school will benefit from the increased tax revenue and additional enrollment. New houses will need to be built and existing homes will increase in value.
A local welding shop, hardware store or bakery provide essential services, meaning more money is spent locally, in turn increasing the tax base. They also create jobs, keep families in town and create the need for housing.
The benefits listed, and more, are all adding value to a community. They lead to increased qualify of life for citizens and a sustainable future. We are proud to partner on economic development projects of all sizes, from Main Street businesses to large industrial loads, to help communities succeed.
It is also Heartland’s vision is to provide competitively priced electricity. We are better able to do that when we have adequate load to match our resource generation.
Any business is going to be more successful the more product it sells. If you’re producing widgets, you want to sell as many as you can to earn more profits. By producing more, the cost per widget typically goes down.
Basic economies of scale are achieved by increasing production and lowering costs. This happens because costs are spread over a larger number of goods.
Electricity is no different. Increasing our sales in one customer community means a larger base over which costs are spread resulting in a lower average cost per megawatt hour.
While this may be a simplified explanation, the basic premise applies. It is Heartland’s goal to provide electricity at the lowest cost possible, and economic development is one way to do that.
Incentives are often the difference between a company choosing a Heartland community over another. Helping them cut costs for the first few years of operation gives them time to gain footing and prepare for future success.
Heartland also strives to be a partner of choice. Whether that is to our customer, to local businesses or to local banks in helping provide financing to those local businesses, we want communities to know they can count on us to help them in any way possible.
Heartland also seeks out partnerships that will benefit our customers. For example, we work with USDA to pass on low-interest financing to businesses. We also work with private enterprises to provide much-needed services to cities such as long-term planning.
You can learn more about some of these partnerships at our upcoming Summer Conference on July 17th. We have other great speakers lined up including the mayor of Sioux Falls, legislators who will participate in a panel and a local businessman who will share his local economic development success story.
You will also hear more about Heartland’s programs, which are designed to help businesses, no matter the size, get off the ground, for the betterment of the community in which they’re located, and for the betterment of all Heartland customers.