CEO’s Report: State Legislative Sessions kick off, begin planning for new year

Turning the page on a new year often brings reflection on the past year and resolutions for the new.

While many were happy to slam the book on 2021, as I look back, I see a lot of positive things we can be grateful for. We were finally able to meet in person again, bringing customers together for educational opportunities. We once again announced steady rates, served our communities proudly and aided in the growth and development of those communities.

As we look forward to 2022, we look forward to accomplishing all those same feats and more. We will hold a planning session in January with our board of directors to set goals for the new year and discuss strategies to best serve our customers.

With the start of a new year also comes the start of new state legislative sessions. Many state coffers look different this year as many ended the last fiscal year with a large surplus. As the legislative sessions get underway, legislators will have decisions to make as to how to best and most responsibly allocate funds.

Below are brief overviews of each state in which Heartland serves customers as the new year starts off.

exterior of Minnesota Management and Budget Office

Minnesota

The Minnesota Management and Budget Office (MMB) recently released its November budget forecast revealing a $7.7 billion surplus for the state. With this news, groups are already lining up with requests for state investments. Amongst these requests, action to address the increasing cost of energy, including energy assistance, has frequently been listed as a top priority for both Republicans and Democrats.

Senate Majority Leader Jeremy Miller was recently quoted saying“The budget surplus gives our state a lot of options to make the lives of Minnesotans more affordable. With inflation, increasing energy prices, and continued economic hardship, it’s more important than ever for us to partner together to make sure families have the resources they need to thrive.”

For several years, the legislature has been vehemently divided on energy policy. However, during the 2021 legislative session, the two parties were able to come together and pass a compromise energy package that protects both industry and consumer interests. Following passage, House Speaker Melissa Hortman said, “Our Commerce & Energy budget takes strong steps to protect Minnesota consumers and student loan borrowers and grow our clean energy economy.”

DFL controlled House and GOP controlled Senate still have stark differences on energy policy, but the work in 2021 could be a positive sign of diplomacy. Leading into the 2022 legislative session, Democrats continue to focus on climate change and investing in sustainable and renewable energy sources, while Republicans aim to provide energy security and reliability via more traditional sources. Although they will have different approaches to solve the issue, both sides will be looking to address rapidly increasing home heating costs.

The Minnesota State Legislature convenes January 31.

exterior of south dakota state capitol

South Dakota

South Dakota ended the 2021 budget year on June 30 with a surplus of $85.9 million. Total general fund revenue for fiscal year 2021 finished $62 million higher than adopted estimates, and the state general fund budget ended with expenditures approximately $23.9 million lower than budgeted.

In her budget address December 7, Governor Kristi Noem highlighted South Dakota’s strong economy and resulting strong revenues. She advised the legislature that there are $215.5 million in one-time dollars for fiscal year 2022 and $157.6 million in ongoing general funds. The state also has American Rescue Plan (ARPA) dollars from the federal government available.

Governor Noem highlighted several key funding initiatives to invest in South Dakota’s workforce, build infrastructure for the future, and strengthen public safety.

Of note, investments in South Dakota’s workforce as laid out by Noem include $30 million to facilitate new cybersecurity training at Dakota State University, $200 million in workforce housing, and $17 million to enhance workforce training capacity at the state’s technical colleges.

The South Dakota Legislature convenes in Pierre January 11.

exterior of iowa state capital

Iowa

Iowa Governor Kim Reynolds said their state closed FY2021 with a general fund surplus of $1.238 billion. That amount is $751 million more than the prior estimate of $487 million, according to the Iowa Legislative Services Agency.

Reynolds touted the surplus and repeated her pledge to follow up on a wide-ranging tax cut she signed into law this year with further cuts.

“We will continue to cut taxes in Iowa,” she said. She’s previously said Iowa will look at lowering individual income taxes next year.

Reynolds told a public hearing on the state’s fiscal 2023 budget: “I looking forward to working with the Legislature to pass generational tax relief which I believe we have the capacity and we absolutely should be moving in that direction. We’re going to come (this) year with a comprehensive, ambitious tax plan that will really make Iowa competitive and I think really help spur economic growth in the state of Iowa, so I’m really excited about that.”

The Iowa Legislature gets back to work January 10.

exterior of nebraska state capitol

Nebraska

The 60-day Nebraska state legislative session kicks off January 5. Like other states, Nebraska will be sitting on a large pile of pandemic relief and infrastructure money.

The State of Nebraska utilizes a biennial budget for revenues, appropriations, and expenditures. Anticipated state tax revenue exceeds projected state spending during the current two-year budget cycle by more than $400 million and $1 billion dollars in federal pandemic recovery funding awaits one-time investment and distribution.

Allocation of the pandemic relief package will be decided by the Legislature after Gov. Pete Ricketts weighs in with his recommendations. 

An additional $3 billion in federal infrastructure funding will be available for highway construction, bridge repair, expansion of rural broadband service and other purposes, with $2.5 billion of that total targeted to roads.

As always, Heartland will continue to monitor legislation in all states we serve customers and keep you apprised of any developments. Here’s wishing you health and happiness in the new year.

CEO’s Report: There when you need us

Heartland staff recently met with some economic development folks to explain our programs to promote growth in our customer communities.

The underlying theme throughout our presentation: call us.

Heartland has a small staff. We certainly aren’t experts on everything, but we are on quite a few things.

Needless to say, I am incredibly proud of the people working at Heartland. If they don’t have the answer to your question, they will find it. And quickly.

It’s no secret we strive to be more than a power supplier. While that is certainly the focus of our operations, we also want to be a partner to our customers. We want to help your communities grow and see them prosper.

A dedicated partner

Heartland is dedicated to providing reliable, affordable wholesale power. But we also provide a variety of other services, including market services expertise, economic development and community support programs, and advocacy, to name a few.

We look out for the future of our customers. We also build relationships with industry professionals to ensure if we don’t have the answer to your question, we know somebody who will.

The idea of going above and beyond is at the core of who we are as a company, of who we are as people. While some call it customer service, we call it doing our jobs.

Our vision to be a trusted leader and partner of choice are more than words to us.

The simple point I’m trying to make, is we’re here to help. If you have a question, pick up the phone and give us a call. No issue is too big or too small. We’ll find the answer.

Programs to help you succeed

Heartland offers various programs and tools to incentivize businesses to locate in one of our customer communities. We also offer tools to help current businesses and residents save money by making efficiency upgrades.

We want to make sure all our programs are well-known, hopefully tipping the scales in a customer’s favor.

While we try to keep our programs simple, there can be a lot to remember. Don’t ever hesitate to ask questions. We want our programs to get used – that’s what they are there for. We can also speak with a prospect or business directly if you’d like.

We also recognize that electricity is a complicated matter. Particularly for large businesses, electricity is an important factor when choosing a location. If they have questions you can’t answer either about the available service or rates, give us a call. We are here to help.

The important thing to remember is to bring us in early to the conversation so we can offer the best information possible and work with you to ensure the business is getting the best deal.

Call us

The takeaway from this article is simple: call us.

We are here to help. Hiring consultants or other third-party organizations can be expensive. Start with us. While we can’t provide every service needed, we can answer questions and help determine the best route to take to resolve an issue or chart a path forward.

The values of honesty, reliability and leadership are at the core of our operations.

You can count on straightforward information, and we will be there when you need us. We will follow through on our promises and take the lead in advocating on your behalf.  

CEO’s Report: Meeting customers’ needs

With COVID-19 controlling what most of us did throughout 2020, there wasn’t as much opportunity to interact with customers as we’d like.

Now that many activities and events are returning to normal, we once again can meet in person and connect.

Annual Meeting offers valuable tools, insight

Heartland is excited to host our Annual Meeting May 12 after cancelling the event last year due to the pandemic.

We have an excellent speaker lined up. Mike Oster grew up in rural South Dakota and uses his many life experiences to speak on leadership, teamwork, and motivation.

While not everyone may see value in these topics, I challenge you to think again.

We all serve in leadership positions. All too often the words leadership and management get confused. All managers are not leaders and all leaders are not managers.

Anyone can be a leader, no matter your position. Maybe there is something in your community you’d like to see happen, or an idea you want to come to fruition. It takes leadership to get things done.

Successful communities are full of leaders who turn ideas into reality.

Leaders are excellent communicators. As a public power utility, you interact with consumers every day. While not all those interactions are positive, Mike provides tools and resources to make them more meaningful. The idea is to help build positive relationships through more effective communication.

I encourage you to take a day from the office to listen to Mike. I guarantee you will walk away with at least one valuable tool. You will also have the chance to vote for new members of the Customer Connections Committee.

The committee has been creative over the past year, meeting mostly virtually to share ideas. Workforce continues to be a struggle for many Heartland customers and the committee is looking for creative ways to help recruit quality employees. It is important for your community to cast a vote to elect members.

You’ll also have plenty of time to visit with other customers and Heartland staff. It’s a great time to share ideas and ask questions.

Although our RSVP deadline has passed, you can still join us. Simply reach out to Danielle Kearin or Ann Hyland and let them know you want to attend. I guarantee you won’t regret it.

Addressing critical needs

Heartland offers a variety of programs for the benefit of customers. We pride ourselves on making these relevant to the communities we serve. However, needs are constantly changing, and we do our best to keep up.

With input from the Customer Connections Committee, we announced a new workforce development program at the end of 2020 to help customers tackle the hiring challenges many industries are facing.

Many in the public power sector are nearing retirement and replacements are needed. The areas of power line construction and maintenance seem to be the biggest concern, but customers are also seeing the retirement of finance officers and administrative staff.

Heartland developed a flexible program to aid customers in training and attracting new hires.

A few customers have already taken advantage of the program to offer hiring bonuses and assist with education costs. I encourage you to get in touch with Kelly Dybdahl if you foresee hiring new employees and would like more details.

Education is key

It is important for not just staff but mayors and city or utility commission personnel to understand our programs. We are happy to visit with anyone about the details to ensure communities can take full advantage.

Even if you have been given the rundown of the programs already, we’re happy to do it again. There is a lot of information to cover. Don’t ever hesitate to give us a call if you have questions.

One area I’d like to receive more focus is cybersecurity.

Public power utilities provide essential services. A few months ago, hackers broke into a city’s SCADA system in Florida to poison their water supply. They exploited the city’s outdated operating system and weak passwords to gain access.

Examples like this show hackers aren’t always looking for monetary gain. Significant damage can be inflicted without ever accessing account numbers. Utility and city personnel need to be on high alert and prepare for such instances.

Heartland works with industry partners to provide professional services to ensure your utility is secure. Utilizing these services now could prevent a devastating attack later, and the cost will be far less.

Contact Ann Hyland at Heartland for more information.

Suggestions welcome

We will continue offering programs and services that will make an impact on your community. However, if you would like to see a change to a program or have an idea for a new one, pleas let us know. No one knows better than you what would offer your community the most benefit.

In addition to our Annual Meeting, we are already gearing up for our Summer Conference, scheduled for July 27. We are excited to bring this event back to Madison, utilizing event space offered by the Best Western Plus. We are working on lining up some excellent speakers to help spark ideas for community growth and prosperity.

I look forward to seeing you at our Annual Meeting on the 12th and getting the chance to visit in person again.

CEO’s Report: Legislative Outlook

The American Public Power Association recently published an article, Making a difference: Advocating for public power. It provides a concise account of why building relationships with legislators is vital to the future of public power.

Heartland has long advocated for customers both on the state and federal levels. It is important to be involved in the legislature so decisions impacting our future aren’t made without our knowledge.

APPA CEO Joy Ditto also penned an editorial worth reading, Everyone is an advocate.

Having served in the South Dakota Legislature for many years, I have a natural passion for the legislative process. Now, we have another advocate in with boots on the ground in Pierre. Heartland Director of Economic Development Casey Crabtree serves in the Senate representing District 8.

Heartland also engages with lobbyists to keep an ear to the ground for bills that may impact any of our customers. We keep an eye on legislatures in each state we serve.

South Dakota

The last few years have been quite hectic during the legislative session. We saw bills aimed to restrict a municipality’s right to serve electric load in annexed areas. Heartland and our customers lobbied extensively against these proposals.

Fortunately, those bills never came to fruition as they would have been harmful to economic development in the state and hurt our customers.

This year, we aren’t seeing any bills of that extreme, but are still watching a few.

One bill the South Dakota Municipal League is keeping a close eye is HB 1050.

The bill would put in place an automatic increase for newspaper rates for publishing legal notices. It would also set up a statewide website through the South Dakota Newspaper Association.

The bill was put on hold after a fiscal note was requested on the House floor. Since the state also makes public notices, legislators would like to determine the cost to the state general fund before moving further.

An alternative bill, HB 1120, would have the state set up a website where meeting agendas, minutes and links to live meetings could be placed. SDML supports this bill.

A bill has also been introduced, HB 1117, to make permanent the ability for public meetings to take place virtually or via conference call if the entire governing body is meeting remotely. Notice provisions would apply as usual and information would be given to the public on how to participate.

Senate Bill 34 would appropriate $100 million to expand rural access to broadband services. It passed out of the Join Committee on Appropriations on a vote of 8 to 0.

If you don’t subscribe to SDML’s weekly legislative updates, I would encourage you to do so. Good information is provided, feedback is sought and concrete points give to communicate with your legislators.

Minnesota

In Minnesota, clean energy continues to be a hot button issue. Minnesota Municipal Utilities Association offers insight into the 2021 Legislative Session.

Clean Energy First (CEF) legislation seeks to increase non-carbon-emitting or “clean” energy in each utility’s resource mix through the Integrated Resource Planning (IRP) process.

MMUA believes a well-designed CEF approach will steer utilities towards the continued increase in the use of clean energy without artificial deadlines that fail to recognize technological limits and physical obstacles. Minnesota utilities have already made changes that have resulted in significant reductions in CO2 emissions below 2005 levels.

The Conservation Improvement Program (CIP) continues to require modernization to allow utilities flexibility at the local level. The current CIP has exhausted much of its benefit in many communities. MMUA believes it needs to be re-energized to enable utilities to achieve conservation goals, enhance low-income customers’ access to energy-saving resources, and foster the development of emerging and evolving technologies more effectively.

MMUA also opposes any effort to impose the mandated use of 100% renewable sources of energy, or any similar legislation that creates an artificial threshold without addressing the need to maintain local and system-wide reliability. Massive improvements to the transmission system, and substantial advances in storage technology will be necessary before Minnesota can approach a 100% renewable system.

More information about these and other issues important to Minnesota utilities can be found by visiting MMUA’s website.

Iowa

Legislative priorities for the Iowa Association of Municipal Utilities on the energy side include transmission cost control and a digital services sales tax exemption.

Most of Iowa’s municipal utilities are distribution only utilities and are dependent on transmission owned by much larger, interstate public utilities. Municipal utilities are sensitive to the need to provide the lowest possible rates. IAMU supports costs controls for transmission projects to insulate municipal utilities from increasing transmission costs.

IAMU also supports tax exemptions for municipally owned electric and natural gas utilities who obtain digital products and services for their own internal use. Iowa law gives for-profit investor-owned utilities and non-profit financial institutions an exemption from paying the 6% sales tax on various electronic services used for commercial purposes. IAMU supports efforts to grant municipal utilities the same exemptions.

IAMU issues emails a legislative update title Capitol Links. Contact IAMU to subscribe.

Nebraska

The League of Nebraska Municipalities has voted to support several bills so far during their state legislative session.

LB 178 would establish a turnback of state sales tax revenue to provide funds to municipalities to pay for infrastructure improvements. The state would pay back a portion of the state sales tax imposed on fees associated with infrastructure.

LB 83 is a top priority bill for the league. Like South Dakota’s bill, it would allow public bodies to meet by teleconference or virtual conference, subject to the Open Meetings Act.

As always, we encourage you to reach out to your legislators. It’s always important to maintain a good rapport with those representing you. Invite them to coffee, attend a cracker barrel or invite them to tour your community. The better relationship you have, the easier it is to talk to them when an important issue arises.

We will keep you apprised of any major developments we see out of state legislatures within our customer base.

We will also be watching federal policy and participating in the APPA virtual Legislative Rally next month. I would encourage you to sign up as it is free this year to all APPA members. A new administration will certainly bring new priorities and it is important to stay abreast of the issues.

I hope you all are staying healthy and look forward to seeing everyone at our Annual Meeting in May.

CEO’s Report: Ready to face the New Year

It’s no secret the year 2020 brought many challenges. But, public power employees persevered. They remained dedicated to providing reliable electricity and services essential to their communities.

Each of our customers faced unique challenges throughout the year. But they all provided top-notch service, and we are proud to partner with every one.

Heartland customers will see a bright spot heading into 2021. Wholesale customers will see steady rates for the fourth year in a row.

Heartland took several actions over the last few years to provide affordable power. Our goal was to provide stable rates to customers for the foreseeable future. Fortunately, we weathered the uncertainty of 2020. Prudent past decisions prepared us to handle the unexpected.

Heartland is always looking for new means to strengthen our position for the benefit of customers. We promised customers steady rates. Our staff worked throughout the year to ensure we kept that promise going into 2021.

The new year is sure to bring its own challenges. While we can’t predict the future, we can do our best to prepare to face those challenges head on.

It is our vision to be a partner of choice. We want to help each of our customers enter the new year with renewed strength. We look forward to working together to capitalize on opportunities to help customers thrive.

Workforce challenges

Many Heartland customers will be facing the same challenge in the coming years: workforce.

Many long-time municipal employees will be looking at retirement. So, customers will look to bring in new talent.

The areas of power line construction and maintenance appear to be of greatest concern.

We know this will be a big hurdle for customers and we want to help.

Heartland budgeted funds for 2021 to assist with workforce development in customer communities. Because every community is different, and challenges vary, the funding will be flexible.

We have outlined a few different options to put funds in place. But, we are open to discussing others based on your community’s unique needs.

We can provide signing bonuses or relocation allowances as lump sum payments.

We are also exploring a workforce recruitment program with scholarships and loans. Funding would be for those entering a Power Line Construction and Maintenance program. It would also require working at a customer municipal utility.

Stipulations would be set for each program to ensure program success.

Parameters have been set for the program, but above all, we want funding made available when needed. No red tape will exist, I assure you.

We also recently sent out a survey to assess customers’ needs for new employees in the coming years. The Customer Connections Committee will be meeting in January to assess the results. They will also brainstorm further ideas to assist where needed.

Opportunities in the new year

Heartland customers continued to thrive throughout 2020, despite challenges faced.

Heartland issued over $60,000 in growth incentives throughout the year. We also assisted with the purchase of two businesses by local entrepreneurs through our HELP Fund loan program.

Housing continued to boon in several communities. We saw new businesses pop up or begin construction.

Many also saw economic hardships throughout the year. COVID-19 varied from person to person, community to community and state to state. The same is true for it’s economic effect.

But, we saw our communities step up during 2020 to support their local businesses. Local support made a large impact. Heartland also offered a variety of marketing resources to help promote supporting local.

As we begin 2021, I have great optimism our customers will see more successes. The year is sure to bring its own challenges, but we are prepared to face them head on.

Heartland Customer Relations Manager Kelly Dybdahl has enjoyed getting back on the road to visit customers. He will continue making rounds as we kick off the new year.

However, if your utility has areas in need of help or you have ideas where Heartland can offer assistance, don’t wait for him to grace your doorstep. Give us a call so we can start working on solutions immediately. You know your communities best. Let us know how we can help.

Here is wishing you all good health and prosperity in the new year.

CEO’s Report: Preparing for growth of electric vehicles

Electric vehicles (EV) are quickly becoming a popular choice among drivers.

For many individuals, EVs are more cost effective than gas-powered vehicles. According to the Edison Electric Institute, EV drivers spend the equivalent of about $1.20 per gallon, based on average residential electric rates.

Electricity is less expensive than gasoline and EVs are more efficient. Maintenance costs are also typically lower on an EV compared to a gas-powered vehicle.

They also emit no tailpipe emissions and do not consume energy while at rest.

Edison predicts EV sales will surpass 3.5 million per year by 2030, with 18.7 million EVs on the road by that same year.

But EVs are not for everyone. The biggest challenge most EV owners face is finding a place to charge them, especially in the Midwest. Longer commute times in this part of the country also contribute to the slower rate of adoption.

Still, EVs will continue to grow in popularity, especially as charging stations become more widely available. Utilities will need to be prepared as more drivers use electricity to fuel their daily drive.

Different models for different drivers

Just like conventional vehicles, EVs come in different forms with varying technologies and features.

All have batteries that can be recharged by plugging into the gird. EVs are different than hybrid electric vehicles, which supplement an internal combustion engine (ICE) with battery power but cannot be plugged in.

Two basic types of EVs are on the road today: all-electric vehicles (AEV) and plug-in hybrid electric vehicles (PHEV).

A Battery Electric Vehicle (BEV) is an AEV that operates solely on an electric motor and the energy stored in its rechargeable battery pack. It is also charged partly by regenerative braking, which generates electricity from some of the energy normally lost when braking.

Most AEVs have ranges of 80 to 100 miles.

A plug-in electric vehicle runs on electricity for shorter ranges, anywhere from six to 40 miles, then switches over to an ICE, running on gas when the battery is depleted. These vehicles offer more flexibility to drivers, especially when travelling long distances.

Difference in Chargers

Charging an electric vehicle requires plugging into a charger connected to the electric grid. There are three major categories of chargers, each providing a different amount of power.

An AC Level 1 charger provides charging through a 120-volt AC plug and does not require installation of additional charging equipment. This charger provides a relatively slow charge, typically two to five miles of range per hour of charging. A full charge may take up to 24 hours.

Level 1 chargers are most often used at homes and sometimes at workplaces.

An AC Level 2 charger provides charging through a 240-volt plug and requires additional equipment to be installed. These chargers typically deliver 10 to 20 miles of range per hour of charging. They are typically found at homes and workplaces and sometimes public charging stations.

The DC Fast-Charge uses a 480-volt AC input and requires specialized, high-powered charging equipment. These chargers can deliver 60 to 100 miles of range in 20 to 30 minutes of charging.

Most modern EVs have a standard receptacle compatible with most Level 1 and Level 2 chargers. However, fast charging does not currently have a consistent standard connector. An increasing number of fast chargers have outlets for two different types of fast charging. But Tesla’s Supercharger system can only be used by Tesla vehicles or with a converter.

Fast chargers are common at public charging stations, especially along heavy traffic corridors.

Fast chargers are currently sparse in the Midwest with a few located along Interstate 90 in South Dakota. They are more common in Minnesota, located along major highways and interstates with a large cluster in the Minneapolis-St. Paul metropolitan area. Nebraska is home to a few fast chargers along Interstate 80 and they are spread pretty evenly around Iowa.

Assessing your readiness

As more EVs hit the road each year, it is important for utilities to be prepared.

The Department of Energy provides a variety of resources to help states and municipalities evaluate their readiness for EVs.

Tools include a plug-in electric vehicle readiness scorecard which allows communities to assess readiness, receive feedback about ways to improve, read about best practices and record progress.

There is also a handbook providing an overview for what cities hosting public charging stations need to know before installation and a link to relevant zoning codes and parking ordinances.

The DOE’s Alternative Fuels Data Center also includes a tool to locate current charging stations across the U.S. It also includes an instrument to measure driving distance between stations.

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You can also search for federal and state laws and incentives for installing EV charging stations.

Other Considerations

EV chargers come with operating costs including the cost of electricity to charge the vehicles. In addition, the charger may be subject to power demand charges. The use of Level 2 and fast charging stations may result in higher electricity costs by increasing peak electricity demand.

Fees may also be incurred if the charger is networked, covering the cost of network communications and back office support.

If your community is considering installing an EV charger, you’ll also have to consider how you’ll charge patrons for charging up. Credit card readers can cost as much as $1,000, but less expensive models are available.

When installing the charger, you’ll also want to consider ADA compliance to ensure the charger can be used by anyone.

EV charging stations can also serve as an economic development tool for communities with drivers seeking out stops on their routes where they can charge their vehicles. Because charging isn’t as fast as filling up with gas, drivers tend to patron local businesses while they wait.

EVs will only continue to increase in popularity as drivers seek not only reduced costs, but to do their part to help the environment. Heartland will continue researching best practices for customers in regard to installing chargers or even purchasing EVs for your city’s fleet.

Sources:

The Utility Guide to Plug-in Electric Vehicle Readiness (PDF), Edison Electric Institute, November 2011.

Chris Nelder and Emily Rogers, Reducing EV Charging Infrastructure Costs, Rocky Mountain Institute, 2019.

Electric Vehicle Basics, Office of Energy Efficiency and Renewable Energy, US Department of Energy.

CEO’s Report: Celebrate the public power advantage

Entering October means we’re on the downhill slide of 2020 and while I typically don’t like to see time fly, this year it may not be so bad.

But, with three months left in the year, we may as well take time to celebrate.

Public Power Week gives us the chance to not only share all the benefits public power offers, but also to educate people on what it is. 

Public power is still a term that doesn’t resonate with many people. We use municipal electric utility far more often. While it is an accurate term – municipal does imply that is a city owned entity – it doesn’t accurately reflect our purpose.

The term public power reminds us who we serve. We don’t answer to shareholders; we answer to the people of the community. The people we serve can make their voices heard at open meetings, where locally elected or appointed officials are making decisions with the best interest of the community in mind.

Why is this important?

Do your customers really know what it means to live in a public power community? Do they even know they live in a public power community?

Most people don’t give a lot of thought to where their electricity comes from. In fact, the average time a person spends thinking about their electric bill is about 6 to 8 minutes per year.

The other fact is most of us don’t choose our electric provider. We choose to live in a place and take the provider who serves that area.

But even if our customers don’t choose us, we still want them to appreciate the work we do and be glad they are served by us. We certainly don’t want them to distrust us or be unhappy with our service.

The public power advantage

So what are the greatest advantages public power offers?

Perhaps the greatest is being community-owned. When you live in a public power community, you are a citizen owner of the local municipal utility. Other providers can’t offer the same benefit.

Citizens can attend meetings, which are open to the public, be involved in the decision-making process and have their voices heard. Citizens also have a say in who is making decisions through local elections.

Public power utilities are not-for-profit, as all revenue is invested right back into the communities. So, when you pay your electric bill, not only are you paying to keep your lights on, you’re helping to ensure your community has quality roads, parks, water, and more.

Public power is also reliable. Nationally, public power customers are likely to be without power for just 59 minutes a year. They also divest in diverse resources to ensure environmental stewardship.

Protecting public power

Heartland customers are proactive when it comes to community growth and development. They are investing in the future of their towns through infrastructure improvements and helping local businesses thrive.

While as residents we may not choose who our electric provider is, businesses are often the opposite.

Many businesses choose to locate within a public power community so they can take advantage of all the city’s services including not only electricity, but water, wastewater, streets, garbage service and more.

It is important for us to protect the rights of cities to serve customers who want to be located within their boundaries and be served by them.

While public power utilities are often outnumbered by other types of providers, our voices can still be loud. It is important to continually visit with legislators about the impact your public power utility has on your community. Help them understand why businesses choose your community and the services you provide that other places can’t.

Celebrating Public Power Week

Public Power Week is a great time to celebrate the Public Power Advantage. During these uncertain times, it is not as easy to host a social gathering at your utility, but there are other ways to show your public power pride.

Heartland will be offering a variety of tools to help showcase the benefits your public power utility provides your community. I encourage you to use these resources to tell your story.

We sent you yard signs and posters to display. We are also conducting a social media contest and have social media posts and images you can use on your community pages.

There is no better time to get our message out and I encourage you to celebrate all the advantages your community offers.

Happy Public Power Week!

Poster describing the public power advantage.

CEO’s Report: Solar calculator simplified

Heartland reintroduces customer tool as a web-based application

School has started which means summer has come to an end. It also means our summer interns left us to get back to class.

But, they left behind great work, including a tool that will benefit our customers for years to come.

Heartland’s solar calculator was developed in 2019 to help end-use customers determine true cost savings of solar installations.

It was available for download from our website as an Excel worksheet. Though fully functional, it did have limitations.

Now the calculator is completely web-based, accessed through an online form. This modified process is much more user-friendly and resolves snags from the previous version.

Determines costs, savings

The calculator analyzes projects that fall in one of two categories: retail or utility.

The retail calculator is for customers who want to install solar panels on their property.

Users must provide some data, such as average monthly electric bill and project size or budget. The calculator determines the project’s generation output, savings and payback period.

It also indicates the likelihood of paying off the array, based on an average array lifespan of 20 years

The utility calculator helps determine the cost impact of a solar installation on a retail utility. Users provide the solar array size and the customer’s previous kWh usage.

Both make certain assumptions to determine true cost savings from installing a renewable system on a home or business.

Visitors to Heartland’s website must choose either the Utility or Retail solar calculator.

DEED helps fund internships

Interns developed both the Excel and web versions of the calculator. The internships were made possible in part by APPA’s Demonstration of Energy and Efficiency Development (DEED) program.

Peter Choudek

DEED funds research and innovation projects to improve operations and services of public power utilities. Scholarships are awarded for paid work experience at participating utilities.

Electrical engineering student Peter Choudek created the original version during his internship in 2019. This tool gained national recognition with an Energy Innovator Award from APPA.

John Kirkvold

In 2020, Heartland was again awarded a DEED scholarship to make the renewable calculator web ready. Computer science major John Kirkvold completed this work this past summer.

Links to the web calculators are available on Heartland’s website. Users will also find a step-by-step video tutorial, created by Kirkvold.

Tool helps make informed decision

A new report from research group BloombergNEF says solar power is the global leader in new power generation. In fact, at least 1MW of solar plants were installed in 81 different countries in 2019.

It’s true–solar technology is less expensive than before and widely available for homes, businesses and grids. What’s less clear is the value and suitability of small-scale installations.

Factors including roof space, location, state laws and more impact the payback period and savings that may be achieved.

With the ease of an online form, Heartland’s solar calculator can simplify this cost-benefit analysis and help residents–and the utilities that serve them–make informed decisions.

CEO’s Report: Analyzing the effects of COVID-19

Three months ago, states within Heartland’s customer footprint announced their first confirmed cases of COVID-19.

Since then, States of Emergency were declared, public schools were closed, and non-essential businesses were limited or closed. Social distancing recommendations led to many businesses shifting to work-from-home status and others were forced to lay off workers.

While all these measures were put in place for the safety and well-being of residents, as well as to ease the strain on hospitals, such measures are certain to have an impact on electric sales.

Heartland has been monitoring load data since COVID-19 started impacting the economy in the Midwest.  

Measuring the impact

The first cases of COVID-19 in the Midwest appeared in early March. However, stay-at-home orders and business closings didn’t start happening until a few weeks later in most cases.

However, Heartland’s total customer load in March was just over 8% below that of 2019 and less than 3% below the five-year average.

While those numbers may seem significant, when weather-normalizing the data, total customer load was 3.8% below 2019 and 1.72% below the five-year average.

Weather normalization involves measuring the impact of weather on energy consumption. Because weather patterns vary from year to year, weather normalization adjusts energy usage so it can be compared to energy usage in other years over a longer period.

Comparing energy consumption from one year to the next only provides the change between those years. Weather has a significant impact on energy consumption and when it is “weather normalized,” you are comparing energy consumption over a normal weather period.

When adjusted for normal weather, loads in March were much closer to expected levels. In fact, greater than 75% of the variance seen in March can be statistically attributed to weather variations. The weather in March of this year was significantly warmer than normal while in March of 2019, it was much cooler than normal.

Looking at April of this year, when we saw an entire month of closed or limited business, total customer load was 5% below that of April 2019 and 3.5% below the five-year average. When adjusted for normal weather, April load variance was similar to the actual data, given that weather in April of this year was near the five-year average.

Therefore, a significant portion of the load variance seen in April can be attributed to non-weather-related factors, including the effects of COVID-19.

Looking ahead

While we are still analyzing May loads, it is reasonable to expect the COVID-19 impacts to be larger due to continued business closings and decreased operations. While so far they have been reasonable, they seem to be increasing, evidenced by a 2% impact in March and 4 to 5% impact in April.

Even as businesses begin ramping back up, many will experience decreased product demand to the weakened economy. But, based on data we have seen thus far, we hope to see the effects start to decline as restrictions ease going into the summer months.

Despite these load fluctuations, prudent rate setting in the past has prepared Heartland for such a situation. We are not anticipating any rate impacts at this point due to the impacts of COVID-19.

Of course, we will continue monitoring the situation and rate stability will remain our priority.  

We understand that while we are all trying to find a sense of normalcy in this situation, we still have a long way to go before we can truly be “back to normal.” We will do whatever we can to help our customers and provide the best service possible, through this situation, and always.

As we attempt to “get back to normal,” our staff returned to the office June 1st. We still take COVID-19 very seriously, but feel we have the proper controls in place to protect our employees. Of course, we remain flexible should the situation change.

We look forward to being able to see you all in person.