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A Message from the Chief Financial Officer

Michael W. Henderson
Executive Vice President and Chief Financial Officer

Arkansas Electric Cooperative Corporation (AECC) was created to ensure rural Arkansans have a reliable and affordable electric power source. AECC owns and has an ownership interest in 14 power plants capable of generating 3,514 megawatts of electricity. In addition AECC has contracted for an additional 596 megawatts of generating capacity from hydroelectric, wind, solar, natural gas and coal facilities to ensure its members are served with diverse and responsible resources. AECC does this because reliable, responsible service matters to its members.

This past year AECC participated in the Southwest Power Pool (SPP) and Midcontinent Independent System Operator (MISO) power markets. Prior to entering the power markets, AECC relied on bi-lateral contracts and its own generation fleet to deliver reasonably priced energy to members. Participation in the power markets positions AECC to access the lowest cost energy for members. This strategy is important because low electricity cost matters to AECC's members.

Strategic decisions were made in 2015 to ensure AECC remains strong financially. Members elected to proceed with rate adjustments that will result in AECC remaining among the strongest credit worthy companies in the United States. This financial strength will ensure AECC has access to low-cost capital, such as its commercial paper program. Low cost capital results in low-cost electricity which matters to AECC’s 17 distribution cooperatives, and ultimately retail members.

Fortification of the nation’s transmission grid to improve reliability has come at additional costs. To ensure AECC and its members can manage the growing transmission costs, AECC’s board of directors and the Arkansas Public Service Commission approved the implementation of a regional transmission organization rider. Removing regulatory lag associated with changing costs will reduce costs associated with multiple rate filings and thus benefit members.

By focusing on strategies to ensure AECC members receive reliable, affordable electric service in a responsible manner proves one thing…Members Matter!