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ANNUAL 2018 REPORT Value you can count on Letter to the Membership From the Board Chair and President & CEO Value you can count on Most of us consider ourselves to be “value the lights on! In 2017, WH: buyers” when it comes to products and • Achieved a perfect safety record services. That is, we carefully weigh what with no incidents and no-lost time we get for what we pay whether it's cars by our employees. As important, our or groceries or entertainment. membership was 100 percent free of So it’s worth asking: What is the value of electrical contacts. a hot shower? What’s the value of staying • Delivered reliable power in the top cool in air-conditioned comfort on a hot, 10 percent of cooperatives Erick Heinz Tim Sullivan sticky July day? Or what’s the value of nationwide. In fact, we’ve cut our Board Chair President & CEO safely drying already low outage rate by almost your favorite half over the past decade. sweater, or • Expanded the deployment of recharging Value Means Service: At WH, we know next-generation your mobile delivering value means providing prompt Automatic Meter phone, or quickly heating up dinner in answers, good advice and helpful Infrastructure (AMI) the microwave? solutions for your needs. In 2017, WH: meters, which can read and report • Pulled in almost $13 million in Most of us haven’t thought about it, in your usage hourly revenue through its WH Holding part because the electricity that makes to WH and to businesses, including WH Security, these services possible isn’t priced that MyMeter, our free HeatMyFloors.com, WH Services way. In fact, at an electric cooperative on-line energy (WH Appliance Repair and WH Tree like Wright-Hennepin (WH), electricity is portal. priced not by the value it provides but to Services) and WH International recapture the costs of generation, Response Center. Collectively, these • Took the next step toward transmission and distribution. businesses absorbed almost developing a fully-functioning $2 million in costs which otherwise microgrid at Millennium Park in But asking the question “what would you would have been borne by WH Rockford which combines a diesel pay?” does highlight just how valuable – electric members. generator, solar arrays, demand and inseparable – electricity is from our management receivers and AMI to • Earned an American Customer daily lives. And as a member-owner of serve area members. WH, it’s reasonable and helpful to ask: Satisfaction Index (ACSI) score of 85, what value does WH uniquely provide which is seven points higher than Value Means Support for Local beyond basic electric service? electric cooperatives nationally (78) Communities: Value is also created when and 12 points higher than we give back to the communities we Well, we’re glad you asked! At WH, we Xcel Energy (73). serve. In 2017, WH: provided value to you in 2017 in six important ways: Value Means Choices and Options: You • Delivered almost $200,000 want flexible offerings tailored to your to charitable and non-profit Value Means Competitive Pricing: pocketbook, needs and values. organizations in our area through WH again delivered competitively-priced In 2017, WH: Operation Round-Up, a trust that electricity to our membership. dispenses the money raised when WH • Delivered more rate options, rebates In 2017, WH: members generously round up their and special programs than bill each month. • Provided lower cost electricity ever before. compared to Xcel Energy. On an • Supported local schools by providing • Provided significant new energy average residential monthly bill WH scholarships for deserving high savings opportunities for members was 1.79 percent lower, 9 percent school seniors, night lights and with rebates for air source heat lower when you consider energy tree seedlings to elementary pumps, electric water heaters, air savings rates and 13 percent lower school students in kindergarten conditioning, dual fuel and more. when you count Capital Credits. and third grade and electric safety • Returned $3.6 million in Capital • Developed new Solar Choice and demonstrations to kids of all ages. Renewable Choice options (details to Credit refunds, touching 90 percent We hope you agree this is clear, concrete be unveiled at the Annual Meeting) of the membership. and compelling value for you, your family, which allow consumers to purchase your friends and your neighbors served • Saved more than $3.7 million in energy supported either by WH’s by WH. After all, it’s your co-op and we wholesale power purchases (which portfolio of solar assets or by appreciate your business! make up almost 70 percent of your renewable energy from the grid. bill) by buying directly out of the Cooperatively, regional electricity market. Value Means State-of-the-Art Technology: Part of being a 21st Century Value Means Safety and Reliability: utility means making investments into At WH, we know delivering value means cutting-edge technologies which deliver keeping you, your loved ones and value through faster, cheaper and better Erick Heinz, Tim Sullivan, 2 our employees safe while keeping service. In 2017, WH: Board Chair President & CEO Competitive Performance Reliability Performance 2017 residential rates were very competitive WH proved reliable again in 2017 One of the core tenants of Wright-Hennepin’s (WH) mission WH is proud to inform you that members again averaged less is to keep rates competitive. WH stacks up well against other than one outage per year (see graph below). But when the electric utilities and cooperatives as the graph below shows. lights do go out, members can rest assured that their Moreover, members enrolled in a WH Energy-Saving Program cooperative will keep them informed through multiple (ESP) experienced an even lower price of power. WH’s rates are channels including mobile outage notifications, WH’s outage below state and national averages. map and social media updates. All of these include an In 2017, WH returned $3.6 million in Capital Credits – the estimated time of restoration and cause for the outage. To sign largest refund in the history of the cooperative – to 90 percent up for email or text alerts, visit http://goo.gl/AN4Bxf, and follow of members. We also gave you the flexibility to spend that us on Facebook and Twitter. money where you see fit by distributing a check instead of a bill credit. These refunds are possible when revenues exceed expenses. Our goal is to provide power to you Reliability at the lowest possible cost consistent with good service, and we hope this provides tangible evidence of your stake in WH Members averaged less than one outage and the cooperative difference. per year Competitive 0Rate competitiveness5 10 for 2017 15 20 0.9 WH With ESP and Capital Credits 0.87 ® 0.8 WH With ESP 0.7 ® 0.64 WH With Capital Credits 0.6 ® 0.60 0.5 WH General Service Only 0.45 0.45 0.44 0.45 ® 0.52 0.51 0.43 Xcel Energy 0.4 Local Municipal 1 0.3 Local Municipal 2 0.2 Average outages per year Average 0.1 Metro Electric Cooperative 1 0.0 Metro Electric Cooperative 2 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Metro Electric Cooperative 3 Years Minnesota Electric Utility Average* National Electric Utility Average* California Electric Utility Average* 0 5 10 15 20 Cents per kWh *Source: Energy Information Administration WH’s Board of Directors From left to right: Board Chair Erick Heinz, District 9, Corcoran; Chris Lantto, District 5, Annandale; Mike Tieva, District 6, Maple Grove; Kenneth Hiebel, District 7, Plymouth; Casey Whelan, District 8, Maple Grove; Secretary-Treasurer Dale Jans, District 4, Buffalo; Vice Chair and WH Holding Chair Timothy Young, District 1, Annandale; Burton Horsch, District 3, Howard Lake; and Duane “Butch” Lindenfelser, District 2, Monticello. Operation Round Up Since 1994, Wright-Hennepin (WH) members have made • Second Chance generous donations to local organizations through Operation for Life Foundation Round Up (ORU). Two of these organizations include Pay It is another Forward Fund and Second Chance for Life Foundation. organization to • Pay It Forward Fund is an organization which WH has to which WH has donated $15,000 since donated for several 2015 through ORU. Another $5,000 is years. Since 2004, scheduled to be donated in 2018. Pay It WH ORU has Second Chance for Forward Fund is a non-profit donated $20,000 to Life Foundation organization that dedicates itself to the organization. helping breast cancer patients. The Second Chance for Life Foundation is a support group for funds they receive are directed towards heart transplant recipients, candidates, their families and supporting the basic living expenses of donor families. The funds they receive are directed towards utilities, housing, medical care and patients in need of heart transplants. transportation while the patients Mimi Huber These organizations are appreciative of the generosity undergo treatment. shown by WH members throughout the years. 3 Services Operating Performance Service PerformanceACSI Compared to other utilities Keeping costs low Meeting and exceeding your needs Wright-Hennepin (WH) has consistently kept costs below 2017 American Customer Satisfaction Index state and national levels despite the ever-increasing cost of Scores, compared to other industries wholesale power. This is accomplished by implementing the most cost-efficient technology on the grid and in our 85 85 84 78 82 77 79 79 offices, ensuring members receive energy at a fair and 77 71 competitive rate. WH wholesale power costs and local operating costs ® 80 Nike Target Netix Google Amazon WalMart Mercedes Starbucks Wholesale power costs 60 Cooperative Utilities Cooperative 40 At Wright-Hennepin (WH), we take member satisfaction seriously. We measure it twice a year through the American Customer Satisfaction Index (ACSI).