In an effort to engage the manager and trustees of Socorro Electric Cooperative in a dialogue, Mayor Ravi Bhasker at last week’s SEC board meeting proposed three potential solutions to continuing the franchise agreement — which is currently on a month-to-month basis — between the Co-op and the City of Socorro. One of options, Bhasker said, would be for the city to acquire the cooperative in its entirety, in effect shutting down the 72 year old institution.
With all seven trustees and General Manager Joseph Herrera in attendance, as well as two representatives from Tri-State Generation and Transmission, the mayor read from a prepared statement.
He said one solution would be for SEC to sell off its assets for the grid within the Socorro city limits. “We will assume all debts,” he said. “We then would proceed to do a mutual agreement with a company to do (operations and maintenance).”
A second solution, Bhasker said, would be for Socorro Electric to sell the entire co-op to the City of Socorro.
Bhasker’s third option would be the City’s proposition “to continue serving a small industrial section of the community and provide them with electricity at a lower rate.”
In defense of the City’s proposed separation, in part or entirely, from the cooperative, Bhasker said the City Council, residents and businesses alike “have expressed some concerns...” He said these included, “consumer complaints about customer relations and the quality of electrical service, and the lack of participation of the Socorro Electric Co-op in renewable energy generation as allowed under its agreement with its wholesale provider, Tri-State Generation and Transmission.”
He also mentioned “an unwillingness to participate in initiatives to foster economic development and a resistance to proposals by outside companies to improve and benefit the well-being of our community.”
One concern Bhasker has been particularly vocal about over the past couple of years was the above average rate for “industrial users, which is hindering the City’s ability to attract businesses to spur economic growth in the City of Socorro.”
Bhasker maintained that the City of Gallup was able to secure lower electric rates by negotiating with its power provider, Continental Divide Electric Cooperative.
“How can Continental Divide sell Gallup electricity cheaper than SEC can sell it to SEC customers, when both entities purchase electricity from Tri-State?” Bhasker said.
He pointed out that Gallup’s rates are approximately two-thirds of Socorro Electric’s.
“There has to be some way,” he said. “SEC with City support – can renegotiate the Tri-State agreement that is beneficial for all parties involved.”
Socorro Electric’s contract with Tri-State runs out in 2063.
In summing up, Bhasker said he would encourage the board to consider “all options for provision of electric service at a lower cost and at our proposal to sit down for substantive dialog exploring all the potential options.”
He said a study on the feasibility of a municipally-run electric utility concluded that its rates could be lower than current SEC rates.
“As a franchisor, we ask for a meeting of the owners/members to present to options up to and including the dissolution of the Socorro Electric Cooperative” Bhasker said. “We respectfully request that meetings intended to make this happen occur within six months.”
He said the franchise agreement would be terminated if the process did not begin immediately.
Board President and District V Trustee Anne Dorough told Bhasker the board would take his comments under consideration, and “will be reviewing on behalf of our members.”
“We have to take into consideration (a decision) that would affect all the members of our cooperative,” Dorough said. “And we also have to consider whether you are able to provide the options which you say you can.”
Bhasker agreed, and said, “I would hope you would allow us the same privilege of also explaining our role as to how we could do that.”
“I do understand that in your bylaws you have a certain clause that states that the board can overrule what the members say, and can negate their vote,” he said. “That’s one of the clauses in your bylaws, and I would hope that you would, at this point, try not to exercise that rule and listen to the voice of the members.”
Dorough said the coop would “certainly contact our members for input on this and will take it under consideration.”