2017 ANNUAL REPORT Roanoke-0818-AR.indd 1 7/9/18 12:51 PM

Transcription

1 2017 ANNUAL REPORT Roanoke-0818-AR.indd 1

2 S W T t s p f s M T r e d a t d V T p s c r Executive Summary è Roanoke Electric Cooperative is pleased to offer the 2017 annual report, highlighting your co-op s performance during this past year. W e enjoyed many successes in 2017, as we maintained our commitment to providing hallmark service and system reliability. Most notably, we laid the groundwork to extend the benefits of broadband technology to all our member-owners, while also offering innovative, energy-efficient products and services. We implemented process improvements and deployed progressive new and emerging technologies. With the overarching goal of improving the quality of life of those we serve, we continued to demonstrate our strong commitment to community empowerment and economic development through various programs and outreach efforts. Our forefathers likely never envisioned the impact technological advancements would have on our co-op today now eight decades since they led the charge to bring electricity to this region. But that innovative spirit still lives on in us, as we rise to the challenge of meeting your needs in an evolving energy landscape. On this 80th anniversary of Roanoke Electric Co-op, we look back with pride on our humble beginnings. As we enter a new era, we also are looking forward willing and eager to explore opportunities for continued success. We invite you to scan through this report detailing our strong business and financial outlook. Roanoke Electric Co-op would like to thank you, our member-owners, for your support over the past year. We are proud to serve as your electric cooperative. Respectfully, Curtis Wynn, President & CEO Allen Speller, Chairman 2017 Annual Report 2 Roanoke-0818-AR.indd 2 è

3 Strategic Plan Where we are going The purpose of the co-op s strategic plan is to establish the direction of the organization and create a foundational strategy that balances long-term objectives, operational priorities and financial discipline. Refined in 2017, this four-year plan outlines the co-op s mission, vision, values, strategic destination and initiatives through Mission Statement To provide member-owners with safe, reliable and affordable electricity, while enhancing the quality of life in the diverse communities in which they live and work. This mission is fundamental to who and what the co-op is, what it does and for whom. Vision Statement To be recognized as a leading co-op providing top-tier performance in safety, service and reliability. The co-op s four priority objectives for realizing its vision are: èèto be recognized as a highly efficient co-op applying superior customer service, best work practices and effective technologies that result in high value for member-owners; èèto emphasize the development of employees as leaders, ensuring a highly-trained and qualified workforce that is well-equipped to meet the many challenges and opportunities of an evolving industry; èèto be recognized as a leader by the co-op industry, stakeholders and communities for delivering effective and high-impact diversified services to the co-op s member-owners while further benefiting the welfare of the communities in which they live and work; and èèto be known for its compassion, care and commitment to the diverse communities that the co-op serves. Values Statement The co-op s core values serve as the foundation and starting point in the organization s strategy map. These values engage the co-op s workforce to successfully execute organizational strategic initiatives serving the member-owners. Roanoke Electric Co-op core values are: èèa member-owners first mindset; èèsafety & wellness; èècutting-edge innovation; èèteamwork approach; èècompetency; èètrustworthiness; èèadaptability; and èèfriendliness. Strategic Destination Roanoke Electric Co-op seeks to be recognized as a top-tier performer by bringing its member-owners best-in-class service they want and deserve as reflected in high engagement and satisfaction scores and by enhancing quality of life in the communities it serves. Strategic Initiatives Roanoke Electric Co-op s core business, providing safe, reliable and affordable electricity, will always be its priority. We will strive to continue offering high-impact, high-value services that serve in the best interest of our membership. Roanoke Electric Cooperative 3 Roanoke-0818-AR.indd 3

4 Strategy Map Mapping our strategy How we are getting there The co-op maps its methodology for reaching its key business objectives, using a framework of strategic perspectives as guideposts. This is presented in detail in the strategy map. Cooperative Difference improve our members quality of life Member-Owner Satisfaction High Reliability Member-Owner Value Engaged and Active Goal of Low Cost that enhance value and... Grid Optimization Reduce Controllable Costs Subsidaries Self-Sustained Improve Reliability Leverage Technology Build Member Value so they can execute strategies Improved Outage Reduction System Improvements Cross Functional Competency Call Center Availability Deliver High Impact Services Effectively Communicate Engaged Workforce to engage our team Top Tier Safety Performance Empowered and On-Track Healthy Lifestyles Political Engagement Core Values Building on our core values Memberowners First Safety & Wellness Cutting Edge Competent Trustworthy Adaptable Friendly 2017 Annual Report 4 Roanoke-0818-AR.indd 4

5 Reaching the destination Service through innovative energy solutions The Roanoke Electric Co-op strategy agenda transforms traditional planning into an active, actionable and nimble process that maps a customized path for positive change. Using the strategy map as a compass, the co-op put programs in place to help the co-op team and member-owners work together to achieve cost-saving efficiencies. Highlights of high-impact initiatives success in 2017 include the following: Roanoke Connect In 2017, the co-op successfully completed build-out of its fiber-optic network. This network serves as the backbone to connect the co-op s 12 substations, enabling the co-op to increase communication speed, capacity and bandwidth capabilities for collecting and sharing power system information and data. These energy grid system improvements benefit member-owners by enhancing communications between co-op and substations, meters, and down-line devices throughout the co-op s system. By taking advantage of this leading-edge technology, the co-op can now monitor substations and evaluate energy use, improve overall reliability and increase security of its power grid. In meeting its own requirements for broadband communications and reliability, the co-op recognized the need of member-owners to have access to broadband internet service. Over the next two years, the co-op will extend the availability of this service throughout its sevencounty territory to make it available to all member-owners. Upgrade to $ave Understanding that serving its membership means more than just providing electricity, and knowing the challenging economic conditions in the region, the co-op created its Upgrade to $ave initiative to help alleviate financial challenges that member-owners face. At the end of 2017, the Upgrade to $ave program had retrofitted more than 280 memberowner homes with energy efficiency improvements. The co-op estimates these energy-efficiency improvements will end up having saved member-owners over fifty thousand dollars since the program began in 2015 and for the lifespan of the upgrades. During Upgrade to $ave s initial five-year period, the co-op expects to complete between 800 1,000 homes. Smart Energy Devices Smart energy devices, such as Wi-Fi enabled thermostats and water heater control devices, help member-owners better manage energy use for cost savings on their power bills. Deploying these devices helps to lower the costs the co-op must pay for electricity, thereby lowering the costs it must then pass on to member-owners. More than 100 households signed up to participate in the Wi-Fi thermostat program since the program launched early last year. In 2018, the goals for this program are even higher, as member-owners subscribing to Roanoke Connect broadband internet service will be able to take advantage of these devices and other Wi-Fi-enabled technologies. Roanoke Electric Cooperative 5 Roanoke-0818-AR.indd 5

6 Member-Owner Engagement and Satisfaction Member-owner feedback is the co-op s most crucial measure by which to gauge how well it is serving its membership and communities. Striving to be a leading co-op in providing toptier performance means the co-op takes to heart the trust and confidence you place in your directors and staff. It is grateful for your positive feedback on efforts of last year. At the end of 2017, the co-op conducted the annual survey of its member-owners and is proud to report that satisfaction scores continue to rise. Your survey responses and other performance measures show that more member-owners are downloading the co-op s mobile app and signing up for high-use alerts. Survey responses also show The co-op s overall increased engagement with member-owner your co-op on its website and satisfaction score social media channels. By the remains higher than close of 2017, 10 percent of you the average co-op and joined ACRE, demonstrating investor-owned utility. your commitment to grassroots advocacy on issues important to electric co-ops. The co-op was distinguished by the North Carolina Electric Cooperatives statewide organization for having the highest number of member owners join ACRE and for raising the second highest dollars per capita in ACRE dollars in Your input and feedback help the co-op to chart progress and determine how best to serve you and offer even greater value in the future. The Road Ahead As we reflect on last year s accomplishments, the co-op now looks forward to a future of innovation. One of the co-op s newest programs, Roanoke SolarShare, aims to make the benefits of solar energy more accessible to all member-owners. Through the initiative, the co-op is responding to the call to serve by removing the financial barriers to this renewable energy resource. The effort will center on the co-op s plans to fill the remaining subscriptions to its community solar garden, built adjacent to the co-op s main office in Aulander. With these subscriptions, covered by philanthropic donations, deserving families will incur no costs for solar energy credits Battery-stored electricity may offer member-owners further cost savings. on their utility bills through the end of The co-op will continue to explore innovations across the dynamic solar energy landscape, such as battery storage of solarpowered electricity, which may offer member-owners further cost savings. The co-op is also investigating opportunities within the rapidly evolving electric vehicle industry. With more affordable electric vehicle options available each day, member-owners may soon find they can eliminate or reduce the costs of gasoline to fuel their vehicles. The associated increase in electric load growth could also offer the co-op a way to provide more affordable electricity by helping it to stabilize rates Annual Report 6 Roanoke-0818-AR.indd 6

7 2017 Financial Reporting Financial Report How your dollar is spent r. Total Electric Revenue 34,662,446 Non-Operating Interest 1,092,157 Total 35,754,603 Cost of Power 18,659,840 Transmission Expense - Dist/Operating Expense 1,909,081 Maintenance Expense 2,977,897 Member-Owner Accounts 1,318,272 Member-Owner Customer Service 954,778 Adminstrative and General Expense 3,570,757 Depreciation 2,914,459 Taxes - Interest 2,057,769 Other 18,819 Total 34,381,672 Income (Loss) from Equity Investments (26,765) Total Margins 1,399,696 Cost To Borrow Money 0.06 Plant Cost 0.08 Net Margins 0.04 Cost To Operate 0.30 Assets Net Plant 72,951,062 Other Property 11,917,113 Cash 3,288,900 Accounts Receivable 5,701,199 Materials 1,076,710 Other Assets 1,484,291 Deferred Debits 1,048,802 Total 97,468,077 Cost Of Power 0.52 Liabilities Capital Credits 40,742,723 Long Term Debt 46,406,203 Accounts Payable 2,835,469 Deposits 828,397 Deferred Credits 1,265,530 Other Liabilities 4,424,931 Other Current & Accrued Liabilities 964,824 Total 97,468,077 McNair, McLemore, Middlebrooks & Co., LLP completed Roanoke Electric Cooperative s 2017 Combined Financial Audit in accordance with Government Auditing Standards issued by the Comptroller General of the United States. Roanoke Electric Cooperative 7 Roanoke-0818-AR.indd 7

8 Board of Directors District 1 Columbus Jeffers District 2 Delores Amason (secretary-treasurer) District 3 Carolyn Bradley District 4 Robert Nat Riddick (vice chairman) District 5 Ken Jernigan District 6 Millard Lee (asst. secretary-treasurer) District 7 Darnell Lee District 8 Allen Speller (chairman) District 9 Chester Deloatch 1 Halifax Northampton 3 Jackson Halifax 2 Conway 9 Winton Hertford Rich Square Ahoskie Aulander 8 4 Bertie 7 5 Gates 6 Merry Hill Windsor Gatesville Chowan Roanoke-0818-AR.indd 8 7/9/18 12:52 PM