At their December meetings, the boards of directors approved the 2024 operating and capital budgets for Basin Electric and subsidiaries.
Darla Jensen, Basin Electric manager of Financial Reporting and Planning, said the budgets were developed with some key assumptions in mind: new market pass-through rates effective June 1, 2024; forward pricing as of September 2023 utilized; total capital expenditure cash flows of $587.7 million; two major outages at generation facilities; increased financing costs due to capital expenditures; and deferred revenue will need to be amortized into net margin to achieve a consolidated margin of $150 million therefore supporting the cooperative’s “A” credit rating.
Basin Electric’s 2024 operating budget includes total cost of electric service of $2.2 billion. Of that, approximately 37% represents purchase power and wheeling, 18% is the cost of fuel, and 18% can be attributed to fixed expenses such as depreciation and interest. Basin Electric's average member rate for the 2024 budget is 59.10 mills, and the estimated 2024 margin after tax is $87.2 million (including consolidated eliminations related to gain/loss on investment in Dakota Gas) prior to amortization of deferred revenue out of the Rate Stability Fund.
“The cash flow for capital projects in 2024 amounts to $587.8 million. About $321 million of that can be attributed to new generation, specifically natural gas generation, and new transmission, about $126.5 million” Jensen said. “We are also looking to invest more in our existing generation facilities in 2024.”
The consolidated net income after-tax, after amortization out of deferred revenue from the Rate Stability Fund, for Basin Electric and its subsidiaries is estimated at $151.9 million.
Dakota Gasification Company
Becky Haider, Basin Electric supervisor of Financial Planning, said the 2024 operating budget for Dakota Gas includes operating revenue of $559 million. “A little less than half of that comes from the fertilizer products: urea, anhydrous ammonia, ammonium sulfate (Dak Sul 45), and diesel exhaust fluid. Natural gas sales makes up 25% of the total revenues budgeted in 2024,” Haider said.
The budget also includes operating expenses of $481 million, with 60% of those expenses going to coal, labor, electricity, and natural gas purchases. “Dakota Gas’ capital budget includes expenditures of $27.5 million,” Haider said.
Dakota Gas’ budgeted net income after tax is $15.5 million.
