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1976-1984
Peak power usage
Basin Electric’s member systems’ demand for electricity in the 1970s was increasing at an alarming rate. It became evident that Basin Electric's existing generation would not be enough to meet its all-requirements contractual obligations to its members in the near future. Since power plants take eight to 10 years to construct, planning for new power projects began during the early 1970s.
Spirit Mound Station (SMS)
In 1978, the Spirit Mound peaking station came on-line in Vermillion, SD. The purpose of this fuel oil-fired plant was to generate electricity when demand in the Basin Electric system was maxed out. Spirit Mound burns 100 gallons of fuel oil per minute when operational. No additional transmission construction was required, and an oil pipeline for delivering fuel was nearby.
The 1970s
In the late 1970s Basin Electric was in the throes of a massive construction phase – a new power plant was being constructed in Wyoming and another one in North Dakota to provide power to Basin Electric member cooperatives. Predicting (or projecting) power needs 10–12 years in advance for a large region of the United States is not an exact science. Compared to the 1976–'78 anticipated load growth of 20 percent, the Basin Electric 1979 Power Requirements Study showed a 6 percent load growth. This meant that the power plants that were currently under construction would have capacity to create more power and expenses than consumer demand would require.
At the same time, interest rates were skyrocketing. During the late 1970-'80s, rates went up 146 percent. Interest expense on the money borrowed to finance construction of the new plants, was costly and had to be paid through rate increases to Basin Electric's membership.
Laramie River Station (LRS)
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LRS groundbreaking ceremony near Wheatland, WY, 1977. |
Antelope Valley Station (AVS)
Originally scheduled to be on-line in 1981, the Antelope Valley Station project near Beulah, ND, was delayed until 1984 due to slower than projected load growth in the Basin Electric system. The first unit was declared operational in 1984.
Basin Electric average member rates
The average mill rate for Basin Electric consumers during the early to mid- 1980s increased significantly. This was a very challenging period for Basin Electric and its members.
Managing the surplus
In an era of surplus power and increasing costs, it was essential for Basin Electric to increase efficiencies and electricity sales while reducing costs. This was done in several ways: promoting special electric rates, appliances – like water heaters, and deferring expenses.
Spirit Mound Station
The Dakota Sioux, Omaha and Oto tribes named this area “Spirit Mound” because they believed it was occupied by spirits that killed any human who came near. Lewis & Clark visited the mound on Aug. 25, 1804 – making a special trip: nine miles away from the Missouri River. They climbed to the summit (70 feet above the surrounding plain) and noted the abundance of insects that attracted great flocks of swallows. Lewis & Clark speculated it was the birds that gave the mound its air of mystery.
Interest rates skyrocket
In 1977, actual interest rates were as low as 6.7 percent. Basin Electric was only $18 million in debt from Federal Finance Bank – RUS' lender, and Basin Electric's largest lender). By 1981, interest rates were as high as 16.4 percent and our debt to FFB was $1 billion due to construction of both AVS and LRS. In 1980 power costs increased 29.4 percent - from 18.44 mills to 23.93 mills.
Headquarters
1717 East Interstate Avenue
Bismarck, ND 58503-0564 USA
Phone: 701.223.0441
