Basin Electric defers revenue to 2021

In 2018, Basin Electric’s membership voted to build the cooperative’s deferred revenue balance, which acts like a reserve, to $300 million. This pool of deferred revenue helps strengthen the financial and rate stability of Basin Electric.

Deferred revenue can be used when a “rainy day” strikes, such as the energy emergency event in February 2021, when natural gas prices spiked because a lot of natural gas production was shut in due to freezing temperatures and natural gas was in high demand due to electricity generation.

At the March meeting, Basin Electric directors authorized deferring $33.7 million of surplus sales revenue from 2020 to 2021. “Basin Electric earned higher revenue and margins than forecasted during 2020, and we will likely see a need for additional revenue in 2021 due to the uncertain impact of energy market volatility so far this year,” said Shawn Deisz, Basin Electric vice president and controller. “The additional $33.7 million will help keep rates stable in 2021, which helps show the value of the cooperative members’ decision in 2018 to maintain deferred revenue.”

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