At the November 2025 Board meeting, the Dakota Energy Directors approved a rate adjustment. This adjustment will take effect with the January 2026 billing cycle. We know any rate increase affects our members, as this decision was not made lightly. That is why we focus on transparency, accountability, and service. It reflects the rising costs of providing safe, reliable electric service in today’s economic environment.
This rate adjustment is based on a comprehensive cost-of-service study conducted in October 2025 by an independent consulting firm. The study shows updated rates are necessary for financial stability and to meet our lenders’ requirements. The primary driver is the significant increase in the cost of purchased power from East River Electric, Basin Electric, and Western Area Power Administration in 2026. Delaying action would risk financial instability and non-compliance with lender covenants.
Despite these challenges, Dakota Energy manages controllable costs through careful planning and operational efficiency. Our employees remain dedicated to delivering high-quality service while serving as responsible stewards of your cooperative’s resources.
We are committed to maintaining a reliable electricity supply and providing excellent value for your money.
Beginning January 1, 2026, rates will increase with specific impacts varying by rate class and usage. For a typical residential household using 1,500 kilowatt-hours (kWh), this means an estimated increase of about $70 per month. This adjustment includes a demand charge (kW) and an increase in the service charge.
The new rate structure has three main parts: a Service Charge, an Energy Charge, and a Demand Charge.
- Service Charge: Pays for the fixed costs that keep our system safe and reliable, like maintaining poles and transformers, responding to outages, clearing right of ways, and covering essential services such as billing, insurance, and building upkeep. These costs have always been part of your rate structure.
- Energy Charge: This charge is based on the total electricity consumed over a given period and is measured
in kWh. - Demand Charge: This is based on the rate at which energy is used and is measured in kW. It is the amount of power required in an instant to satisfy the needs of all your connected appliances, lighting, heating, and anything else that requires electricity at the exact same time. It has been displayed on your monthly bill since January 2025 at no charge for single-phase services. For metered electric heat, the electric heat demand will be subtracted from the main meter demand at the time of peak.
On January 1, 2026, the following rate changes will also be impacted:
- Rental Security and Yard Lights: The cost for rental security and yard lights will increase by $3.00 per light each month based on the cost of service study.
- Controlled Air Conditioning Rate: We want to let you know about an upcoming change to our Load Management (LM) program under the air conditioning rate. Today, 193 members are on this rate, and the LM devices we’ve used to control air conditioners are nearing the end of their life cycle and have become costly to maintain. At the same time, modern cooling equipment is far more energy efficient, reducing the need for cooperative control.
Beginning in 2026, we will no longer control air conditioning at your location during the months of May through September. Instead, you will have full control over your own usage and can decide how best to manage your demand. Members will continue to be eligible for cooperative rebates with qualifying installations of energy‑efficient equipment. We appreciate your participation in past programs and your ongoing commitment to energy efficiency, and we believe these changes will help us focus resources where they provide the greatest benefit to all members.
Dakota Energy is aware the demand charge is a new rate component. If you would like to learn more about demand and how you can lower your monthly demand, visit Understanding Demand Billing. As always, feel free to contact our office at 605-352-8591. We are here to help. Thank you for your continued trust and support.