OPALCO Board Passes 2026 Budget and Rates
The 2026 OPALCO annual budget was approved at the November 20th board meeting including changes to the rate structure and a ~6% rate increase for residential members. This works out to an increase of approximately $12/month for the average San Juan County residence. The budget forecasts 5% rate increases for each of the next five years to keep up with inflation, the rising costs of power and labor, and to manage the Co-op’s equity position. The Co-op uses equity to borrow federal funds to build essential capital projects, like the multiple submarine cable replacements that are scheduled over the next 10-20 years.
The OPALCO team did an extensive analysis of the OPALCO rate structure during 2025. Members will see some changes in the way their bills are allocated in 2026 due to findings of the rate study. Here is a summary of the rate changes:
- Shifting How Costs Are Shared: Most of OPALCO’s revenue comes from the per-kWh charge. Our cost-of-service study showed it’s fairer to spread more costs into the fixed monthly charge (Service Access Charge). This means an increase in the monthly service charge but a lower per-kWh charge.
- Updating Commercial Members Cost Allocation: The cost-of-service study also found that commercial members were subsidizing residential members (by approx. 1%) For 2026, the residential rates will be increased more than the commercial rates.
- Stability in Energy Costs: Instead of being tied only to power costs, the “energy charge adjustment” will reflect OPALCO’s overall operating margin.
- Peak Demand Information: Bills will include a new line showing your highest energy use in the month (your “peak demand”). For now, this is just information—no extra charges will be added in 2026.
- Oversize Fees: Most homes won’t see a change, but if you have a larger-than-standard meter, there will be a monthly fee ($10 for 400-amp service, $20 for 600-amp or more).
What does this mean for your bills?
- For residential members, you will likely see a 5.8% rate increase for your overall monthly bill with the increase higher in your service access charge ($67.58/month) than kWh charge ($0.1395 per kWh).
- For commercial members, your increase will be less this year depending on if you are large commercial (no notable increase) or small commercial (2.4% increase).
All expense categories are rising. This is driving higher power bills for OPALCO members for 2026 and into the foreseeable future. OPALCO will continue to encourage members to utilize our on-bill financing program, Switch It Up, to encourage beneficial electrification and energy conservation which will help members save money on their rising bills and save energy for the planet.
OPALCO is committed to programs that help its most vulnerable members keep up with the rising cost of power. The 2026 Budget increases the Energy Assist bill credit amounts to offset the rate increase. Additionally, OPALCO will continue to support and promote Project Pal for households who struggle to pay their power bills, which is a one-time grant each year during heating season. Apply for or learn more about energy assistance online.
OPALCO’s final tariff structure for 2026 will have its second read and be approved at the December 2025 Board Meeting. For the full 2026 budget report or the 2025 cost-of-service study, visit the Document Library on OPALCO’s website at www.opalco.com. If you have questions about these changes, the OPALCO team is hosting a virtual meeting on the topic on December 15th @ 5 pm via Zoom. Register for the meeting at www.opalco.com/events.
