Seeing is never believing: we interpret what we see in the light of what we believe.
—Wisdom from Oswald Chambers
I really love this piece of wisdom, especially when I apply it to the year of 2020. We entered 2020 facing the prospect of a pandemic. Having never experienced a pandemic, personally or while managing a business, I believed we were ready. We reviewed the pandemic plan which is part of our comprehensive emergency operations plan. Our interpretation, based on what we knew about pandemics, was we believed we were ready.
Fast forward to 2021. Our interpretation, based on what we now know about pandemics, is we were ready and your Cooperative had a successful year, in spite of the pandemic. Here are some of the ways we are defining a successful year.
We are an ESSENTIAL BUSINESS every day, not just during a pandemic. The pandemic plan we had going into 2020 gave us a solid foundation for protecting the health of our employees and members while still keeping the lights on. But the plan has vastly improved from this real-world experience.
Because we are a locally-owned and governed cooperative business, we were able to make new decisions daily to keep this essential business operating. We didn’t have to consult with board members who were scattered out across the country or worry about returning a profit to distant shareholders. All 12 board members live locally in the communities we serve. They were accessible daily and gave us vital input on how to keep all of our communities safe, while keeping the lights on.
We knew our first concern was HEALTHY EMPLOYEES. We must have healthy employees reporting to duty every day to keep the lights on. Every decision we made seemed hard, but temporarily closing our lobbies in March was at the top of the list. Our connection to our members is at the heart of this cooperative business, and has been for 84 years. Our members graciously understood and appreciated how we cared about employee and member safety. The positive outcome is more members learned all of the other ways we are available to them. Our drive-thru in Lubbock and payment drop boxes at every service office continued to serve our members who like doing business in-person. Cash-paying members used our CheckOut program to pay at any Dollar General, Family Dollar or CVS. A record number of members continue to use our online bill pay and the SPEC App. And we never stopped answering the phone.
The second layer of healthy employees involved WORKING FROM HOME. Or at least that was the case for our office personnel. Our IT department successfully moved over 50 employees to home work stations. Member service representatives continued to serve member needs from the safety of their homes, including securely taking payments. Our outside crews didn’t have the work-from-home opportunity, but they ably modified every procedure from picking up material to riding to the job site to doing tailboards to completing each job—safely. The consequences of having a whole construction crew out for at least 14 days motivated everyone to make adjustments to keep the lights on.
What was the FINANCIAL IMPACT? Your Cooperative had a strong financial year with operating margins up 48%. We lost revenue with oil prices at historic lows and production down, schools closed and businesses operating at reduced levels or closed. We gained enough revenue from our residential members being at home to more than offset any losses. Our irrigation load was at normal levels. The balance sheet on the next page gives you all of the details. We have returned over $50 million in capital credits to our members, and the board will be making a decision for this year after their strategic planning session in September.
As if the pandemic didn’t test our mettle enough, we conquered a historic WINTER STORM. Ice break Billy hit us in October 2020. The ice and wind damage to the system was massive, but we design our system to serve members from more than one direction, in most cases. In three days, we had service restored to every residential member, one way or another. It took a week to restore service to oil and irrigation load, and months to clean up the debris. Another historical storm, Winter Storm Uri, visited us in February of this year. This story is still being written, so we’ll save those details for next year’s report.
No matter how good our financials look or how well we keep the lights on, no year would be a success if we fail our LOCAL COMMUNITIES. We annually support hundreds of activities and events in our local communities, because it improves the quality of life for our members. And we live in these communities, too. With fundraising events canceled, we still contributed our budgeted contributions so these groups could continue to serve our communities.
If we truly do interpret what we see by what we believe, I see an EVER-BRIGHTENING future for South Plains Electric because I believe in the cooperative business model and the members we serve.