What began with thinking strategically a few years ago, is leading today to new opportunities.
Lake Region Electric Cooperative will be participating in a joint effort to deliver natural gas to the Deer Creek and Parkers Prairie areas. The cooperative’s board of directors recently approved the joint effort with Greater Minnesota Gas, based in Le Sueur, MN.
Greater Minnesota Gas will provide the intrastate pipeline to bring a supply of natural gas to the Deer Creek and Parkers Prairie communities and natural gas termination points within the region. From there, Lake Region Electric Cooperative will own and maintain the distribution pipeline that serves the natural gas customers.
Construction of natural gas distribution infrastructure will begin in spring. The $1.6 million investment by Lake Region is expected to have gas flowing by August 2017. A contracting firm will install the pipes. Franchise agreements have been approved by the cities of Deer Creek and Parkers Prairie and minimum burn agreements have already been signed with large users. These large customers have expressed their pleasure in Lake Region taking this important step. Informational meetings will be scheduled in the area.
Why get into the natural gas business?
Basically, the answer is serving an unmet need in this underserved region — something that is at the core of our cooperative principles. It comes down to helping consumers increase productivity and lower costs. The project with Greater Minnesota Gas represents a cooperative solution to the desire of many people in these two communities and the surrounding area to have access to natural gas service.
It is also a recognition that without taking such steps, Lake Region will lose an important source revenue. Through the years, there has been a build out for natural gas into Lake Region’s service territory. As more homes, agricultural facilities, and businesses connect, Lake Region’s share of heating and water heating sales have continued to erode.
Additionally, we’ve already seen an expansion of natural gas service in Becker and Otter Tail Counties, particularly Barnesville, Pelican Lake, Little Lake Cormorant, Big Lake Cormorant, and Battle Lake. We recognized the potential long-term financial impact of eroding sales on Lake Region and this is what prompted us to develop a mutually beneficial relationship with Greater Minnesota Gas.
We are excited to take this new step in diversifying service to this region. Judging from the support we have already received for the project, people in the Deer Creek and Parkers Prairie areas are equally excited.
Members of Lake Region Electric Cooperative recently met in three district meetings across our service territory. Since the board of directors had just approved the natural gas project, the meetings provided a good opportunity to discuss the strategy and steps involved in the project. The reaction among members was generally very positive, expressing appreciation for Lake Region’s willingness to make important infrastructure investments that will provide new opportunities to area residents and businesses.