DEMCO Secures New Wholesale Power Contract

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DEMCO (Dixie Electric Membership Corporation) announced today that it will enter into a 10-year all-requirements contract with Cleco Power, LLC, a subsidiary of Cleco Corporation, to purchase wholesale power for the nearly 100,000 members that the electric cooperative serves in seven southeast Louisiana parishes.  The contract will take effect in April 2014.

DEMCO signed a wholesale power contract in 2000 with Louisiana Generating (NRG) in New Roads, Louisiana, which was extended in 2004, and is set to expire in March of 2014.  Under the current agreement, DEMCO members have profited from relatively flat fuel rates, which translated into substantial cost savings for its consumers throughout the entire contract.    

DEMCO’s board of directors and its executive leadership recently concluded an exhaustive search for a wholesale provider that could supply the 578 megawatts needed for its members in Ascension, East Baton Rouge, East Feliciana, Livingston, St. Helena, Tangipahoa and West Feliciana parishes.  Cleco Power, LLC was selected because of its diverse generation portfolio that will assist DEMCO in mitigating risks associated with volatile fuel commodity prices, tighter environmental regulations and reliability. The details of the contract between the two companies will allow the electric cooperative to meet these goals and to continue to provide power rates that are competitive with other local providers as well as electric utilities throughout the state and region.

DEMCO officials are also confident about the ability of Cleco to meet the demands for power required by the DEMCO membership.  “DEMCO is pleased to have successfully negotiated a power contract with Cleco,” said DEMCO CEO and General Manager John Vranic.  “We will see a positive impact on the communities served by DEMCO.  Cleco’s ability to supply our growing membership while keeping costs down is something we feel is beneficial to our membership.” 

The areas served by the electric cooperative, specifically Livingston and Ascension parishes, are some of the fastest growing communities in Louisiana, as well as the Southeast region.  Vranic continued, “This contract will enable DEMCO to deliver the best quality product at the best possible price to its members for years to come.  Providing safe, reliable and affordable power to our members is at the heart of our mission.  This contract does just that.”

DEMCO and Cleco Power LLC are presenting the contract to the Louisiana Public Service Commission and the Rural Utilities Service for regulatory approval.


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