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Financial

2009 at a glance

Consolidated net margin and earnings: $65.4 million
Cash returned to members: $52.6 million

Basin Electric responded to recent international credit market upheavals and banking difficulties by venturing into private-placement markets rather than tapping the public market to finance its construction program.

During 2009 Basin Electric entered into financing arrangements for approximately $1.165 billion in support of capital projects.

Basin Electric has been able to readily secure financing because of its strong financial metrics, financial flexibility, long-term power sale contracts through the life of the obligations, low-cost and reliable power supply resources, and sound management policies. Future plans include front-running our capital requirements, but not moving too far ahead of our resource plan.

 
Both now and in the future, Basin Electric is committed to maintaining its creditworthiness and the trust of our membership and all financial stakeholders.

A natural hedge

Basin Electric is the parent company of Dakota Gasification Company (Dakota Gas), which produces pipeline quality synthetic natural gas. This relationship buffers Basin Electric against huge price swings. That's because Basin Electric -with Dakota Gas - has a natural hedge: its peak electricity is generated from gas. As the price of gas goes up, its more costly for Basin Electric to make electricity, but Basin Electric gets a higher revenue stream from Dakota Gas because Dakota Gas produces gas. If the economy causes a reduction in natural gas prices, Basin Electric can make electricity at a lower cost. One hedge against the other - an advantage that only Dakota Gas brings. A typical electric company does not have this hedge.

Download the 2009 Annual Report (sidebar this page) or the 2010 quarterly reports, all of which is found on the Financial Reports page.

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