Understanding REC's
2027 Rate Review
Our commitment: Reliable electricity. Responsible spending. Affordable service.
We know that the cost of living continues to be a concern for many families and businesses in our communities. No one wants to see their electric bill increase.
At Rappahannock Electric Cooperative (REC), we have a responsibility to manage costs carefully while maintaining the reliable electric service our members depend on every day.
In January 2027, REC plans to submit an application to the Virginia State Corporation Commission (SCC) requesting changes to its electric rates. The proposed changes reflect the costs of operating, maintaining and investing in the electric system, with a focus on keeping electricity affordable and ensuring costs are fairly assigned.
This will be REC's first comprehensive rate review since rates established in 2018.
No rate changes are taking effect at this time. The application has not yet been filed, and the proposed changes will be subject to regulatory review.
This page explains why REC is requesting a rate review, what the proposed changes could mean for your bill, the steps REC is taking to manage costs, and what happens next.
What could this mean for your electric bill?
REC's preliminary proposal would increase the average residential electric bill by approximately 4%.
For a residential member using 1,000 kilowatt-hours (kWh) of electricity per month, the estimated increase would be approximately $9 per month.
The actual impact would vary depending on your electricity use and the final rates.
Understanding what is changing
Your electric bill includes two primary costs:
Electricity supply: The cost of the electricity you use.
Electric delivery: The cost of bringing electricity to your home or business through REC's network of poles, wires, substations and other equipment.
The proposed rate increase focuses on the cost of delivering electricity.
REC also plans to simplify how electricity supply costs appear on bills. These proposed adjustments would change how supply costs are presented and collected, without increasing the total amount collected for electricity supply.
When would changes take effect?
REC anticipates proposing an effective date of September 1, 2027. The timing and final rates are subject to the SCC's review process.
Why is REC reviewing its rates?
Providing reliable electricity requires ongoing work to maintain and improve the electric system. REC must maintain thousands of miles of power lines, replace aging equipment, manage trees and vegetation near power lines, respond to outages, and make improvements to serve members safely and reliably.
The costs of performing this work have continued to increase.
REC's upcoming rate application will use its actual 2025 operating expenses and financial information as a foundation for determining the rates needed to support electric service.
Why are costs from 2025 being considered in a 2027 rate application?
Electric rates are not automatically adjusted each year to reflect every change in the cost of providing service.
Instead, REC periodically completes a detailed review of its expenses and investments. That review uses financial information from a completed year to establish a documented basis for proposed rates.
For this application, REC is using 2025 as that starting point.
This does not mean members are being billed again for electricity they used in 2025. It means REC is using documented costs from that year to help determine the rates needed to provide reliable service going forward.
What do these costs support?
Maintaining reliable service
Inspecting and maintaining equipment, clearing vegetation around power lines, replacing aging infrastructure, and responding to outages and severe weather.
Investing in the electric system
Maintaining and upgrading substations, power lines, poles and other equipment to support reliable service today and into the future.
Supporting members
Providing customer service, billing, outage communications and the day-to-day services members rely on.
Managing the cost of infrastructure
Paying for and maintaining long-term investments in the electric system, including the financing costs associated with those investments.
REC's responsibility is to balance these needs while carefully managing costs and keeping electric service as affordable as possible.
Putting rising costs into perspective
REC's annual operating and maintenance expenses increased from approximately $106 million in 2023 to $125 million in 2025.
These expenses include maintaining power lines and equipment, managing vegetation, supporting members and operating the electric system.
By 2028, REC projects these annual costs will reach approximately $132 million.
That is an increase of approximately 24% compared with 2023.
REC continues to evaluate spending and look for efficiencies to help manage these costs while maintaining reliable service.
Breaking Down Rising Energy Costs
Updated 2026 %
Pole-mount transformer
What is REC doing to keep costs down?
We understand that before asking members to pay more for electricity, REC must do its part to manage expenses and find ways to operate more efficiently.
That responsibility guides how we plan investments, maintain our electric system and look for opportunities to reduce costs.
Here are some of the ways REC is working to manage costs:
Bringing in outside funding
Since 2024, REC has secured more than $45 million in grant funding to support projects and investments. This funding helps offset costs that would otherwise need to be covered through other sources.
Generating revenue from existing assets
REC makes better use of its existing infrastructure by leasing space on utility poles and providing access to fiber-optic infrastructure.
These activities are expected to generate approximately $8 million in revenue and earnings in 2025 and 2026, helping support Cooperative operations.
Reducing the cost of electricity
REC looks for opportunities to reduce the cost of purchasing electricity.
- REC's Summer Savings Plan delivered approximately $302,000 in net savings in 2025, along with more than $33,000 in rebates to participating members.
- Battery storage allows REC to reduce power needs during periods when electricity costs are highest, contributing to more than $1 million in wholesale power cost savings since 2021.
Protecting members from data center costs
REC has established measures to help protect existing members from costs associated with serving large electricity users, including data centers.
Data center members are required to fully cover the cost of infrastructure needed to serve their facilities. By the end of 2025, REC had collected $345 million in infrastructure costs, helping protect existing members from costs associated with these new loads.
Investing in long-term reliability
Preventive maintenance helps REC reduce the risk of equipment failures and avoid more expensive repairs.
REC is investing more than $30 million in vegetation management in 2025 and 2026, helping reduce outage risks from trees and vegetation near power lines.
Our commitment continues
No single strategy can offset all the rising costs facing the energy industry. But by managing the expenses we can control, finding new sources of funding and revenue, and making responsible investments, REC is working to keep reliable electricity as affordable as possible.
Every dollar matters. REC will continue looking for opportunities to control costs, improve efficiency and provide reliable electric service at an affordable price.
Frequently Asked Questions
Why is REC requesting a rate increase?
The cost of operating, maintaining and investing in REC's electric system has continued to increase. REC is preparing a comprehensive review of its rates to reflect the cost of providing reliable electric delivery service. The proposal also aims to simplify bills and more accurately assign costs among different types of members.
Why is REC using costs from 2025?
Electric rates are established through a regulatory process using documented financial information. REC is using 2025 as the historical starting point for its proposed rates. Members are not being charged again for electricity used in 2025. The information helps determine the rates needed to support future service.
Why can't REC just reduce spending instead?
Controlling costs is an ongoing responsibility. REC works to generate additional revenue, manage electricity expenses, maintain existing equipment and carefully evaluate investments. However, essential work such as maintaining power lines, managing vegetation, replacing aging equipment and responding to outages must continue to provide safe and reliable service.
How much could my bill increase?
Preliminary estimates indicate an increase of approximately $9 per month, or about 4%, for a residential member using 1,000 kWh monthly. Actual impacts will vary. The proposal is not final and remains subject to regulatory review.
Are residential members paying for data centers?
REC has established measures intended to protect existing members from costs directly associated with serving large electricity users, including data centers. These include specialized rates, direct payment for dedicated infrastructure and financial protections. REC's upcoming rate application will address the allocation of costs among different member classes.
Why does REC need a rate increase if it is a not-for-profit cooperative?
As a not-for-profit electric cooperative, REC operates to serve its members rather than outside shareholders. However, REC must still collect enough revenue to operate, maintain and invest in the electric system, meet its financial obligations and support reliable service.
Has REC already filed its application?
No. REC currently anticipates filing its application with the Virginia State Corporation Commission in January 2027. The formal application and supporting materials will become available through the regulatory process after filing.
When would new rates take effect?
REC anticipates proposing September 1, 2027, as the effective date. The final timing and rates will be subject to the SCC's regulatory process, including any applicable provisions for rates subject to refund.
Official Notice and Rate Review Process
REC is providing advance notice of its intention to submit an application for proposed rate changes to the Virginia State Corporation Commission (SCC).
The SCC is responsible for reviewing REC's application and determining whether the proposed rates meet applicable regulatory requirements.
Official Notice
Notice is hereby given to all member-owners of Rappahannock Electric Cooperative that the Cooperative anticipates filing a general rate case application with the Virginia State Corporation Commission on or after Jan. 4, 2027.
What happens next?
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November 2026 — Advance Notice
REC informs members of its intention to seek changes to electric rates.
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January 2027 — Planned Application Filing
REC anticipates submitting its formal application, including supporting financial information and proposed rate schedules, to the SCC.
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Following the Filing — Regulatory Review
The SCC will establish the review process, including opportunities for public comment and participation. Additional information and official documents will become available.
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September 2027 — Proposed Effective Date
REC anticipates proposing that new rates take effect September 1, 2027, subject to applicable regulatory requirements and the SCC's review.
Where can I find more information?
REC will update this webpage as additional information becomes available.
Once the application has been filed, members will be able to access the public filing documents and information about participating in the SCC's review process.
We're here to help
We know managing household and business expenses can be challenging.
REC offers resources to help members understand their electric bills, manage electricity use and explore available billing and assistance options.
Whether you're looking for ways to use less electricity, want help understanding your bill, or need information about payment assistance, REC is here to help.
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