OPPD proposals aim to keep power reliable and rates low amidst rising costs and soaring energy demand

Omaha Public Power District’s preliminary 2026 corporate operating plan (COP) aims to keep costs down for customers despite inflationary pressures, increased regulatory requirements and increasing energy demand. Utility leaders shared their $2.98 billion budget proposal with the OPPD Board of Directors during their all-committees meeting Tuesday.

It recommends a 6.3% rate increase averaged across all customer classes. This includes a 5.8% general rate increase and a 0.5% increase to the Fuel and Purchased Power Adjustment (FPPA). The FPPA is a line item on customer bills that addresses changing fuel and purchased power costs outside of the utility’s control. Here’s the impact on each customer class starting Jan. 1, pending board approval at their December meeting:

• Residential customers: 6% increase
• Average bill of $115 would go up by about $7 a month
• Commercial customers: 3.7% average increase
• Industrial customers: 8.9% average increase

Key factors driving the rate increase include the need for more generation and transmission due to increasing demand. Even without an increase in electrical demand, the district has a regulatory requirement to have more energy-producing assets for higher levels of safety margins to serve all existing and new customers. Additionally, the district faces sharply rising costs of key utility materials, including commodities like copper, steel and concrete used to build OPPD infrastructure.

“We’re not asking customers to carry this alone,” said OPPD President and CEO Javier Fernandez.

OPPD reduced planned costs by nearly $60 million this year through a hiring freeze for all non-critical roles and by deferring or canceling a number of construction and maintenance projects to keep rates from going higher.

“We are doing everything in our power to be good financial stewards and minimize any impact on our customer-owners, and we must maintain reliability. That’s our top priority,” Fernandez said.

While inflation on labor and materials to run the utility has risen 25.2% in the past five years, the utility, which is not-for-profit, has passed only along 14.2% of that to customers. The utility’s rates remain 30% below the national average, according to the Energy Information Administration.

“We believe this rate adjustment properly balances the needed critical infrastructure to enable our community to grow as well as keep rates competitively low,” said OPPD Chief Financial Officer and Vice President for Financial Services Brad Underwood.

OPPD is budgeting for essential projects in 2026 that directly affect customer service and system performance, such as generation additions and transmission and distribution upgrades. The utility will also bury more power lines, increase tree-trimming, continue to harden the electric system against severe weather, and install more meters as existing meters reach their end of service life, among other work. We’re also delivering new functionality for customers, including a new Customer Portal, a more informative outage map and many growth projects in our community.

Vice President of Customer Service Tim McAreavey acknowledged that a rate increase of any size can be particularly difficult for customers facing hardships. “We offer a number of programs designed to help – from budget billing to energy assistance and weatherization, and we urge our customers to call us and talk through their options,” he said.

Customers can call 402-536-4131 within the Omaha calling area or 1-877-536-4131 outside of the local calling area for assistance or to learn about available programs at OPPD.com.

The preliminary COP is posted at OPPDCommunityConnect.com. Public comments will be received via that website through Dec. 14.

North Omaha Station recommendation

The rapid load growth and regulatory requirements for additional reserve generation to ensure system safety are among the factors causing OPPD to rethink the timeline for transitioning how North Omaha Station (NOS) is powered. Three of five generating units, converted from coal to natural gas in 2016, were targeted for retirement in 2026. The other two coal units were expected to be converted to natural gas.

“Today we are at a crossroads,” Fernandez told board members at their all-committees meeting this week. “The energy landscape has changed significantly and continues to change. It is time to pause and reassess how North Omaha Station fits into our future.”

OPPD continually models and plans for energy needs, which is why the utility began an infrastructure buildout in 2019. However, utility leaders said circumstances and realities change. The speed at which the grid is changing means the utility must remain nimble. OPPD’s service territory now has 23,000 customers more than it did in 2020, and energy demand has grown by approximately 500 megawatts – the same amount of load served by Grand Island and Hastings utilities combined.

NOS is bridging the gap with local, stable generation to power homes, hospitals, schools and businesses, while OPPD builds more generation for the future. Transitioning the plant too soon, utility leaders said, exposes customers to reliability risks and could diminish OPPD’s ability to prevent rolling blackouts.

OPPD’s goal of net zero carbon by 2050 is unchanged. “We are not abandoning our emissions goals but rather protecting our community while we transition responsibly,” Fernandez said.

OPPD has already reduced emissions significantly. Carbon dioxide is down 40% since 2013 and since 2015, sulfur dioxide emissions are down 50%, nitrous oxide emissions are down 40%, and mercury emissions are down more than 90%. Units 4 and 5 at NOS hold Low Emitter status under federal Mercury and Air Toxics Standards, meaning they’re below 50% of federal emissions limits.

The board will consider the NOS recommendation and could vote on it next month. Customers can learn more and provide comments at OPPDCommunityConnect.com through Dec. 14.

In other board action this evening, directors approved the September 2025 financial report, the October 2025 meeting minutes and the November 2025 agenda.

Next board meetings 

The next all-committees meeting will be held in person Tuesday, Dec. 16, at 10 a.m. at OPPD administrative offices, 1919 Aksarben Dr. in Omaha, and virtually via Webex. The meeting link and instructions will be available at OPPD.com/CommitteeAgenda, beginning at about 9:45 a.m.

The next monthly board meeting is Thursday, Dec. 18, at 5 p.m., in person at the Legislative Chamber of the Omaha-Douglas Civic Center, 1819 Farnam St., as well as virtually via Webex. The public can attend virtually via the meeting link and instructions at OPPD.com/BoardAgenda, beginning at 4:45 p.m.