New RESCO-Supported Grid Price Index Tool Provides Current Product Costs, Assists Utilities in Future Planning

A new industry benchmark index developed by the National Rural Utilities Cooperative Finance Corporation (CFC) and the nation’s electric supply cooperatives—including RESCO—was announced yesterday with a goal to help cooperative leaders better understand cost changes and communicate their impact to directors and members.

The CFC Grid Price Index (GPI) tracks changes in the cost of electric distribution equipment using actual supplier wholesale purchase data from cooperative supply organizations nationwide. Built around a fixed basket of equipment and a 2019 pre-COVID baseline, the index measures inflation across key distribution categories, including transformers, conductors, switchgear and utility hardware.

RESCO played a prominent role in the development of the Index, given the need for greater explanation and understanding of the impact inflation has on the operations of our nation’s cooperatives.

“The new inflation index will provide members with a reliable and objective tool to better understand the impact of inflation on their operations, budgets and capital planning efforts,” said RESCO President and CEO Matt Brandrup.

WHAT IT SHOWS

The GPI tracks the prices supply cooperatives pay manufacturers and compares those costs against 2019 levels using current purchasing patterns.

The methodology isolates changes in material costs and provides both an overall index and category-level subindices.

For directors, that means access to an objective benchmark grounded in real-world utility purchasing data.

The findings underscore the scale of inflationary pressures experienced across the utility supply chain. Overall, the GPI indicates electric distribution equipment costs have more than doubled since 2019.

Category-level findings show significant differences across equipment types:

• Underground cable accessories: approximately 143% increase since 2019.
• Utility hardware: approximately 135% increase.
• Enclosures, pedestals and pads: approximately 114% increase.
• Overhead conductors: roughly 105% increase.
• Transformers: nearly 96% increase.
• Underground conductors: roughly 95% increase.
• Switching and protection equipment: nearly 90% increase.

These benchmarks can help board of directors better understand how inflation is affecting specific portions of a cooperative’s work plan and capital portfolio.

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