All Nebraska Public Power District employees will receive 2.5 percent raises next year, and some will receive merit raises on top of that.
The utility's board approved spending $4.21 million on employee raises at its Friday meeting even though NPPD expects to finish 2012 with a $4 million deficit.
The utility decided to go ahead with the raises to recognize how its 2,200 employees performed and because NPPD found that comparable utilities were offering raises of 2.9 percent next year on average.
Human resources manager Laurie Schilling says the raises will ensure that NPPD remains competitive with other utilities.
NPPD customers will see their rates increase 3.75 percent on average starting Jan. 1.