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Co-ops Power You

Breaking down how electric cooperatives provide power and empower communities

Co-ops Power You

Photo by James Pratt

Neighbors helping neighbors. 

Neighbors lifting each other up. 

Neighbors coming together to achieve something greater, for the benefit of all, that they could not achieve on their own. 

This premise of collaboration and cooperation is the foundation of rural electric cooperatives. Electricity is a commodity that can easily be taken for granted—until we don’t have it. We depend on it, we expect it, and we don’t want it to be interrupted. It needs to be there 24/7, 365 days of the year to power our lives, to enhance our quality of life, to enable us to work, learn, interact, entertain and discover. Truly, electricity is a gift. But have we given any thought to what happens behind the scenes when we turn on the light switch? How many people are involved—and what chain of events takes place—to make this gift a reality? 

In this October edition, which celebrates National Cooperative Month, Oklahoma Living magazine breaks it down for you. We will learn how electric cooperatives operate based on three pillars on which they stand: cooperation, commitment and connection. Find a comfortable spot and let’s understand a bit more about the co-op that powers you. 

Cooperation 

Oklahoma’s distribution electric cooperatives were formed in the late 1930s and in the 1940s. Truthfully, this is a story built on cooperation. Farmers banded together to gain access to safe, reliable, affordable power when no one else would provide it for them. By the 1930s, there was an “electric divide” in America, and in Oklahoma. Nine out of 10 urban dwellers enjoyed the benefits of electricity while nine out of 10 rural dwellers were left in the dark. Life on the farm was difficult without electricity. There was no indoor plumbing or reliable refrigeration. Kerosene lanterns provided unsafe lighting. Household chores and farm work were full of toil and hard labor. Investor-owned utilities didn’t see the return on investment to build miles of power lines to electrify a few farms, nor did they think farmers could afford the monthly electric bill if infrastructure were put in place. President Franklin D. Roosevelt believed that if investor-owned and municipal utilities could not or would not supply electricity to rural populations, then it was the duty of the government to help facilitate a public utility enterprise: electric cooperatives. The Rural Electrification Administration (REA) was created in 1935, and the Rural Electrification Act of 1936 provided official status to the REA as a lending agency to help provide financing to electric cooperatives. With federal financing ready to go, REA representatives traveled across the country to help rural citizens band together to form not-for-profit electric distribution cooperatives in order to bring electricity to their homesteads. 

Nothing has improved the lives of rural folks like rural electrification, and it would have never been possible without collaboration and cooperation.

Fast forward 85 years; Oklahoma’s electric cooperatives now power the lives of 523,000 Oklahomans throughout all 77 counties. Plus, Oklahoma co-ops serve more than 125,000 consumer-members in surrounding states, including Arkansas, Colorado, Kansas, New Mexico and Texas. Serving primarily rural areas, their footprint covers 93% of the state’s landmass, which is made possible through maintaining 122,861 miles of power lines—enough to reach halfway to the moon! Electric cooperatives are cut from a different mold; with their member-driven focus, they stand out from other types of utilities. Co-ops are locally owned by the members they serve, and they’re governed by an elected board of directors who are member-owners of their cooperative. 

Since co-ops committed to going where other utilities wouldn’t go, they serve primarily rural areas with sparse populations—and literally cover more ground than any other utility. In fact, while investor-owned electric utilities in Oklahoma average 15 to 25 meters per mile of line, electric co-ops average only 5.68 meters per mile of line. 

“Simply put, Oklahoma’s electric cooperatives must maintain more infrastructure with less revenue per mile compared to other electric utilities in the state,” says Chris Meyers, general manager of the Oklahoma Association of Electric Cooperatives (OAEC). “To accomplish this task, co-ops structure rates and fees to recover costs and partner with other cooperatives and organizations to create cost efficiencies in supplies, insurance, financing, technology solutions and more. This means co-ops have access to a vast network of resources and services that they would not be able to create on their own.”

That’s the power of cooperation.

Commitment  

To fulfill their mission of powering lives and empowering communities, co-ops are committed to delivering safe, affordable, reliable and sustainable electricity. But what does each of these attributes mean exactly? 

Safe: Ensuring that consumers have safe electric power and that every electric co-op employee returns home safely at the end of each day is a priority for your co-op. To achieve this goal, electric co-ops nurture and enforce a strong culture of safety in their work practices. A strong culture of safety is vital to protecting more than 1,500 employees who work outdoors, including lineman, technicians and other co-op employees. All of Oklahoma’s distribution electric co-ops participate in the Rural Electric Safety Achievement Program (RESAP), a national safety program that utilizes a framework of continuous improvement to enhance safety performance and culture. Several co-ops have also signed the “Commitment to Zero” pledge, which is designed to eliminate serious injuries and fatalities.

Affordable: While safety is crucial to the cooperative program, affordability is vital for consumer-members. That’s why Oklahoma’s electric cooperatives are committed to keeping rates affordable. Market research shows that the cost of most things like cars, houses, eggs, stamps and gasoline has increased twenty-fold or more during the past 80 years; however, electricity has remained affordable. In fact, the average cost per kilowatt-hour has only increased three-fold since the 1930s. Based on data from 2019, the residential average revenue per kilowatt-hour sold for co-op consumers is 11.04 cents. Since co-ops are locally owned and governed, they aren’t in business to make profits for out-of-state shareholders; instead, they exist to improve the quality of life for their members. Co-ops go the extra mile by helping consumers use energy wisely through energy efficiency programs, rebates and incentives so members can spend their hard-earned money on other aspects of life. 

Reliable: You want your power to be there for you; therefore, reliability is a daily priority for Oklahoma’s electric cooperatives. Maintaining a safe and reliable system requires hundreds of hours of careful planning, inspections, maintenance and system upgrades. All this extra work pays off. During the past five years, Oklahoma’s electric co-ops have kept the lights on 99.99% of the time. The average Oklahoma co-op member-owner experiences one outage per year lasting 2 hours and 1 minute. That’s despite ice storms, tornadoes, wildfires and other extreme weather events that are no strangers to Oklahoma. If electric co-ops experience extensive outages due to extreme weather events, they work quickly with sister co-ops through mutual aid assistance to restore power as quickly and safely as possible. 

Sustainable: Co-ops are committed to using fuel resources wisely, in a manner that is environmentally friendly for the sustainable benefit of future generations. This commitment is reflected through energy efficiency efforts and investments in renewable energy. During the past 10 years, Oklahoma’s electric co-ops have invested nearly $24 million in energy efficiency measures, saving over 221 million kilowatt-hours. That’s enough kilowatt-hours to power more than 13,565 homes for a full year. Oklahoma’s electric co-ops lead the way in wind, solar and battery storage integration. By incorporating wind farms and utility-scale solar generation into the energy mix, co-op consumer-members benefit from renewable energy regardless of their location in the state or economic status (learn more about Oklahoma’s generation & transmission electric cooperatives on Page 12).  Several electric distribution cooperatives offer community solar subscriptions to their members who are unable to install solar but would still like to support renewable energy. As the industry continues to evolve, co-ops remain steadfast in their commitment to help members make informed decisions based on their energy needs and goals. 

Connection

Your rural electric cooperative takes pride in connecting with each consumer-member. More than a utility, co-ops are made up of neighbors who are there to take care of each other. Employees are engaged community members and so are board members who are elected by the membership to represent their districts. This connection is an ongoing cycle of everyday folks taking care of everyday folks. What’s more, co-ops are actively connected to the communities they serve because it’s their home, too. They genuinely care about members and their quality of life. 

Oklahoma’s electric cooperatives—including your own rural electric co-op—are economic engines within the communities they serve. Collectively, they employ more than 2,720 people in various job capacities. They pay more than $22 million in state and local taxes each year and make purchases of more than $1.5 billion from suppliers in the state. Co-ops also make investments in schools, including the sponsorship of several scholarships, safety education programs, student camps, the Rural Electric Youth Tour (which includes a full week in Washington, D.C.), and the payment of gross receipts taxes that go to school districts, among many other initiatives.

A generation and transmission cooperative, also known as a G&T, generates and transmits power to distribution electric cooperatives, such as your own electric co-op, which then delivers the power to the end consumer. This map highlights the G&Ts that are members of Oklahoma’s electric cooperatives.

 

“Every year co-ops pay gross receipt taxes, paying $46 million in 2018; about 95% of that went to public school districts,” says Sid Sperry, director of public relations, communications and research at OAEC. “Co-op gross receipts taxes are distributed based on the number of miles of power line in each school district.”

 In fiscal year 2019, the Oklahoma Tax Commission reports public school districts received $43.7 million paid by electric co-ops; the remaining $1.3 million went to the state of Oklahoma for administrative costs.

As part of the electric cooperative business model, which is member driven, electric co-ops pay capital credits to members based on their specific electricity usage through the years. Together, Oklahoma’s electric cooperatives returned over $37.5 million to members in 2018.

Electric cooperatives empower communities with various grant programs as well as with the Operation Round Up program, which rounds up electric bills to the next dollar to benefit community organizations and local businesses. 

For generations to come, Oklahoma’s electric cooperatives will remain steadfast in their mission of providing safe, affordable, reliable and sustainable electricity while empowering local communities to thrive and to flourish. Co-ops were built with cooperation; their commitment is to bring excellence in all they do; and their connection is to their valued members because they are neighbors helping neighbors. OKL Article End