Driving energy growth

Oklahoma’s electric cooperatives respond to increasing power demand

Rising power demand is a nationwide reality. It is hitting close to home.

As technology evolves, dependence on electricity escalates, impacting almost every aspect of life from homes, businesses, education, health care, transportation as well as industries of all types and sizes.

Recent reports show America’s peak demand is forecast to grow by 38 gigawatts through 2029. To put that in perspective, this estimated growth is the equivalent of adding another California-sized state to the nation’s power grid. At the same time, power producers plan to retire more than 110 gigawatts of baseload generation by 2033.

The National Rural Electric Cooperative Association (NRECA) warns that electricity demand is skyrocketing while always-available baseload power is being forced to retire before it can be reliably replaced.

When demand outpaces supply, what follows are cost and resource availability impacts. Affordability and reliability are a priority for Oklahoma’s electric cooperatives. Co-ops are committed to powering and empowering local communities at a cost families and businesses can afford.

Residential & Commercial Load Growth

Two generation and transmission electric cooperatives in Oklahoma report seeing rising demands during the winter months from residential heating needs.

KAMO Power is a generation and transmission cooperative based in Vinita, Oklahoma. According to CEO Ted Hilmes, the cooperative is a winter-peaking system and has identified winter heating needs as a driver for power demand.

“We experience peaks during extreme weather conditions and have noticed more homes are going all electric,” Hilmes said. “Close coordination between KAMO and our distribution cooperatives ensures our systems function together to meet increases in requirements reliably and affordably.”

A similar trend has been observed at Western Farmers Electric Cooperative, a generation and transmission cooperative based in Anadarko, Oklahoma. According to CEO Gary Roulet, the co-op estimates its winter load forecasts nearly triples from the average annual load forecast.

“Our average yearly growth is about 15 to 20 megawatts (MW), but for winter months we expect that to grow around 40 to 50 MW,” Roulet said. “Use of space heaters, and heat pump systems in all-electric homes that use back-up resistance heat when the temperatures go below 35 degrees account for the higher winter growth rates.”

While winter poses significant demand increases, summer months also bring load challenges, with high temperatures driving up air conditioning use and irrigation demands for farms. Roulet added rural lifestyles can lead to more energy consumption than urban areas as some rural residences may use more energy to tend for livestock, ensure well house heating or maintain agricultural machinery needs.

In addition to increased heating consumption, both KAMO Power and Western Farmers work to continuously ensure sufficient capacity for manufacturing and organic member growth as their distribution cooperatives serve more residential and commercial members. To respond to growing demand, both generation and transmission cooperatives are currently engaged in power plant construction projects, which will be powered by natural gas and are expected to be commercial in the next two to five years.

High Tech Loads

According to the Energy Information Administration, Oklahoma is No. 6 in the nation of 10 top states that have experienced growth in commercial sector electricity consumption. The increase is driven by computing facility growth such as data centers or cryptocurrency loads.

KAMO Power has experienced a significant increase in inquiries coming from data center developers as well as cryptocurrency loads. Hilmes explained data center loads are highly capital intensive and require costly feasibility studies as well as the need for investments on generation and transmission infrastructure. These loads must be approached carefully to ensure no risk is passed on to members.

“We work with potential loads to do necessary transmission studies and discuss options for a generation supply that meets their needs and does not place financial risk on the cooperative and our members,” Hilmes said.

Stephanie Crawford, regulatory affairs director for NRECA, says electric cooperatives nationwide are getting multiple requests for projects in the hundreds of megawatts.

“A decade ago, a huge commercial project might have boosted a co-op’s total load by 20 or 30 megawatts. It’s not only a question of needing to build or obtain more capacity, but in many cases, it creates questions about the availability of transmission and distribution,” Crawford said.

Western Farmers has been approached by large data center developers as well. Roulet explained that some of them require significant high capacity such as 500 MW or 1,000 MW. Roulet said these types of loads have a long path towards feasibility to serve and are met with supply constraints. They also require the availability of generators, transmission interconnection, permitting, water sources and fuel sources in a time where there is no excess generation.

There are smaller data center loads in the range of 20 MW that may be more feasible to serve but still require significant investment in upfront fees and extensive, costly studies.

“Being proactive and reaching out to understand how a commercial account’s energy needs may be changing in the coming years will inform conversations and decisions about timing, rate design and other factors,” Crawford said. “That will help co-ops serve emerging needs while protecting reliability for all its members.”