Where your power begins

Flipping a switch is simple. What happens behind the scenes is anything but.

As a member of a rural electric cooperative, you own the power your community depends on every day. Being a member of a cooperative means you have a stake on the service that critically benefits the cooperative membership. As a member, it’s important to understand how your electric power is coordinated and ultimately delivered.

You may have heard of terms such as the Southwest Power Pool (SPP), generation and transmission cooperative (G&T) or a regional transmission organization (RTO). Here’s a breakdown of how Oklahoma’s electric cooperatives fit into the puzzle and how it impacts you and your community.

Southwest Power Pool:

SPP is an RTO that functions much like an air traffic controller for electricity, coordinating the movement of power across its footprint that includes Oklahoma. As a new development, the Southwest Power Pool announced an expansion of its service territory to the west. With this recent expansion, SPP now serves a 732,000 square-mile region comprising all or parts of 17 states.

SPP plays a critical role in ensuring grid reliability, maintaining adequate transmission infrastructure and fostering competitive wholesale electricity markets across the central United States. It monitors the flow of electricity across its footprint, responding in real time to transmission congestion, generation outages and fluctuations in demand. By leveraging a diverse fleet of generation resources, SPP ensures that supply and demand remain balanced.

Two of the three G&Ts that are owned by distribution electric cooperatives in Oklahoma are member utilities of SPP:

• Western Farmers Electric Cooperative (WFEC), headquartered in Anadarko, serves 17 distribution cooperatives in Oklahoma and four in New Mexico.
• Golden Spread Electric Cooperative, based in Amarillo, which supplies wholesale power to the Oklahoma Panhandle through distribution cooperative TCEC.

SPP operates an energy marketplace that allows utilities to buy and sell electricity efficiently. Through its day-ahead market, the system selects the lowest-cost generation available to meet projected demand while maintaining reliability. For member utilities, this structure offers reduced risk. If a major generation unit goes offline or unexpected conditions arise, the broader SPP market absorbs the impact, ensuring that electricity continues to flow to consumers without disruption.

Three-Tiered System Cooperative Approach:

Another model of regional coordinating is a cooperative-driven three-tiered approach in which distribution cooperatives own their G&T, and those G&Ts collectively own the generation cooperative.

Nine distribution co-ops in Oklahoma are part of a three-tiered system through their membership in KAMO Power, a G&T cooperative based in Vinita. KAMO is one of six G&Ts that jointly own Associated Electric Cooperative Inc., a wholesale generation cooperative responsible for producing reliable and affordable electricity for its members.

KAMO Power’s participation in the Associated system offers several key advantages. This structure reinforces local control while enabling large-scale coordination.

The system also allows each tier to focus on its strengths. The distribution cooperatives deliver electricity directly to residences, businesses and industrial accounts; KAMO Power concentrates on operating and maintaining transmission infrastructure; and Associated manages generation and power supply. This division of responsibilities enhances efficiency and reliability across the network.

Economies of scale further strengthen the model. By combining resources, the cooperatives reduce administrative costs, improve operational efficiency and maintain competitive power rates. The interconnected transmission network also provides access to broader energy markets, increasing flexibility and resilience.

Associated participates in energy markets, buying and selling power when it benefits its members.

Balancing affordability, reliability and innovation remains critical as the energy landscape evolves. Whether through the regional coordination of SPP or a three-tier cooperative-driven model, the shared goal remains the same: to deliver safe, affordable and reliable power to each member at the end of the line.

Let’s define it:

Distribution electric cooperative: An electric cooperative that purchases wholesale power and delivers it to members.

Generation and transmission electric cooperative: A power-supply cooperative owned by a group of distribution cooperatives.

Regional transmission organization: An independent, federally regulated non-profit entity that operates and control the electric transmission grid across a large, multi-state region.

Southwest Power Pool: A non-profit regional transmission organization mandated by the Federal Energy Regulatory Commission to ensure reliable power supplies, adequate transmission infrastructure and competitive wholesale electricity prices.

Three-tiered system: An approach based on the co-op business model of distribution co-ops (first tier) owning their generation and transmission co-ops (second tier), which came together to own the wholesale generation cooperative (third tier).