The Future is Now for Distribution Cooperatives

There is an adage in the cooperative electric business that “if you have seen one cooperative, you have seen one cooperative.” And we think that holds true. But in today’s rapidly transitioning energy supply space—due to the continued proliferation of low-cost and clean energy generation—there is commonality across cooperatives and regions of the country on one topic in particular: we need increased flexibility in the generation and transmission association model.

Each of the cooperatives we lead are looking to harness the benefits of the ongoing energy transition for our member-owners and the regions of the country that we serve. As this transition gains momentum, it has become clear that distribution cooperatives could band together in order to establish more equitable and flexible power supply arrangements, restore control over power supply decisions, and ensure distribution cooperatives are properly positioned for a secure, reliable, and affordable energy future. As a result, the NextGen Co-op Alliance (NGCA) was formed.

In talking with and telling our story to one another, we realized that—while each of our cooperatives is unique—our efforts and the stories around our respective efforts have common threads. As we have sought a different energy future for the communities we serve, we have experienced delay and inflexibility from our wholesale electric providers—and an abdication of the seven cooperative principles each of our utilities were founded upon.  These cooperative principles are our unifying bond, and we need to remain true to them in order to advance the energy future that our member-owners want and this country needs. Distribution cooperatives like the ones that we have the privilege to run are facing a seismic shift in what our members want – from lower rates to broadband deployment to clean energy to local investment and community partnerships in power supply that drives jobs and keeps their money in their community.

From our conversations among one another, it is clear that our stories are neither regional- nor wholesale provider-specific. Our respective struggles share a common root at the foot of the tree that is today’s iteration of the generation and transmission association model—a model that our member-owner boards in the distribution cooperatives created—has worked well to achieve 1930s New Deal rural electrification objectives, but requires evolution and reform to meet the pace of change in the power business today. For this reason, we need to work together to deliver the energy future our member-owners want and are forming the NGCA for that purpose.

Through the NGCA we want to work with our local communities to provide more benefits by reforming the generation and transmission association model and find ways to better meet the needs of our cooperative member-owners. We want to collaborate to restore the seven cooperative principles in our wholesale power arrangements, the very principles that, once upon a time, we used as the foundation when we—the distribution cooperatives—created the generation and transmission association model.

Equally as important, we want to keep and strengthen the connection we have to our communities. We need to recognize that, with the generation and transmission association model of today, we have lost some of the connection to our member-owners. We are doing this for them, we were created by them, and we must restore the vision that we serve them by keeping pace with a rapidly changing energy environment.

NGCA plans to play a role in the national debate by amplifying the voices that have been excluded, overlooked and treated as merely a transaction. We will promote diversity of thought among cooperatives that is currently stifled in order to create cleaner and more cost-effective power supply coupled with the restoration of local control over power supply decisions to meet the needs of the member-owners we serve. The generation and transmission association model and rural power delivery must change, and NGCA is the agent to do it. The future of electric cooperatives is now, and this alliance here to make it happen.

Signed,

Jessica Matlock, NextGen Chair; CEO, La Plata Electric Association, Inc., Durango, Colo.

Luis Reyes, NextGen Vice Chair; CEO, Kit Carson Electric Cooperative, Taos, N.M.

Ron Holcomb, NextGen Treasurer; CEO, Tipmont Rural Electric Membership Corporation, Linden, Ind.

Chad Felderman, NextGen Secretary; CEO, Dakota Energy Cooperative, Huron, S.D.

Brad Zaporski, NextGen Board Member; CEO, San Miguel Power Association, Ridgway, Colo.