Wiktor Wise
Electric cooperatives, or co-ops, are not-for-profit, democratic organizations that provide electricity to their members. They are owned and controlled by the people who use their services, with each member having an equal say in how the cooperative is run. Electric co-ops are found in many parts of the world, including the United States, the United Kingdom, France, and the Philippines, and they play a crucial role in providing power to rural communities that may not be served by investor-owned utilities. Co-ops also strive to keep rates affordable for their members and have a strong commitment to environmental sustainability and community support.
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What You'll Learn
Electric co-ops are not-for-profit, democratically-run organisations
Electric cooperatives, or co-ops, are not-for-profit, democratically-run organisations. They are owned and controlled by the people who use their services, with each customer being a member and owner of the business. This means that all members have equal authority and participate in the financial success of the cooperative through decreased service costs. As not-for-profit organisations, electric co-ops return over $1 billion to their consumer-members annually.
Electric co-ops are run democratically, with members voting to elect a board of directors, who hire and manage the team responsible for day-to-day operations. This democratic structure encourages member participation and provides members with a voice in the cooperative.
Co-ops serve over 42 million people, including 92% of persistently impoverished counties, and power over 22 million businesses, homes, schools and farms in 48 states. They are committed to serving their communities and are among the largest taxpayers in their states. Electric co-ops support local businesses by keeping money in the area and creating jobs for residents.
Electric co-ops are leading the way in cutting carbon emissions and adopting renewable energy sources. In 2023, co-ops added over 1.3 gigawatts of new renewable capacity, and they have announced plans to add 5.3 gigawatts more by 2027. Co-ops are also investing in clean energy technologies, including solar, hydroelectric and battery storage.
Electric cooperatives emerged to meet the needs of rural communities that were not being served by for-profit power companies. Today, they continue to provide essential power services to millions of people and drive progress towards a more sustainable and inclusive economy.
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They are owned and controlled by their customers
Electric cooperatives, or co-ops, are owned and controlled by their customers. This means that customers are also members of the cooperative, with democratic control and a say in how it is run. Each member has an equal vote and can elect a board of directors to oversee the day-to-day operations of the utility. This is in contrast to investor-owned utilities, where individual authority is linked to the number of shares held.
The cooperative model is based on mutual assistance towards a common goal. Electric co-ops are not-for-profit, and any profits are reinvested in infrastructure or returned to members in the form of capital credits or reduced costs. This model ensures that the cooperative is working in the best interests of its members and keeps rates affordable.
The first documented cooperative was the Rochdale Society of Equitable Pioneers in 1844, which established the Rochdale Principles that now govern cooperatives worldwide. Electric cooperatives specifically emerged in the early 1900s, as part of Franklin D. Roosevelt's New Deal, to bring power to rural areas that were not served by investor-owned utilities.
Today, electric co-ops serve over 42 million people in the United States, with a presence in 47 states. They provide power to over half of the United States' land mass and are leading the way in renewable energy solutions, with a focus on reducing emissions and increasing renewable capacity.
Electric co-ops are committed to serving their communities and creating local jobs. They are among the largest taxpayers in their states and often support local businesses and families in need. This commitment to their members and the environment has resulted in higher customer satisfaction scores than investor-owned utilities.
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Co-ops serve 42 million people in the US
Electric cooperatives, or co-ops, are non-profit, democratic organizations that provide electricity and other services to their members. They are owned and governed by their members, who typically have a say in the cooperative's operations and receive capital credits. Co-ops serve around 42 million people in the United States, which equates to about one-third of the nation's electric utility industry.
Co-ops are present in 47 or 48 states and power over 22 million businesses, homes, schools, and farms. They are especially important in rural areas, where they provide a source of market and economic development for both producers and consumers. In fact, electric co-ops were born out of the need to electrify rural America in the early 1900s, when utility companies believed it wouldn't be profitable to build power lines in these regions. The Rural Electrification Act of 1935 addressed this issue, leading to the creation of electric cooperatives.
Co-ops are committed to providing safe, reliable, and affordable electricity to their members. They return more than $1 billion annually to their consumer-members and invest $15 billion annually in their communities. They also play a role in reducing emissions and incorporating renewable energy sources, such as wind farms and solar arrays, into their energy generation. In 2023, co-ops added over 1.3 gigawatts of new renewable capacity, and they have announced plans to add more than 5.3 gigawatts of renewable capacity by 2027.
Co-ops are locally owned and operated, with members having the opportunity to participate democratically, such as by voting to elect a board of directors. This democratic structure sets co-ops apart from other utility companies, which are typically investor-owned or publicly owned. As of early 2024, over 60 cooperatives in 30 states are negotiating for federal funding to support their communities through programs included in the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.
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They are leading the way in cutting carbon emissions
Electric cooperatives, or co-ops, are not-for-profit organisations that are built by and serve the communities they operate in. They are democratically managed, with members voting to elect a board of directors that oversees the day-to-day operations of the utility.
Co-ops are widespread in the United States, with over 960 electric cooperatives serving 42 million members in 47 states. They are particularly prevalent in rural areas, where they were established to meet the need for reliable and affordable electricity in places that were deemed "unprofitable" by investor-owned utilities.
Co-ops are leading the way in cutting carbon emissions. They have significantly reduced their emissions of carbon dioxide, nitrogen oxide, and sulphur dioxide since 2005. They have also added substantial renewable capacity, with wind farms and solar arrays now generating enough electricity to power over 3.5 million homes.
Co-ops have announced plans to further increase their renewable capacity through 2027 and are leveraging new infrastructure funds to support their communities' transition to clean energy. They are also actively working to expand their services to provide broadband access to their members.
Co-ops' focus on serving their communities and their pioneering work in alternative and clean energy solutions make them leaders in the effort to reduce carbon emissions and transition to a more electrified economy. Their emphasis on reliability and pragmatism in energy policy ensures that they can continue to meet the needs of their members while cutting emissions.
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Co-ops are committed to sustainability and supporting local communities
The cooperative or co-op model involves "mutual assistance in working toward a common goal". Co-ops are committed to sustainability and supporting local communities.
Co-ops are dedicated to building sustainable communities and caring for the environment. For instance, the Loop Program, which aims to reduce food waste, is a collaborative effort between 30 Co-op associations and local farmers in over 60 communities. Co-op has also joined the Canadian Plastics Pact to reduce the environmental impact of plastics. Additionally, Co-op is investing in renewable energy sources, such as wind farms, solar arrays, and hydroelectric power, to reduce emissions and create more environmentally friendly fuels.
Co-ops also support local communities by sourcing products from local businesses, keeping money within the community, and reducing CO2 emissions from food transport. They contribute to community projects and initiatives, such as making donations to local non-profits and supporting small-scale farmers. Co-ops also provide education and employment opportunities for young people, promoting fair access to education and inspiring a new generation of ambitious and skilled individuals.
Co-ops foster a sense of community and social responsibility. During the pandemic, co-op members experienced a strong sense of connection and commitment to each other and their community. Co-ops also empower members to have a voice and participate in decision-making through democratic means, such as electing a board of directors.
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Frequently asked questions
A co-op is short for a cooperative, which, according to the dictionary, means "involving mutual assistance in working toward a common goal." In the context of electric co-ops, they are not-for-profit businesses owned and controlled by the people who use their services.
Electric cooperatives are owned and controlled by their member-owners, who are the customers. Each member has a say in the cooperative and can vote for the board of directors, adhering to the principle of one person, one vote. The board of directors hires and oversees a management team responsible for day-to-day operations.
A utility company maintains and operates a region's energy generation and transmission infrastructure, including power plants, solar arrays, wind farms, transformers, and transmission lines. They can be investor-owned or publicly owned. Electric co-ops, on the other hand, are owned and controlled by their members, who are the customers. Co-ops return profits to their members in the form of capital credits or reinvest them in infrastructure.
Electric cooperatives are prevalent in rural areas of the United States, serving over 40 million people, including those in persistently impoverished counties. They also exist in other countries, such as the United Kingdom (Co-operative Energy) and France (Enercoop).
Electric co-ops were created to bring electric power to rural areas that were not served by investor-owned utilities due to a lack of perceived profitability. The Rural Electrification Act of 1935, part of Franklin D. Roosevelt's New Deal, played a significant role in establishing electric cooperatives in the United States.
