Molly Ayala
Electric cooperatives are private, non-profit energy providers that are owned and operated by their members or customers. They are dedicated to delivering electricity to rural areas, empowering communities, and improving sustainability. Electric cooperatives are an alternative to commercial utility companies, governed by a board of directors nominated and voted on by the members. With a focus on community rather than sales objectives, electric cooperatives reinvest profits into infrastructure or distribute them to members as capital credits, reducing power costs. Electric cooperatives are leading the way in cutting carbon footprints and increasing customer satisfaction, providing reliable electricity to millions of people in rural and suburban areas across America.
| Characteristics | Values |
|---|---|
| Owned by its members | Customers become voluntary collective owners |
| Non-profit | Profits are reinvested in infrastructure or returned to members |
| Service-focused | Dedicated to providing electricity to rural areas |
| Community-focused | Work to improve the sustainability and well-being of their local and surrounding communities |
| Democratic | Members can vote in board elections, participate in policy-making, and share their ideas and concerns |
| Emission-reduction | Co-ops have reduced sulphur dioxide emissions by 82%-83%, nitrogen oxide emissions by 68%, and carbon dioxide emissions by 17%-14% from 2005 to 2021/2022 |
| Customer satisfaction | Co-ops secured seven of the top 10 spots in the 2023 J.D. Power Electric Utility Residential Customer Satisfaction Study |
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What You'll Learn
- Electric cooperatives are community-focused and work to improve sustainability
- Co-ops are democratically run, giving members a vote and a say
- They are dedicated to providing electricity to rural areas
- Profits are reinvested into infrastructure or returned to members
- Co-ops are leading the way in cutting carbon footprints
Electric cooperatives are community-focused and work to improve sustainability
Electric cooperatives are committed to improving sustainability and the well-being of their local communities. They achieve this through various initiatives, such as reinvesting revenues into infrastructure development and returning profits to members in the form of capital credits or patronage dividends. This model ensures that any financial gains are directed back into the community, supporting its long-term prosperity.
Electric cooperatives also prioritize environmental sustainability. They actively reduce emissions by adopting renewable energy sources, including wind farms and solar arrays. For example, cooperatives have almost doubled their renewable capacity since 2016, generating enough electricity to power millions of homes. This commitment to sustainability not only benefits the environment but also provides economic benefits to the community, such as new tax revenues, direct payments to landowners, and job creation in rural areas.
Furthermore, electric cooperatives are uniquely positioned to understand and meet local needs. Being built by and belonging to the communities they serve, cooperatives are led by members who share a vested interest in the area's success. This community-driven leadership ensures that decisions are made with the community's best interests at heart, fostering a sustainable and resilient future for all.
Overall, electric cooperatives are deeply committed to community development and sustainability. Through their democratic structure, reinvestment of profits, and focus on renewable energy, cooperatives empower and enhance the communities they serve, creating a brighter future for their members and the environment alike.
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Co-ops are democratically run, giving members a vote and a say
Electric cooperatives are democratically run organisations, with each customer being a member and owner of the business. This means that all members have equal individual authority and a vote in board elections. Members are also encouraged to voice their thoughts and ideas within the company, and to participate in policymaking.
The democratic nature of electric cooperatives stems from the fact that they are member-owned and operated. This means that members have a direct say in how the cooperative is run, and can hold elected directors accountable. Electric cooperatives are built by and belong to the communities they serve, and are therefore uniquely suited to meet local needs.
The benefits of democratic participation in electric cooperatives are twofold. Firstly, it allows members to have a direct say in the decisions that affect their energy supply and, secondly, it ensures that the cooperative is run in the best interests of the community. This is in contrast to investor-owned utilities, where the extent of individual authority is governed by the number of shares held, and decisions are made based on financial returns for shareholders rather than the needs of the community.
The democratic process in electric cooperatives also fosters a sense of community and collective ownership. Members work together for the good of the community, and the cooperative functions as a nonprofit, reinvesting revenue into the community through stable rates, infrastructure development, or returning it to members through patronage capital or capital credits. This model of democratic participation and community focus has proven successful, with electric cooperatives securing seven of the top 10 spots in the 2023 J.D. Power Electric Utility Residential Customer Satisfaction Study.
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$39
They are dedicated to providing electricity to rural areas
Electric cooperatives are dedicated to providing electricity to rural areas, filling a gap left by commercial utility companies that are hesitant to build power lines in these regions. As of early 2024, cooperatives serve 42 million people, including 92% of persistent poverty counties, powering over 22 million businesses, homes, schools, and farms in 48 states.
The history of electric cooperatives in the United States is tied to the Rural Electrification Administration (REA), established in 1935 by President Roosevelt to provide federal assistance for rural electrification. At the time, nine out of 10 rural homes lacked electric service, and power companies largely ignored these areas, believing that the sparse population would not provide sufficient revenue to justify the investment.
However, farmer-based cooperatives stepped up and applied for loans from the REA to build power lines and provide electricity to rural communities on a not-for-profit basis. This initiative brought light to rural places, transforming their economies and livelihoods. Today, about 99% of the nation's farms have electric service, thanks to the efforts of these cooperatives.
Electric cooperatives are built by and belong to the communities they serve, and they are led by members from these communities. This community-focused structure ensures that cooperatives are uniquely positioned to understand and meet local needs. Cooperatives follow democratic processes, allowing members to vote in board elections, participate in policymaking, and share their ideas and concerns.
By choosing a cooperative electric company, you support an organization dedicated to providing electricity to rural areas, empowering communities, and improving their sustainability and well-being.
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Profits are reinvested into infrastructure or returned to members
Electric cooperatives are private, nonprofit organisations owned and operated by their members or customers. Unlike commercial utility companies, electric cooperatives are service-focused and reinvest profits into infrastructure or return them to their members.
Electric cooperatives were created to bring power to rural areas that were not served by commercial utility companies due to a lack of profitability. Today, electric cooperatives continue to serve these areas, as well as booming suburbs, and play a vital role in transforming communities. They are dedicated to providing reliable and affordable electricity to their members, and they have proven to be very cost-effective.
As of 2024, electric cooperatives serve 42 million people, including 92% of persistent poverty counties, and power over 22 million businesses, homes, schools, and farms in 48 states. They return more than $1 billion to their consumer members annually as not-for-profit organisations. Electric cooperatives are led by members from the community and are well-suited to meet local needs.
Electric cooperatives are governed by a board of directors who are nominated by the members and voted on annually. Each member has equal status and influence, and they can participate in policymaking and share their ideas and concerns. This democratic process ensures that the cooperative is run in the best interest of the community.
By reinvesting profits into infrastructure or returning them to members, electric cooperatives prioritise their members' needs and work towards the sustainable development of their communities.
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Co-ops are leading the way in cutting carbon footprints
Electric cooperatives are dedicated to providing electricity to rural areas, unlike commercial utility companies, which focus on in-town homes and businesses due to higher profit margins. Electric cooperatives are community-focused and aim to improve the sustainability and well-being of their local and surrounding areas.
Co-ops are also investing in clean energy technologies, including solar, hydroelectric, and battery storage. For example, the Roanoke Electric Co-op in North Carolina is committed to achieving net-zero carbon emissions by 2050, with a 50% reduction target by 2030. They offer innovative programs, such as web-based "smart technology," to help members manage their electricity usage and reduce their environmental impact.
Food co-ops are also actively addressing climate change. The City Market/Onion River Co-op in Burlington, Vermont, has significantly reduced the impact of refrigerants in their stores by utilizing state-of-the-art refrigeration units that employ carbon dioxide as a refrigerant, which is far less harmful to the environment. The Community Food Co-op in Bellingham, Washington, uses solar panels and renewable energy credits to supply all of their energy needs and even contribute a surplus back to the grid for their community.
Co-ops have a global presence and a significant collective impact. With their commitment to clean energy solutions and community-focused approach, co-ops are making substantial progress in the fight against climate change.
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Frequently asked questions
An electric cooperative is a private, nonprofit company owned and operated by its members or customers. Its main purpose is to deliver electricity to its members living in its service area.
Electric cooperatives are built by and belong to the communities they serve. They are led by members from the community and are focused on meeting local needs. Each customer is a member and owner of the business and has an equal say in the company.
Electric cooperatives are dedicated to providing electricity to rural areas that commercial utility companies often ignore. They are community-focused and work to improve the sustainability and well-being of their local communities. They are also leading the way in cutting carbon footprints and adopting clean energy solutions.
Joining a local electric cooperative is usually as simple as connecting to its grid and signing up for electric service.
