Co-op Governance

CO-OP GOVERNANCE
Talking Points | May 2016

 

Electric cooperatives are member-owned and not-for-profit.
Electric cooperatives are owned by the consumers they serve. These consumers are members of the cooperative. Co-ops provide cost-based power to their members.

Electric cooperatives are member-regulated.
Co-op members elect a board of directors who oversee the activities of the cooperative, including rates, establishing policies and procedures and approving budgets. Co-ops are further regulated by the Tennessee Valley Authority, their power supplier and an agency of the federal government.

A co-op member can seek a nomination to the board of directors.
[Provide information on your co-op’s nomination and/or petition process, including dates.]

All co-op members are encouraged to vote in the annual board election.
[Provide information on your co-op’s election, including dates.]

Tennessee co-ops are private corporations.
Co-ops are not subject to sunshine laws or open records requirements.

 

Visit from elected official

FOR IMMEDIATE RELEASE

 

[Politician name] visits [co-op name]

[CITY] – [Politician Name] met with leaders from [co-op] today in [location] to tour the co-op’s facilities and better understand how the utility operates.

[briefly describe visit]

[quote from politician]

“Electric cooperatives like [co-op] are not-for-profit and member-owned. That makes us rather unusual in the utility world,” says [co-op] [president title and name. “Each year [politician] reviews several pieces of legislation that can impact how we operate. Visits like this allow him to meet our employees and see the work that goes into providing our members with affordable and reliable power.”

“[Politician name] has always been supportive of our work at [co-op],” says [co-op leader last name]. “We know his time is valuable, and we appreciate him taking the time to visit with us.”

[co-op boilerplate]

 

#   #   #

 

Contact:

 

 

Members speak up at 2016 TECA TennCom Conference

The name was not the only change visible in this year’s TECA Marketing, Communications and Member Service Conference, now known as TennCom. A new session allowed attendees to hear from co-op members.

Four co-op members from various backgrounds and all parts of the state participated in the first “State of the Member” panel discussion. Panelists were Wendy Abbott from Sequachee Valley EC, Ashley Brown from Duck River EMC, Ryan Hysmith from Southwest Tennessee EMC and Tarren Quarrels from Tennessee Valley EC .

“It is incredibly important that we understand the needs of our members,” says Trent Scott, Vice President of Strategy for TECA and facilitator of the panel discussion. “We recognize that this was not a scientific study, but it does provide co-op employees with valuable insights into the perceptions, ideas and attitudes of co-op members.”

When asked if the panelist considered themselves customers or members, one responded “customer” and three responded “both.” “I said customer, but if you stress what it means to be a member, you feel like you are not just buying something. You feel like you are getting more for your money,” said Ryan Hysmith, a finance professor at Freed Hardeman University and member of Southwest Tennessee EMC. “I agree,” added Tarren Quarrels, a small business owner and member of Tennessee Valley EC. “I think that education on the benefits of being a member over a customer is important. Explaining that you are a partial owner helps people know that their voice is being heard.”

When asked how they paid their bills, the two older members reported paying online and the younger panelists reported paying in the office. “I have always been an old-school person, and we always paid in person. About six months ago, I did go online and pay our bill, and it is awesome,” said Wendy Abbott. “These were not the responses that I expected, but it is a good reminder that age, or any other demographic, is not an accurate way to predict member preferences,” says Scott.

When asked what source was used to generate a majority of the energy in their home, three of the four panelists responded “hydro.” “It is helpful for us to be aware of misconceptions,” says Scott. “We must not simply ask our members to take action on issues, but we must also help them understand how those issues affect them.”

The panel shared their thoughts and opinions on other topics such as energy efficiency, rates, legislative activities and broadband. Listen to audio of the entire session above.

 

Become a Co-op Voter

If you are a co-op director, every few years you ask people to vote for you. Here is a question for you – when was the last time you voted in a political election?

As member-owned electric cooperatives, voting is already in our DNA. By holding membership meetings, it’s how we maintain electric utilities which are responsive to our members needs. But voting also plays a crucial part in our representative democracy. Federal, state and local elections offer an opportunity to exercise a civic responsibility — to select the best leaders for our communities.

Yet in places all over America, especially in areas served by electric cooperatives, we aren’t exercising that right. In the 2012 national elections, voter turnout dropped overall, but the decline in rural counties was 18 percent—twice that of the nation as a whole.

And when voters miss the chance to vote, they also lose the opportunity to communicate their concerns to our leaders about the issues that matter to us, where we work, live, and raise families.

Reliable electricity, access to rural broadband and the quality of our healthcare system are just a few issues we all care about. Still, they only become priorities if enough people show elected officials that they are paying attention. Registering to vote and voting are the most effective ways to send this message.

When we go to the polls with the cooperative principle of “Concern for Community” in mind, we instantly improve our political system. It’s a system designed to produce a government “of the people, by the people and for the people.”

I’d like you to join me in a new initiative to get every eligible person registered to vote—you, me, family, friends, and co-op employees—and take the pledge to BECOME A CO-OP VOTER.

This campaign will help get out the vote and insert issues important to co-ops into the public discussion. “Co-ops Vote” will help boost voter turnout in our service areas to ensure that our voices are heard loud and clear every day, and especially on Election Day.

Visit vote.coop and take the pledge to BECOME A CO-OP VOTER to support your community and electric cooperative when casting your vote in 2016. The site will give you information on your elected officials and candidates, the voter registration process, election dates and locations, and background about eight key co-op issues we want our elected leaders to understand: rural broadband access, hiring and honoring veterans, low-income energy assistance, cybersecurity, water regulation, rural health care access, affordable and reliable energy, and renewable energy.

It’s critically important that we increase rural voter participation in National, state, and local elections. If you’re not registered to vote, you need to do so by July 5th to be able to vote in primaries and many local elections. It’s easy to do and it only takes a few minutes. You can access links to register to vote online at vote.coop

Co-ops Vote is non-partisan. It’s critically important that we increase rural voter participation in National, state, and local elections. Another good way to help on a personal level is this: If you are campaigning for re-election to your co-op board this year, take an extra moment and ask that member to go to vote.coop and take that pledge to become a co-op voter! Please help our rural voice be heard!

2016 Legislative Wrap Up

On Friday, April 22, after several hours of debates and disagreements between the House and the Senate over controversial amendments to bills, the second session of the 109th General Assembly adjourned for the year.

The final days of session often equate to the last days of school for students, and legislators begin to lose some of the normal decorum. One Representative sang a portion “Purple Rain” in honor of the passing of Prince, while another displayed a mixed martial arts belt, saying he brought it to the House chambers because he was “ready to rumble.” Finally, as legislators filed out of the Capitol after their last floor session of 2016, staff members clapped and cheered.

Nevertheless, the legislature had a productive year filled with the passage of legislation that will impact all Tennesseans. Among these include a plan to end the Hall income tax by 2022, approval of a property tax break for disabled veterans, creation of online voter registration and an increase in K-12 school funding of $223 million.

Other hotly debated topics included an attempt by the House to override Governor Haslam’s veto of the legislation making the Bible Tennessee’s official state book (failed), directing the attorney general to sue the federal government over its refugee resettlement program (passed), and defunding the University of Tennessee’s Diversity Office and using the money to pay for minority scholarships (passed).

TECA staff worked diligently this year to ensure that electric co-op interests were protected, and this session was a productive and successful one. Below is an update of the top priorities for TECA this year.

  • Ad Valorem Tax/Unclaimed Property: TECA supported an effort to delete an ad valorem tax exemption and update the unclaimed property process for electric co-ops passed unanimously in both the House (95-0) and Senate (33-0) Chambers. TECA staff is pleased with the smooth passage of this legislation and grateful to the sponsors, Representative Art Swann (R-Maryville) and Senator Ken Yager (R-Kingston), for carrying it on our behalf.
  • Drones Near Infrastructure Facilities: TECA supported a bill that creates a prohibition against using a drone to photograph or video critical infrastructure facilities, such as electric generation and transmission facilities, as well as distribution substations. The bill has passed the full Senate and House, and has been signed by the Governor.
  • Property Assessed Clean Energy Act (PACE): Allowed local governments to lend money to property owners to install distributed generation and energy efficiency improvements, with repayment of the loan being made through a special assessment against the property tax. The legislation was opposed by TECA and other organizations because it ignored the process and requirements of TVA for distributed generation and interconnection, and did not satisfactorily address safety concerns. The legislation was placed in a summer study, and TECA staff will monitor the progress of any study and keep you informed of the outcome.
  • Broadband: Three separate broadband bills were withdrawn this year due to lack of support by the House Business & Utilities Subcommittee. The Broadband Expansion Act, which would have provided electric co-ops retail authority and was supported by TECA, was the first proposal that would have recognized electric co-ops as potential broadband providers. Other failed bills included two that would have authorized municipal electric systems to expand broadband service outside of their service territory. Even though support from the committee was lacking for all three proposals TECA anticipates a compromise proposal to be introduced next year.

Throughout the summer, TECA staff will continue to monitor the progress of the studies being conducted by the Department of Economic and Community Development and the Tennessee Advisory Commission on Intergovernmental Relations, and we remain hopeful that the outcome of the studies will bring Tennessee one step closer to solving the problem of rural broadband access.

May 2016

05-2016-TTM

Reliable electricity is becoming even more reliable

Your electricity is on almost all the time. You knew that.

But you might not know how much of the time it’s on. And that the amount of time it’s on has been getting better every year.

Electricity has become so reliable that the numbers for a typical American home sound crazy. For most people, the total amount of time without power (an outage) is less than two hours a year—that means their electricity is on 99.977169 percent of the time.

“You can’t have 100 percent reliability all the time on something as large as an electric distribution system,” says Tony Thomas, principal engineer at the National Rural Electric Cooperative Association. And although U.S. electric service on-time is just a decimal point from perfect, Thomas says, “Reliability has been getting much better.”

To understand the improvements in electric utility reliability, you need to be introduced to what Thomas says are known as “the three sisters:” the acronyms SAIDI, CAIDI and SAIFI.

Those stand for different ways to measure how power outages affect consumers. Here’s what they mean:

SAIDI shows how long an average customer goes without power during a year. It stands for System Average Interruption Duration Index. It’s calculated by dividing all of a utility’s power interruptions by the number of customers that utility serves. Analysts caution against citing a national average SAIDI because of the huge differences in utilities across the country and how data is collected. But a report from the Institute for Electrical and Electronics Engineers (IEEE) puts the typical customer as being without power 115 minutes a year.

SAIDI numbers do not include extremely long or very short outages, since they could drastically skew the results among utilities and make the numbers less useful. Extremely long outages, like those caused by a major storm, can sometimes last more than a day. The short outages that are not included in SAIDI are, for example, cases like a utility circuit breaker quickly opening and closing.

SAIFI shows how often the power goes out for each customer. It stands for System Average Interruption Frequency Index. It’s calculated by dividing the number of customer interruptions by the number of customers.

CAIDI shows the average time it takes to restore power after an outage. It stands for Customer Average Interruption Duration Index. It’s calculated by dividing SAIDI by SAIFI.

All three of those reliability measures have been improving in the past few years, according to IEEE reports. The amount of time a utility customer was without electricity for the year (SAIDI) declined about 20 percent in the most recent four years of figures, from 143 minutes in 2011, to 115 minutes in 2014.

The number of outages per typical consumer in a year (SAIFI) went down from 1.16 to 1.07. And how long each of those outages lasted (CAIDI) declined from 117 minutes in 2011 to 104 minutes in 2014.

Thomas credits advances in utility technology for those improvements.

More and more mechanical electric meters are being replaced with automated smart meters that do more than just measure the bulk use of electricity coming to the meter at your house. They can also monitor whether electricity is delivered to your house at all, as well as the voltage quality of that electricity.

“With automated meters, utilities can know a consumer is out of power before the consumer knows it,” Thomas says.

Another step toward utilities spotting and solving outages faster is the more widespread adoption of high-tech monitoring systems. These SCADA systems (it stands for Supervisory Control and Data Acquisition) are typically set up as several computer monitors in a control room, each showing a different view of the utility’s service area, including weather maps and detailed schematics of each power line, substation and home or business served.

“Prices have dropped for SCADA systems, just like for all software in the last few years,” Thomas says. “Utility technology has gotten a lot better in the last 10 years.”

Thomas credits electric cooperatives with making special use of technology to overcome the barriers of long distances between consumer-members. Outages and other routine changes in power flow can be more quickly and easily addressed remotely, without having to make a long drive to a home or substation.

“Rural electric co-ops have done an amazing job of adopting technology and putting it to use,” Thomas says. “And all this technology just translates into better operation of the electric system.”

Rise of Reliability

Rise of Reliability

Paul Wesslund writes on cooperative issues for the National Rural Electric Cooperative Association, the Arlington, Va.-based service arm of the nations 900-plus consumer-owned, not-for-profit electric cooperatives.

Electric co-ops and a culture of safety

There is a children’s book titled Safety 1st, Safety Always. As you can imagine, it encompasses many of the traditional safety lessons parents should teach their children. We drill youngsters about safety from an early age because we know how important it is to protect ourselves and those we care about. In the spirit of May being National Electrical Safety Month, let’s take a look at how electric cooperatives have been stepping up to the plate when it comes to safety at the co-op.

Up until 2007, there was an alarming national trend among electric co-ops, which was the fact that the number of “lost time” accidents was increasing. Lost time is defined as anything resulting in an employee missing time at work; these accidents could range from a sprained ankle to the ultimate tragedy of a fatality.

This is why Federated Rural Electric Insurance Exchange, which insures the vast majority of electric co-ops nationwide, initiated a campaign called a “Culture of Safety.” It was designed to create a much greater awareness about safety issues at all electric co-ops.

Through the use of strategy labs across the country, Federated brought together co-op CEOs and general managers, operations supervisors, safety directors and linemen to better understand how each group viewed safety. In doing so, differences in perceptions regarding safety within cooperatives were identified, allowing for much needed conversations and evaluations of how to raise awareness and improve local safety cultures. The “Speak Up, Listen Up program is designed to empower anyone who sees a potentially unsafe situation to Speak Up and encourages everyone to Listen Up to their concerns. The results have been dramatic, with more than a 30 percent decline in the number of accidents over the past nine years.

As a member, you too have a role. If you see any potential dangerous situations or practices, you should report them as soon as possible to your local electric cooperative.

The implementation and success of the Culture of Safety program demonstrates a very important point. If we are intentional about our actions, we can indeed change the culture in our organizations. The same is true for our families, our teams and any groups we may belong to.

We also know that living our cooperative principles and values is equally important. We have the best business model because it puts you, the member-owner, at the center of our efforts.

We look forward to being your safe electricity provider and energy advisor long into the future. For more information about electric safety, visit everydaysafe.org.

Adam Schwartz is the founder of The Cooperative Way a consulting firm that helps co-ops succeed. He is an author, speaker and member-owner of the CDS Consulting Co-op. You can follow him on Twitter @adamcooperative or email him at aschwartz@thecooperativeway.coop

Energy savings beyond belief

Avoid Energy Scams

Avoid Energy Scams

A quick search of the Internet reveals many great ways to save energy around your home. Simple things, such as adding insulation or using energy efficient light bulbs, are simple and relatively inexpensive ways to save small amounts of energy. The same search will also reveal “amazing” products that claim to cut up to a third of your energy bill – without you changing anything about your energy use habits. Claims like this sound too good to be true, and there is good reason for that. These claims almost always turn out to be exaggerations or downright lies.

An energy efficiency scam is generally easy for a person who works at an electric co-op to spot and identify. However, it isn’t so easy for most people. Scams generally center around misstatements of science or confusion over utility programs.

A popular scam is a little box that promises to save you energy. The box is a device that supposedly saves energy without the consumer making any changes to behavior, turning anything off or adjusting the thermostat. The people who sell these boxes often claim outrageous energy savings—sometimes as much as 30 percent or more. They often use terms, such as power conditioning, capacitors and power factor, all of which are legitimate industry terms.

The sales pitch usually goes something like this: The device being sold will control alternating current, power factor and reduce the cost of electric bills. It will condition your power and make appliances last longer. The device uses no power and has no moving parts. It will make the motors in your home run better. The sales material often claims that the utility doesn’t want you to know about the device. That last part is actually true – because it is a rip off. Variations of the product have been sold to both residential and commercial customers.

There are several questions that you should ask a salesman (or yourself!) when reading an ad for the next magical cure-all:

  1. Does it violate the laws of science? Some products claim that they are capable of “changing the molecular structure … to release never-before tapped power.” Changing the laws of science is no easy task. If the inventors truly can do this, the product will surely be sold at every store in the nation, and they will become very wealthy. They won’t be mailing out flyers or operating from a poorly designed web site.
  2. Was the product tested by an independent group like a national lab or university? If the performance of the product was not tested and certified by a lab or other entity not connected to the company selling it, then be skeptical. Call the third party group and talk to them. Sometimes scammers lie about the tests.
  3. Is it too good to be true? In today’s economic times, saving money is top of mind. We want something to be true so that we can save money, improve our lives and feed our families. But wanting something to work doesn’t mean it will.

Sometimes energy scammers contact consumers directly, either by calling or stopping by and claiming they represent the local electric co-op. Never give anyone personal or financial information who claims to be an employee of the co-op without confirming their identity. If they call, ask for a call back number, then verify their identity with your co-op. If they stop by, ask the person for a valid employee ID.

The key is to be skeptical and ask questions. Asking tough questions and being skeptical will not offend honest people. Remember, if it sounds too good to be true, it probably is.

Brian Sloboda is a technical research analyst specializing in energy efficiency and renewable energy for the Business Technology Strategies (BTS), a service of the Arlington, Va.-based National Rural Electric Cooperative Association.

Meriwether Lewis EC Helps DCDL Media Expand Services

DCDL Media of Waverly is getting a little help from their friends at Meriwether Lewis Electric Cooperative in the form of a zero-interest loan to grow their services for Humphreys County. The loan is made possible by MLEC’s Revolving Loan Fund (RLF).

Owned by Connie and Dean Duke, DCDL Media has been serving the area for several years. MLEC loan funds will be used to complete a project several years in the making to help insure quality emergency broadcasting for the citizens of Humphreys County using WQMV AM1060. With MLEC’s help, DCDL will purchase the FM license and equipment needed to communicate important news and safety information to area residents during emergency situations.

As the loan is paid back over ten years, MLEC can loan it out again for other economic and community development projects. The RLF was established in 1996 with co-op funds and a grant from Rural Utilities Service. Since its inception, the RLF has awarded almost $846,000 in the MLEC service area and is in support of the cooperative’s goal to help local communities grow.

Meriwether Lewis Electric Cooperative, your trusted source for safe, low-cost, reliable electricity, is non-profit and member owned, serving over 33,500 meters in Hickman, Houston, Humphreys, Lewis and Perry counties. Visit www.mlec.com to learn more.