Since 1964, October has been designated as National Cooperative Month, providing cooperatives with an opportunity to explain the cooperative difference to their members. In this month’s article, I would like to explain some of the cooperative differences and how it benefits all of us as cooperative members.
As the electric utility industry continues to evolve and face continual change, we can all be proud that we are part of the electric cooperative program. Electric cooperatives have a very unique business model that provides many benefits for its members and has proven the test of time for over 83 years. Your electric cooperative is a not-for-profit, member-owned business and exists for the sole reason of serving members. Your electric cooperative sets the rates just high enough to cover the cost of doing business unlike investor-owned utilities that strive to maximize profits for investors or shareholders. Any money that is collected by the cooperative above the cost of operations is allocated back to you as capital credits. This allocation becomes your equity ownership in the cooperative and when the financial condition of the cooperative permits, the capital credits are returned to you in the form of cash. Over the past ten years, your cooperative has paid back approximately $18.0 million in capital credits as cash to members.
Electric cooperatives are democratic organizations controlled by the members who actively participate in electing representatives, setting bylaws and making decisions. The members of a cooperative have equal voting rights – one member, one vote. Each customer of the cooperative is a member and owner of the business with an equal say as every other member, unlike investor-owned utilities where the amount of governance is determined by the number of shares held in the company.
Electric cooperatives and their employees support the local community and local economy in various ways. Commitment to community is a founding principle of electric cooperatives and as a local business, your cooperative is staffed by your friends and neighbors that work hard for you. Whether the employees are working thru storms to restore your power, volunteering their time to help install lighting on local ball fields or finding ways to help provide grants for local schools, your cooperative employees are finding ways to make a difference in your community.
In summary, your local cooperative has a very unique business model that benefits all of us as cooperative members. As the utility industry continues to evolve and explore different ways to serve its customers, all of us can be very proud to be member-owners of our electric cooperatives, what we stand for, how we operate and how we truly make a difference in our very own communities.