"Celebrating Electric Cooperatives”
Electricity is one of the most important elements in our lives—providing lights for our houses, businesses, schools, public facilities, streets and roads. Electricity powers industries, institutional facilities, radios, televisions and computers. Our communities across Texas are linked and blessed as together they share the energy sources provided by both private for-profit and public not-for-profit entities furnishing electricity.
For many years October has been recognized as National Cooperative Month to celebrate and express appreciation for the vast cooperative networks stretching across the United States. One out of every three Americans belong to some kind of cooperative. The nation has over 2,106 agriculture co-ops with more than 2 million member-owners. Consumer cooperatives have a membership base of over 343 million. More than 1.2 million families live in cooperative housing. All of these various cooperatives are celebrated this month. There are over 900 electric cooperatives serving millions of Americans This month also provides information for the public on the work of electrical not-for-profit cooperatives in the nation.
Before the 1930s rural areas and even relatively isolated suburban communities were not served with electricity. Investor-owned utilities did not extend their services beyond the cities and larger towns because the expense of infrastructure and services were not profitable. In 1936 the Rural Electrification Administration (R.E.A.) came into existence as a federal program to assist not-for-profit cooperatives to finance electric systems for rural and small communities across the nation. The R.E.A. was originally created by executive order in 19365, later becoming an authorized federal agency by act of Congress (Rural Electrification Act of 1936) under the United States Department of Agriculture. These electric cooperatives focused on rural communities and were inseparably linked to them.
The National Rural Electric Cooperative Association (NRECA) created in 1940 embraces over 900 electric cooperatives emphasizing the intimate linkage of these co-ops and their communities. Indeed, one of the essential reasons the co-ops are valued is their link to the local communities they serve. The NRECA actually states, “Community is the core co-op advantage that connects with consumers.” Texas’ 67 electric distribution co-ops were created in the 1930s to serve rural and suburban areas with electricity. These rural electric co-ops are owned by the members in their service area who pay for their electricity and services. They are overseen by a board of directors in each individual co-operative elected annually. There is an administrative body that maintained the records, oversees the management, upkeep, repairs and expansion of services. Each member-owner has a vote during the annual meeting governing the operation of the co-op and the election of the governing board. This is an essential element in the community-oriented rural electric cooperative system.
Electric cooperatives serve areas in 47 of the 50 states with a vast network of service installations, lines and distribution centers. The cooperative-owned electric lines cover 42 percent of our nation’s land mass and serve millions of people, farms, businesses, institutions and facilities. Each of these not-for-profit entities are autonomous, independent-owned by members served with member-elected board of directors. The board approves policies, procedures and resolutions that guide the way these member-owned entities operate.
These not-for-profit electric cooperatives are guided by Seven Cooperative Principles recognized by all their associates across the nation. These principles are another expression of community stewardship and service-mindedness.
PRINCIPLE NO. 1 – Voluntary and Open Membership. “Cooperatives are voluntary organizations open to all persons able to use their services and willing to accept responsibilities of membership, without gender, social, racial, political or religious discrimination.”
PRINCIPLE NO. 2 – Democratic Member Control. “Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote), and cooperatives at other levels are organized in a democratic manner.”
PRINCIPLE NO. 3 – Members’ Economic Participation. “Because members own their electric cooperatives, co-ops do not create profits for distant shareholders. Instead, any excess revenue—called “margins”—is allocated back to the membership in the form of capital credits, or patronage capital. The co-op uses these allocated funds as working capital until the board of directors determined that returning the funds to members make financial sense. When capital credits are retired, members are paid based on how much electricity they purchased from the co-op for a given year.” One co-op general manager has written, “Allocating and retiring excess revenue to members distinguishes cooperatives. We’re proud to support our communities by putting money back into the local economy—and into the wallets of those we serve.”
PRINCIPLE NO. 4 – Autonomy and Independence. “Each cooperative is an autonomous, independent business.” They work with neighboring co-ops, but they are governed by their member-elected board of directors.
PRINCIPLE NO. 5 – Education, Training and Information. “Cooperatives have a charge to keep their members informed—not just about cooperative business but also about topics like energy efficiency, safety and community contributions.” In Texas the cooperatives share information and related items through the monthly publication Texas Co-op Power that specifically seeks to educate, inform and entertain the member-owners.
PRINCIPLE NO. 6 –Cooperation Among Cooperatives. “Cooperatives serve their members most effectively and strengthen the cooperative movement by working together through local, national, regional and international structures.” Each co-op is independent, but they work together to share resources, information, and in some cases, even manpower to accomplished shared goals and objectives. When there are natural disasters co-ops work together to get power restored for fellow cooperative members.
PRINCIPLE NO. 7 – Concern for Community. “While focusing on member needs, cooperatives work for the sustainable development of their communities through policies accepted by their members.” Co-ops are good stewards of their resources and of the communities they serve. They undertake a variety of projects, initiatives and charities that benefit schools, organizations, volunteers and businesses in their areas.
If you have ideas or insights into the value of cooperative efforts and initiatives I would appreciate you sharing that with me. I would like to hear from you and will appreciate you sharing your thoughts with me. You may contact me by email firstname.lastname@example.org . I can also be reached by “snail mail” at Dr. Jerry Hopkins, P. O. Box 1363, Marshall, Texas 75671. Dr. Jerry Hopkins is a historian and retired university professor