Riverland Energy Cooperative Brady Williams University of Wisconsin—Madison

 Riverland is a cooperative that distributes (doesn’t generate) power to rural areas of three western Wisconsin counties—Trempeleau, Buffalo and La Crosse  Approximately 14,600 members  Anyone with home or business connected to their grid is a member  Relatively new cooperative (1999), but has roots in New Deal Rural Electrification Administration of the 1930s  Is highly integrated with other cooperatives  Prioritizes quality service to members over cheap rates Overview

 Primarily distributes power from substation to home / business for rural residents of Trempeleau, Buffalo and La Crosse counties while urban residents are served by Xcel energy, a private utility  Monitors temperature, water and power for Gold n’ Plump chicken growers  Wholly-owned subsidiary Riverland Communications provides personal emergency response services, direct TV service, and wireless internet (via satellite for most remote members) Services

 In 1920s and 30s, private utilities brought power to populated areas  Rural (especially agricultural) areas were left in the dark due to lack of profitability in extending lines  REA made loans available to groups of rural people (often farmers) who wanted to found rural electric cooperatives  Met with strong opposition by investor-owned utilities  Most cooperatives founded by county; Trempeleau and Buffalo cooperatives created at this time  These two cooperatives merged in 1999 forming Riverland Energy Cooperative  Increased efficiency and better service for members History

 Each home or business that receives power from Riverland is treated as a member with the ability to exercise one vote (17,000 meters, 14,600 members)  Bigger customers get discounted rates but not more voting power  Governed by a 9-person all-member board (one from each district) which advises the general manager  Each district elects 15 members to serve on the district committee; committees then nominate potential board members  The district committees receive a special board briefing on the last year’s activity of the co-op and the future direction over the next year Structure

 Board members serve 4-year terms (limited to 4 terms)  Board elections occur 3 out of every 4 years. (3 per year, then an “off-year”)  Much less costly than yearly elections  Training of board members time-intensive and costly. Want each member to have a good understanding of the cooperative model  About 30% turnout for elections Structure

 Other than board participation and voting, relatively little member participation in daily functioning of co- op (offers very specialized service)  What features (other than 1 member, 1 vote decision making) distinguish Riverland as a co-op as opposed to an investor-owned firm? 1) Emphasis on service and member programs 2) High reliance on other cooperatives in its operations Structure

 Riverland’s American Customer Service Index rating ranked 8 points higher than the area’s private utility (100 point scale). Why might this be the case?  Good communication  Rates especially high on “friendliness”  Communication about outages affecting 25+ members  Challenge in communicating with members from non-rural backgrounds  Dedication to service technology over cheap rates  State-of-the-art software combined with flyover maps increased monitoring effectiveness  Automated GPS-driven truck monitoring system helps fix outages more quickly  Automated metering Communication, Service and Programs

 Special member programs  Co-op will pay for energy audit (but most suggestions aren’t implemented)  CHERP (Cooperative Home Energy Retrofit Project)  Cooperative effort w/ Center on Wisconsin Strategy and two other energy co-ops  Seeks to reduce financial barriers to energy-saving retrofits in rural areas  Targets people with low income, but who don’t quite qualify for government assistance  Co-op personnel will coordinate activities and administrate program Communication, Service and Programs

 CHERP  Program centered on pre and post retrofit energy audit  Energy improvements that have a positive return on investment within 10 years  On-bill financing through the cooperative such that annualized energy savings at the very least offset loan payments  Just beginning pilot phase Communication, Service and Programs

 Dairyland Electrical Industries  Owns power plant, transmission lines and substations  Is collectively owned by Riverland and ~25 other rural electricity cooperatives  Cooperative Finance Corporation  Exclusive lender for Riverland  Cooperatively owned by many electricity co-ops around the country  Importance of debt financing for electricity distributors  60% of annual construction costs are debt financed  Don’t want current customers to have to subsidize future infrastructure Integration with other Cooperatives

 ROPE (Restoration of Power in an Emergency)  Riverland shares help with neighboring electric cooperatives during times of need  Sent crews to Louisiana during Katrina  CHERP involves partnership with two other co-ops Integration with other Cooperatives

 Does it matter that Riverland is a cooperative?  YES!  Focus is clearly providing the highest level of cost- effective service to its members through open communication, efficient technology and targeted programs  High level of cooperation and integration with other cooperatives makes providing these services possible Conclusion

Special thanks to David Oelkers, General Manager, Riverland Energy Cooperative