Rural Electric Cooperative

Image provided by New Economy Coalition

Did you know there’s a cooperative sector in the United States that counts 42 million member-owners and provides services which t cover 56 percent of the country? They are known as Rural Electric Cooperatives (RECs), of which there are over 850 distribution, generation, and transmission services, powering 20 million businesses, homes and farms in 47 states.

“These co-ops are an example of how rural communities have done entrepreneurship differently,” says Nathan Schneider, a professor of media studies at the University of Colorado, Boulder.

RECs got their start in the 1930s and ‘40s, primarily because the mostly private businesses that were electrifying cities found it unprofitable to extend their networks to rural regions. Farmers formed cooperatives and — with the assistance of government funding and cooperative financial institutions — were able to electrify much of rural America. Despite this history, it often comes as a surprise that RECs are so widespread. In fact, even their own member-owners are often unaware that they are members of a cooperative. Over the past decades, within many RECs, relatively few member-owners have been actively engaged, leading them to be run by for years by the same family or small group of people, or take on entirely un-democratic practices.

“There are not 42 million Americans who know what a co-op is,” says Jake Schlachter founder and executive director of WeOwnIt, a start-up nonprofit that is building a national network for all types of cooperatives and their member-owners. “There is this real need for member-owners to support each other by organizing to build power to reclaim their co-ops, or in the cases where the co-ops were never owned or controlled by members, to assert their identity as owners for the first time.”

WeOwnIt and New Economy Coalition, a network of nonprofits working for an economy where people and planet come first, have released a toolkit aimed at educating Americans and REC member-owners about RECs and their role in the economy. The toolkit includes information on the state and scope of RECs across the country, case studies, organizing materials and guides on member engagement and cooperative finance.

“The toolkit provides a curated guide — or an introductory document — that will prove useful for member-owners who are trying to find out what is going on at their co-op and what to do about it,” says Schlachter.

Greater involvement by member-owners could help RECs address modern challenges, too. RECs are legacy institutions and often rely on legacy energy–namely, fossil fuels. Many are still using centralized coal plants, which are responsible not only for dangerous pollution but also greenhouse gas emissions. This is risky for the RECs themselves, as they could be left behind and suffer financially as energy systems transition.

“The energy market has never gone through as much change as is happening right now, at a rapid pace,” says Schlachter. “Member-owners are at risk at losing their democratically owned utility if their co-op is not able to adapt to these changes in the market fast enough.”

There are some Rural Electric Cooperatives leading the charge on this front. Kit Carson REC in New Mexico is aiming to achieve 100 percent daytime solar electricity generation by 2022, and has plans to make their system more resilient by integrating battery storage. In Hawaii, the Kaua’i Island Utility Cooperative (KIUC) has grown its use of renewable energy from just eight percent in 2010 to 55 percent today, and aims to hit 70 percent by 2030, with distributed solar as the key to their growth. Puerto Rico, too, is looking at decentralized systems and energy cooperatives as it seeks to rebuild its power system in the aftermath of Hurricane Maria.

Part of the potential of WeOwnIt and the emerging network of active REC member-owners is to share lessons from model RECs like Kit Carson and KUIC and get more member-owners to take leadership roles and push for cleaner and decentralized options across the country.

“One of the things we can do [to] inspire member-owners is by holding up these examples of co-op excellence across the country,” said Schlachter. “If Kit-Carson can do 100% renewable energy… why can’t we do it here?”

The re-emergence of Rural Electric Cooperatives as a force for democratic, equitable businesses could also have an impact beyond of rural America. These entities have access to billions in finance through associated cooperative financial institutions, and linking them up with emerging cooperative incubators and start-up platform co-ops could help shift the entire economy toward cooperativism.

“Young people don’t realize that there are big, powerful, multi-billion dollar co-ops all around them, and if we don’t participate in that legacy, we can’t build upon it,” says Schneider. “Reigniting those older co-ops is a way of igniting the possibility of younger ones.”

Nithin Coca


Nithin Coca

Nithin Coca is a freelance journalist who focuses on pressing social and environment issues, particularly in developing countries.