Energy Utility Basics:
The Cooperative Model
October 24, 2011
Brian Rude
Vice President, External Relations
Dairyland Power Cooperative
La Crosse, WI
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1930 – only 11% of farms had electricity
Depression limited development options
Growing population demanded better rural
economy
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1935 Executive Order created the Rural
Electrification Administration to fund local
electric systems
Congress formalized in 1936
Local cooperatives developed and built system
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First system in Wisconsin was Richland
Electric in 1937
By 1945, today's network of 24 Wisconsin
cooperatives in place
520,000 residents served
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930 cooperatives in 47 states
42 million people, 11% of the population
10% of kilowatt hours
43% of all power lines in country
7 customers per mile compared to 35 for IOUs
and 47 for municipals
Cooperative Model
• Owned and controlled by consumers
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served
Governed by board of directors, elected
at annual meeting
One member, one vote
Not for profit
Revenues over budget called "margins"
are returned to customers
Organization of Cooperatives
• 864 distribution cooperatives
• There are 66 generation and
transmission cooperatives (G&Ts)
serving distribution co-ops; others buy
from other sources (TVA, IOUs, etc.)
Touchstone
Energy
Branding
Wisconsin
• Six cooperatives purchase from
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other sources
18 are members of Dairyland Power
Cooperative, Wisconsin’s only G&T
MN
WI
IA
IL
Dairyland Power
Cooperative
Service Territory
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Dairyland headquartered in La Crosse
Generating facilities in Alma, Genoa, Ladysmith,
Elk Mound, and Eau Claire, Wisconsin and
Adams, Minnesota
Serve 253,000 meters representing 600,000 people
Renewables on the Dairyland System
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Wind (Iowa and Minnesota)
Landfill gas (Iowa and Wisconsin)
Manure digesters (Wisconsin)
Hydroelectric (Wisconsin)
Biomass (Wisconsin)
44 MW
15 MW
4 MW
24 MW
40 MW
Renewables on the Dairyland System (cont.)
• Small consumer-owned systems
• 231 total as of July 1, 2011
• Includes 90 wind, 140 solar and one
mini-hydro
Challenges Facing the Industry
• Greenhouse gas legislation and EPA rules
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resulting in environmental upgrades to
existing plants
Cost of fuel, transportation for coal
New renewable facilities to meet
mandates and prices of renewables
New transmission facilities for growth,
renewables