ENERGY COOPERATIVE
ASSOCIATION OF PENNSYLVANIA
Exploring Cooperatives: Economic Democracy and
Community Development in Pennsylvania and Wisconsin
June 13, 2012
The Energy Co-op Mission
• To provide energy cost savings, education and
advocacy on behalf of its members
• To promote the efficient use of energy and the
use of renewable energy
• To support cooperative concepts and participate
in the cooperative movement
ECAP History & Programs
History
• Est. 1979 as a heating oil
cooperative
• Founded by Weavers Way Food
Cooperative members
• Located in Center City
Philadelphia
• Serves members in a five county
region of Southeast PA
Programs
• Heating Oil
• Electricity
• Biodiesel Distribution
Service Area – Delaware Valley Region
Heating Oil Program
• Group buying program for heating oil consumers
• Owner-members in five counties
• Partners with 10 suppliers
• Most locally owned
• 5 provide Bioheat/combinations of bioheat and conventional heating oil
• Floating daily rate – varies by supplier
• Set by ECAP
• Based on the daily wholesale market price and marked up for each supplier based
on contracted fixed margins
• Average cost savings of up to
$.20/gallon
Energy Program
• Electricity Generation Customer Choice and Competition
Act of 1996
• ECAP licensed Electric Generation Supplier
• 2012 Electricity Composition
• EcoChoice100 = 99% wind; 1% solar
• EcoChoice20 = 20% wind
Biodiesel Distribution Program
• ECAP is a a full-service, licensed Class I
Distributor in Pennsylvania supplying biodiesel at
any blend level
• Sustainably sourced, produced and distributed
• Grant application and administration support
• Quality ASTM-grade fuel
Categorizing ECAP
• Type – determined by ownership
structure and function
• Consumption OR production
• ECAP incorporates elements of
both
• Sector – industry in which
the cooperative operates
• Utility sector
• Distribution OR generation
and transmission (G&T)
• Federated co-ops form
purchasing co-ops to
generate or purchase the
power they distribute
ECAP = Hybrid Consumer-Producer Federated
Energy Distribution-G&T Cooperative
ECAP Organizational Structure
Members
(7,606)
Board of Directors
(10)
Staff
(7)
Board of Directors
• Elected by and (largely) from within ECAP’s membership
• Administrative and managing agent of the cooperative
• Composition (according to bylaws)
• 5 – 11 directors solicited from all classes of membership
• ≥ 50% of directors need to be active members
• ≤ 6 at-large, non-member directors
• 2 year staggered terms with a 4 term limit
•
Oversees the Electricity and
Biodiesel Distribution programs (and
ultimately the Heating Oil Distribution
Program)
• Direct research and development of
existing and new energy programs
• Manage the implementation of
strategic goals
• Manage and report on the financial
conditions of the organization
.
Biodiesel
Distribution
Program
Manager
Staff
Co-Director
of
Programs
• Oversee the Membership,
Marketing, and Outreach
departments
• Manage the implementation of
strategic goals and strategic
Co-Director management process
• Oversee HR, IT and infrastructure
of
• Report on organization’s
Operations operational conditions
• Maintaining inventories of
biodiesel
• Ensuring quality control
• Arranges and processes
deliveries
• Reports on grant deliverables
Outreach
Associate
Marketing
Coordinator
Electricity
Program
Manager
• Managing and growing the
Electricity Program
• Identifying and obtaining
for local energy sources
• Engages members through
the co-op’s social media
sites
• Serves as the face of the
co-op at local events
• Coordinating all
marketing efforts
• Oversee Heating Oil
membership services
Manager of
Membership &
Administration
• Focuses on meeting the
needs of the co-op’s
growing membership base
• Manages website and IT
needs
Members
• Membership Classes
• Class A – any cooperative organization, credit union, unincorporated
association, community association or nonprofit organization
• Class B – any residential household or residential energy consumer
• Class C – any businesses or for-profit enterprise
• Membership Status
• Active – members using ECAP services/products who are current with
dues or have applied for/received a dues waiver; only active members
can vote at the AMM
• Inactive – members using ECAP services who are not current with
dues and have not requested a dues waiver
• Supporting – organizations, households and businesses unable to use
ECAP services/products due to unavailability who are eligible for
limited member benefits
7,606 members as of February, 2012
2009 Membership by Class
Class C
Class A
Class A
Class B
Class C
Class B
2012 Membership by Status
Grace
Supporting
Active
Inactive
Inactive
Supporting
Grace
Active
Member Motivation for Joining ECAP
60
50
40
To save money on energy
To receive a fair price on energy
30
To support a locally-based organization
To support a variety of renewable
electricity sources
To support in-state renewable electricity
sources
20
10
0
Reasons for Originally Joinging ECAP
Member Age Distribution
100%
90%
80%
70%
Prefer Not to Answer
60%
65 and older
55 -64
50%
45 - 54
35 - 44
40%
25 - 34
18 - 24
30%
20%
10%
0%
Member Age Distribution
Highest Level of Education Received
100%
90%
80%
70%
60%
Prefer Not to Answer
Graduate
50%
College
High School
40%
30%
20%
10%
0%
Educational Attainment
Household Income Range
30.00%
25.00%
20.00%
Less than $25,000
$25,000 - $34,999
$35,000 - $49,999
$50,000 - $74,999
15.00%
$75,000 - $99,999
$100,000 - $124,999
$125,000 - $149,000
$150,000 or more
10.00%
Prefer Not to Answer
5.00%
0.00%
Household Income Range
Member Engagement
80.00%
70.00%
Nothing. I like my current level of
engagement.
60.00%
Participate in an online forum for members.
50.00%
Attend the annual membership meeting.
Present information about The Energy Co-op
to neighbors or civil/professional associations.
40.00%
Serve on a committee.
30.00%
Volunteer at community events.
Serve on the board.
20.00%
Volunteer at the office.
10.00%
0.00%
What would make you feel more engaged as a member of The Energy
Cooperative?
ECAP & Strategic Management
• 2012 Strategic Planning Initiative
• Lack of best practices
• Unique organizational structure
• Mixed urban, suburban and rural membership/service
area
• Cooperative and ECAP-specific values
• Innovative, young and expert leadership
Big Hairy Audacious Goal (BHAG)
• By 2020, The Energy Coop
• Has 20% market share,
• Sources 100% of its renewable energy from within
the region, and
• Reduces overall greenhouse gas emissions by
more than 20% compared to conventional energy
usage.
Strategic Issues
Expansion
• Patronage rebates distributed in
proportion to use
• How to distribute patronage
rebates to new members?
• New users may receive benefits
that are disproportional to their
share of the equity investment
• Existing members may be
reluctant for the cooperative to
use the equity created through
their patronage to fund
operations benefiting new users
Diversification
• ECAP’s weak position in the
renewable energy market
• ECAP’s competitive edge
dependent on innovation and
diversification
• Investment in R&D will yield
uneven/irregular program
diversification
• Uneven diversification will result
in disproportionate patronage
rebates
Conclusions
• Importance of mission and values
• Identification of strategic issues and best practices consistent
with cooperative principles
• ECAP’s innovative products and unconventional business
structure pose specific challenges
• Profit distribution system
• Equity structure
• Realization of the BHAG requires balancing ECAP’s
• Progressive business structure
• Organizational values
• Universal cooperative principles