Many U.S. regions are at elevated risk of electricity supply shortfalls in the event of extreme weather this winter, reflecting growing challenges for the power grid as substantial always-available generation is retired, the North American Electric Reliability Corp. said in a new report. 

In its Winter Reliability Assessment, released Nov. 14, NERC said all assessed areas should have adequate resources for normal peak winter load. But much of the Midwest, Mid-Atlantic and Northeast—as well as Texas—are at risk of energy shortfalls or natural gas pipeline capacity constraints if there is a prolonged cold snap. 

Those risks stem partly from growing power demand and the loss of capacity from retired coal-fired and older gas-fired plants, according to the report. 

 Challenges tied to higher demand are compounded by “flawed public policies” that are shutting down always-available power generation, NRECA CEO Jim Matheson said. 

“This growing threat to reliable electricity jeopardizes the health of local communities and undermines the American economy,” Matheson said. “This report clearly highlights the need to swiftly implement a pro-energy policy agenda with a focus on affordability and reliability for American families and businesses. Smart energy policies that keep the lights on are more important than ever.” 

Ongoing industry efforts to bolster winter reliability have made the grid better prepared for the coming months, according to NERC. 

But demand is growing from new data centers and increased electrification of home heating and transportation. Meeting that demand has become “more challenging and complex as coal-fired and older natural gas-fired generators retire and are replaced by variable and energy-limited resources,” NERC said. 

Infrastructure damage from Hurricanes Helene and Milton earlier this fall could also make the grid less resilient to extreme winter storms while recovery efforts continue, according to the report. 

Severe arctic storms have extended across much of North America in three of the past five winters. 

Areas at elevated risk of electricity supply or gas pipeline capacity shortfalls during extreme weather this winter include: 

• Midcontinent ISO: The region’s coal and gas-fired generation has fallen by more than 5 gigawatts since last winter, partially offset by a 2 GW increase in firm capacity imports. Capacity margins will be helped by a decline of more than 4 GW in forecasted peak demand since last winter. 

• New England: Dispatchable thermal generation capacity has dropped by 2.6 GW, while forecasted peak demand has grown by 0.6 GW, or 3%. 

• New York: Anticipated reserve margins are expected to be well above the installed margin, which measures how much generating capacity exceeds expected load. But operators will likely be challenged during periods of extreme cold if non-firm gas supplies are interrupted. 

• PJM Interconnection (Mid-Atlantic): No reliability issues are anticipated for PJM’s bulk power system. But some gas infrastructure facilities may have to shut down as part of legal proceedings related to a gas pipeline expansion project. As much as 20 GW of generation capacity is directly or indirectly served by the pipeline at the center of the proceedings. 

• SERC Reliability Corp.-East: Lower forecasted peak demand is slightly expanding expected reserve margins compared to 2023. However, dispatchable thermal resources have declined by nearly 1 GW, and growth in solar capacity “does little to help meet peak winter demand,” NERC said. 

• Southwest Power Pool: Anticipated reserve margins are up, largely due to increased demand-response resources. But forecasted peak demand has risen for this winter by 1.8 GW year-over-year while total generation capacity has dropped by over 4 GW. 

• Electric Reliability Council of Texas: Risk of reserve shortage remains elevated, largely due to strong load growth that exceeds gains in dispatchable resources. 

NERC recommended ways that grid operators, generation owners and government authorities can prevent energy emergencies and minimize potential power shutoffs. Those actions include preparing for high electricity demand and low wind conditions, winterizing generation units, and increasing operational coordination around generation fuels. 

Molly Christian is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson today issued the following statement on the North American Electric Reliability Corporation’s winter 2024-25 reliability assessment.

“Demand for electricity is skyrocketing across America and supply is not keeping pace. And flawed public policies that focus on shutting down always available power generation are compounding this problem,” Matheson said. “This growing threat to reliable electricity jeopardizes the health of local communities and undermines the American economy. This report clearly highlights the need to swiftly implement a pro-energy policy agenda with a focus on affordability and reliability for American families and businesses. Smart energy policies that keep the lights on are more important than ever.”

NERC is the nation’s grid watchdog. Its assessment finds that more than half the country is at risk of energy shortfalls under extreme winter conditions. It also warns, “Winter electric load is growing in most areas as the grid increasingly powers heating, transportation systems, and new data centers. Serving winter load is becoming more challenging and complex as coal-fired and older natural gas-fired generators retire and are replaced by variable and energy-limited resources.”

A previous NERC report listed energy policy as a threat to reliability. Another NERC report from last December emphasized that over the next five years, all or parts of 19 states are at high risk of rolling blackouts during normal peak demand for electricity as demand outpaces supply.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson issued the following statement on the election results.

“We congratulate President Trump on his election, and we look forward to working with him and Congress on a pro-energy agenda that protects affordability and reliability,” Matheson said. “America is at an energy crossroads and the reliability of the electric grid hangs in the balance. Critical generation resources are being retired faster than they can be reliably replaced. At the same time, electricity demand is skyrocketing as power-hungry data centers and new manufacturing facilities come online. Smart energy policies that keep the lights on are more important than ever.”

Among electric co-ops’ ongoing policy priorities:

• Safeguarding Electric Reliability. Protecting the electric grid from increasing threats to reliability, such as the Environmental Protection Agency’s Power Plant Rule.

• Reforming Federal Permitting. Modernizing and streamlining the federal permitting and siting process in a manner that eliminates excessive regulatory burdens and ensures more predictable and timely decisions from federal agencies.

• Enhancing Wildfire Protection. Passage of legislation such as the Fix Our Forests Act (H.R. 8790) that includes crucial improvements to grid hardening and wildfire mitigation procedures that will help co-ops better address wildfire hazards on utility rights-of-way.

• Protecting the Lower Snake River Dams. Preserving the Lower Snake River dams, which provide a critical source of reliable and affordable carbon-free electricity in the Pacific Northwest.

• Defending Direct Pay. Maintaining direct pay tax credits, which provide direct federal payments to electric co-ops when they deploy new energy technologies, including carbon capture, nuclear, energy storage, renewables and more.

• Maintaining New ERA Funding. Protecting funding for innovative energy projects from the U.S. Department of Agriculture’s Empowering Rural America (“New ERA”) Program.

• Promoting Infrastructure Modernization. Improving the nation’s electric infrastructure, including transmission facilities critical to maintaining a reliable electric grid.

• Deploying Rural Broadband. Delivering quality, affordable broadband to rural communities through programs such as the Broadband Equity, Access, and Deployment (BEAD) Program.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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Arkansas Electric Cooperative Corp. says it’s investing nearly $1 billion in over 1,000 megawatts of new natural gas generation to ensure cost-effective reliability and future equity for its 17 distribution member cooperatives.

AECC recently bought 100 acres outside Naples, Texas, where it will break ground in 2026 on a roughly $850 million gas plant, which will be its biggest generating facility and its first outside Arkansas.

The 900-MW, two-turbine, simple-cycle plant will be near three existing pipelines and electric transmission to facilitate its commercial startup in November 2028, said Jonathan Oliver, AECC’s chief operations officer. It will operate in the Southwest Power Pool’s wholesale electricity market.

AECC is also investing $93 million to expand its Thomas B. Fitzhugh Generating Station from 170 MW to 270 MW to help address a forecasted capacity shortage in SPP in 2025 and 2026. Construction began in September.

Adding two units at the gas plant in Ozark, Arkansas, with its existing pipelines and transmission, will make the project cost-effective and ready for commercial operation late next year, said Oliver.

“Making these investments ensures reliability for our members, and it ensures low costs for our members for the long term, not just a few months or a few years,” he said. “We are building equity for our members that will pay returns over time.”

The new units will join the Little Rock-based generation and transmission co-op’s fleet of nearly 4,300 MW of gas, coal, hydro, wind and solar resources.

The primary drivers for building new generation are the region’s “steady, normal consumer load growth” of about 1.5% to 2% each year and the planned retirement of about 1,200 MW of coal by 2030, Oliver said.

“Natural gas is an accessible, dispatchable resource we can rely on, and it gets full accreditation in SPP to meet capacity to serve the market,” he said. “Plus, gas prices are fairly stable now, offering members a least-cost reliable resource.”

AECC is also building solar to meet demand. The G&T’s 122-MW Woodruff County Solar Project began operation in early October, adjacent to the retired Carl Bailey Generation Station. The solar array’s capacity is identical to the gas plant output.

“By taking advantage of our owned interconnection at the Bailey plant, we’re maintaining a diverse portfolio of resources for members,” said Oliver.

Cathy Cash is a staff writer for NRECA.

Electric cooperatives and other rural utilities won substantial funding to better protect their systems against extreme weather, meet growing demand and lower costs for consumers under a new $2 billion round of a major Department of Energy program.

The funding will be provided through the DOE’s $10.5 billion Grid Resilience and Innovation Partnerships program, which was created through the bipartisan infrastructure law of 2021 to enhance grid flexibility while ensuring access to affordable, reliable power.

As part of the new GRIP round, NRECA and 12 electric rural utilities led by Georgia Transmission Corp. were picked to negotiate $97.9 million in funding for new and upgraded transmission infrastructure, part of rural utility efforts to strengthen grid resilience using advanced technologies. The money will support the Smart Technology for Advanced Resilient Transmission (START) project, which seeks to build, rebuild or reconductor transmission infrastructure and increase electric transfer capacity, including through use of advanced overhead conductors.

The consortium funding will support 13 transmission projects across 11 states.

“Electric cooperatives are leaders in finding innovative ways to reliably power their communities,” NRECA CEO Jim Matheson said. “This federal funding is an important tool as they work to meet tomorrow’s energy needs.”

Rural utilities getting the GRIP funds could help meet the growing need for transmission capacity amid new sources of demand and an aging grid. The U.S. must replace 200,000 miles of existing transmission lines over the next decade, according to some estimates.

“As electricity demand in the U.S. continues to increase, upgrading and building new transmission will be critical,” Matheson said. “Electric co-ops are working together to reliably meet these increased energy needs.”

In addition to Georgia Transmission Corp., other rural utilities getting the new START project awards are:

• Arizona Electric Power Cooperative Inc. (Benson, Arizona)
• Carteret Craven Electric Membership Corp. (Newport, North Carolina)
• Dairyland Power Cooperative (La Crosse, Wisconsin)
• East Kentucky Power Cooperative (Winchester, Kentucky)
• East River Electric Power Cooperative Inc. (Madison, South Dakota)
• Eastern Maine Electric Cooperative Inc. (Calais, Maine)
• Elkhorn Rural Public Power District (Battle Creek, Nebraska)
• Great River Energy (Maple Grove, Minnesota)
• Northern Rio Arriba Electric Cooperative (Chama, New Mexico)
• Ozarks Electric Cooperative Corp. (Fayetteville, Arkansas)
• Polk County Rural Public Power District (Stromsburg, Nebraska)

The new round of GRIP funding also included a variety of other co-op projects:

• Tennessee Valley Authority (Nashville, Tennessee): $250 million to support TVA and project partners, including some co-ops, on grid resilience projects across eight states.
• Hoosier Energy Rural Electric Cooperative (Bloomington, Indiana) and Southern Illinois Power Cooperative (Marion, Illinois): $116.8 million to build new transmission feeds to loop transmission to 10 substations in seven counties.
• Jones-Onslow Electric Membership Corp. (Jacksonville, North Carolina): $42.3 million for enhancements including a new step-down station, new transmission lines to provide feeds from multiple sources, and structure hardening of existing facilities.
• Rita Blanca Electric Cooperative Inc. (Dalhart, Texas): $40.7 million to construct a new 55-mile transmission line between Dalhart, Texas and the Three-Corners Substation at the Texas, Oklahoma and New Mexico border.
• Delaware County Electric Cooperative (Delhi, New York): $27.7 million for grid resilience projects to avoid outages caused by weather events and tree damage due to invasive species.
• Black Hills Electric Cooperative Inc. (Custer, South Dakota): $20.54 million for grid technology, a wildfire alert system and system operations tools to mitigate risk from high winds, extreme temperatures and wildfires in South Dakota and Nebraska.
• Randolph Electric Membership Corp. (Asheboro, North Carolina): $11.5 million to replace 24 aging circuit ties over 50 miles and install advanced predictive maintenance and fault location devices.
• Tombigbee Electric Cooperative (Hamilton, Alabama): $11.2 million to modernize its electric distribution system, including with energy storage, reconductoring and deploying a distributed energy resources management system.
• Kotzebue Electric Association (Kotzebue, Alaska): $7.5 million to improve its power plant to protect against blizzards and extreme weather.

Molly Christian is a staff writer for NRECA.

Rapid electric load growth, the loss of baseload generating assets and more extreme weather make a diverse power portfolio more crucial than ever, a generation and transmission cooperative leader told federal energy regulators.

“An ‘all of the above’ policy on resources has never been more critical to maintain reliability, predicated in large part on unprecedented challenges,” Hoosier Energy President and CEO Donna Walker said in remarks submitted to the Federal Energy Regulatory Commission as part of FERC’s annual reliability technical conference in Washington, D.C., on Oct. 16.

Walker represented NRECA on a conference panel about resource adequacy and expected load growth. She discussed the confluence of variables that utilities must navigate in the current environment, including potentially rapid load growth, plant retirements, and a shift toward variable and energy-limited resources.

The commission “would benefit from considering the cumulative impact of all of these factors when evaluating the reliability risks of today and how it can avoid exacerbating those risks,” Walker’s written testimony stated.

She said the U.S. electric grid is already struggling to keep up with existing demand while preparing for increased demand from manufacturing, data centers and vehicle electrification. At the same time, new regulations, including the Environmental Protection Agency’s power plant rule, could accelerate the retirement of always-available fossil-fuel-based generation and add more pressure on the grid.

“NRECA has been clear about the need for smart energy policy to prioritize electric reliability,” Walker said. “Resource adequacy is a critical component of maintaining reliability, and policymaking is impacting our members’ ability to reliably and affordably provide power to the 42 million Americans they serve.”

She explained that Bloomington, Indiana-based Hoosier Energy is transitioning from a mainly coal-fired baseload utility to a balanced portfolio that includes more renewable resources. The co-op is also partnering with Wolverine Power Cooperative in Cadillac, Michigan, on power purchase agreements with Holtec International that will support the restart of the Palisades nuclear plant in Michigan, a project that will deliver reliable, affordable, carbon-free power to members, Walker said.

Those resource additions will meet normal expected load growth over the next 10-20 years, but “these efforts become much more complicated when considering the vast number of moving parts within our industry,” Walker’s remarks noted.

Growth in consumer demand, she said, has typically been linear and incremental, but that dynamic has changed as large new commercial loads come online.

“Changes in customer load, especially large customer loads, have the potential to turn resource adequacy on its head,” she said. “Hoosier Energy is by no means alone among the co-ops in receiving interest from data centers, artificial intelligence and cryptocurrency companies.”

Walker outlined several steps that FERC could take to help co-ops and other generation and transmission providers address these challenges.

Those include a revamp of the way FERC measures and forecasts resource adequacy and giving priority to load-serving entities seeking to interconnect new generation to the grid.

Walker also encouraged FERC and states to work together on easing transmission constraints and allow states, self-regulating entities such as co-ops, and other relevant authorities to prioritize regional flexibility, transparency and fair cost-allocation methodologies for new projects.

“FERC should focus transmission planning and expansion on meeting the needs of [load-serving entities] and the consumers they serve,” she said.

Throughout her testimony, Walker repeatedly stressed that any solution to meet the growing demand for energy and transmission must consider the costs to consumers.

“The consumers of electric co-ops, who serve more than 90% of the persistent poverty counties in the United States, have to be able to afford that electricity,” she said during the Oct. 16 panel. “Cooperatives share an obligation to serve their members by providing safe, reliable and affordable electric service. The objective must be to strike a balance between cost and reliability.”

Molly Christian is a staff writer for NRECA.

The U.S. Supreme Court denied a request from NRECA and other parties to pause the Environmental Protection Agency’s rule regulating power plant greenhouse gas emissions while a lawsuit against the rule proceeds.

The Oct. 16 decision is disappointing for many electric cooperatives that face severe harm from the rule. NRECA and other industry challengers argue the rule violates the Clean Air Act because it relies on the use of inadequately demonstrated carbon capture and storage technology along with unrealistic compliance timelines. Legal challenges to the rule are currently on an expedited schedule before the U.S. Court of Appeals for the D.C. Circuit.

“Given today’s ruling, it is essential that the D.C. Circuit expedites their evaluation of the legality of the EPA rule, which we believe is unlawful, unrealistic and unachievable,” NRECA CEO Jim Matheson said. “Failure to do so will further jeopardize the reliability of the nation’s electric grid, which is already under threat from skyrocketing electricity demand.”

Justices Brett Kavanaugh and Neil Gorsuch issued a statement saying that legal opponents of the regulation “have shown a strong likelihood of success on the merits as to at least some of their challenges to the Environmental Protection Agency’s rule.”

They also urged the D.C. Circuit to move quickly on issuing a decision and emphasized that a stay may be more appropriate following the D.C. Circuit’s decision.

The rule requires increasingly stringent emissions controls at many power plants in the coming years.

Existing coal plants and new baseload gas units that intend to operate past 2038 must capture 90% of carbon emissions by 2032. Coal units retiring before 2039 must co-fire with natural gas at a 40% rate starting in 2030 under the rule and could only avoid adding new emissions controls if they retire before 2032.

Emissions controls will also be required for new intermediate-capacity gas plants.

The rule will force many co-ops to install costly carbon capture technology that has not been adequately demonstrated at the scale required by EPA. If they forgo that option, co-ops may be forced to build lower-capacity gas units to avoid more stringent emissions requirements as larger coal plants retire, or to add weather-dependent energy resources that may not be as reliable as traditional generation.

Those challenges will coincide with a rapid increase in power demand as transportation and other sectors of the economy electrify and load rises from data centers and artificial intelligence, straining the grid’s ability to reliably provide power.

“The EPA Power Plant Rule poses severe harm to American consumers, the U.S. economy and the nation’s electric grid,” Matheson said.

Molly Christian is a staff writer for NRECA.

SACRAMENTO, Calif.—NRECA is fighting the Biden administration’s latest action to move toward breaching the Lower Snake River dams that provide clean, carbon-free hydropower to 55 electric cooperatives in eight Western states. 

On Sept. 20, the Department of Energy announced that it would launch a study to explore how to “replace the power and services provided by the four Lower Snake River Dams” in southeast Washington. 

“It’s difficult to imagine why anyone would want to breach the four dams on the Lower Snake River—3,000 megawatts of always-available, carbon-free capacity,” NRECA CEO Jim Matheson told co-op CEOs and directors this week at NRECA’s Regions 7&9 Meeting, where the dams were a big topic of discussion. 

Matheson vowed that “NRECA will be very aggressive in advocating for the dams.” 

Louis Finkel, NRECA’s senior vice president of Government Relations, said the association has already been meeting with the transition teams of Vice President Kamala Harris and former president Donald Trump.  

NRECA wants to ensure that the next president—regardless of who wins—will come to office understanding how important the dams are to reliable, affordable power in the West, Finkel said. 

“Our passion is a reflection of your passion about this issue,” Finkel told co-op leaders at the regional meeting. 

The DOE study comes in the wake of a settlement agreement reached in late 2023 among the Biden administration, environmental groups, and tribal and state governments over the federal government’s operation of the dams, which plaintiffs said are threatening the survival of endangered salmon. The settlement supports breaching the dams and replacing them with other types of renewable energy. 

In January of this year, Matheson testified before the House Energy and Commerce Subcommittee on Energy, Climate and Grid Security, warning that efforts to breach the dams threaten the region’s power supply and would hurt farmers and economically disadvantaged rural communities.  

Although it would take an act of Congress to actually breach the dams, the settlement agreement and DOE study show that the administration’s actions are “all geared to putting forward a trajectory toward breaching the dams,” Finkel said. 

The DOE’s action comes as the Bonneville Power Administration, which provides power to co-ops from the dams, warned in its latest Pacific Northwest Loads and Resources Study that the region will experience rapidly escalating energy deficits in just three years as demand for electricity grows. 

In addition to advocacy efforts by NRECA and co-op leaders, NRECA has activated its grassroots network—Voices for Cooperative Power—to oppose breaching the dams, said Kelly Cushman, NRECA’s vice president of political programs.  

Last December, about 20,000 co-op consumer-members and employees who belong to VCP signed a petition calling on President Joe Biden to abandon any plans to breach the dams. The signatures were collected over a seven-day period and delivered to the White House. 

Erin Kelly is a staff writer for NRECA.

Four large electric grid operators are backing NRECA’s legal argument that the Environmental Protection Agency’s power plant greenhouse gas rule will drive the early closure of crucial generation sources and threaten grid reliability.

The operators voiced their concerns in a “friend of the court” brief supporting a federal lawsuit that NRECA, many states and other parties have filed against the rule. Among other things, the brief claimed that EPA did not adequately consider the grid’s overall “energy requirements” when deciding the best system of emission reduction under the rule.

The grid operators spoke out on the issue after more than a year of sustained outreach from NRECA and co-op leaders.

“The final rule unreasonably discounts that existing fossil power generators will need to decide whether to commit to installing untested technology or retire the generating unit years before the compliance deadline, given the economic cost and risk of compliance,” the Sept. 13 amicus brief states.

Premature retirements of generating units that provide critical reliability attributes “can have significant, negative consequences on reliability,” the grid operators noted.

 They asked the court to remand the final rule back to EPA, “with instructions for it to adequately consider the grid adequacy and reliability issues [we] previously raised.”

The brief was filed in the U.S. Court of Appeals for the D.C. Circuit by the Midcontinent Independent System Operator, PJM Interconnection, Southwest Power Pool and the Electric Reliability Council of Texas. Together, they maintain and enhance bulk power grid reliability in all or part of 30 states and the District of Columbia.

Their filing echoes NRECA’s concerns with the power plant rule, which EPA finalized in April. The regulation established greenhouse gas emissions standards for existing coal plants and new natural gas facilities, including requiring a 90% carbon capture rate for coal plants that operate past the start of 2039 and for new and modified baseload gas units.

The 90%  carbon capture and storage system that the rule mandates has not been adequately demonstrated and the emissions limits based on it are not achievable, according to NRECA. Furthermore, the rule’s timelines are too tight, and electric co-ops and their members will be saddled with the high cost of either deploying CCS or building extensive new renewable generation to replace lost coal and gas capacity, NRECA has said.

The rule is “based on overly ambitious and inadequately supported assumptions,” the grid operators said. “These assumptions then drive both the rate and timing of compliance, which in turn will drive the premature retirements of generation sources that will threaten the reliability of the electric grid.”

In comments before the rule was finalized, the grid operators had offered several “safety valve” options to mitigate their reliability concerns. But in its final rule, the EPA “did not address these specific recommendations, let alone explain why it did not adopt them,” the brief states.

Failing to address the rule’s consequences, along with those of other EPA power plant regulatory mandates, violates the Clean Air Act’s directive that EPA adequately consider the grid’s energy requirements, they stated.

“The grid operators have confirmed that the negative impacts of the power plant rule on the grid’s reliability that NRECA has warned EPA of are real and could have significant, harmful consequences for our nation,” NRECA Regulatory Affairs Director Dan Bosch said. “We are hopeful that the court will carefully consider the views of these operators that are responsible for ensuring the reliability of the bulk power grid in all or parts of 30 states and Washington, D.C.”

NRECA filed its lawsuit against the EPA power plant rule in May. The association has also asked the U.S. Supreme Court to stay the rule until the case is resolved, saying the regulation poses immediate harm to co-ops and the nation’s electric grid.

In addition, several lawmakers in Congress have sponsored a resolution to overturn the EPA rule.

Molly Christian is a staff writer for NRECA.

The power sector and government are best at solving industry challenges—including how to ensure a stable, reliable grid—when they work together, a top Department of Energy official told electric cooperative leaders at an NRECA gathering in Arlington, Virginia. 

Gene Rodrigues, assistant secretary for DOE’s Office of Electricity, spoke Aug. 21 at an inaugural meeting between NRECA’s Strategic Technology & Advisory Council and Member Advisory Groups (MAGs).  

The council and MAGs are made up of co-op representatives and have leads within NRECA’s Business & Technology Strategies division. The MAGs focus on areas of innovation, including distributed energy resources, cybersecurity, generation and data analytics. Representatives of the Transmission and Distribution Engineering Council also attended the meeting. 

As the power sector rapidly transforms due to emerging technologies and new demand sources, Rodrigues said four principles should anchor what DOE and co-ops do: reliability, resilience, security and affordability. 

“The thing that makes NRECA effective … is that we work together around those four things,” he said. “Those principles are what I think are really important.” 

But ensuring those attributes is increasingly difficult, according to Rodrigues. 

“Reliability and resilience are no longer things that we can forecast accurately,” he said. “And that means we have to get better in this industry about being not just adaptable, but actually being a little more able to … allow judgment to replace a regulator’s economic model for what to do and how to approve it.” 

Addressing those challenges also means collaborating across policy divides. 

“As we think about all those things that are important to fight against, let’s find a way for this industry to come back to an area of … agreement,” said Rodrigues. 

As an example, he pointed to a successful collaboration among DOE, NRECA and other stakeholders to craft final new energy efficiency standards for electric distribution transformers to provide stability to industry after DOE’s problematic initial proposal amid the ongoing supply chain crisis. 

“In a perfect world, we would address every issue that way, instead of litigating and regulating, et cetera,” the DOE official said. “We don’t live in a perfect world. So, what we have to do is try to push the balance to as much upfront collaboration around those four principles as we can and just recognize that there are always going to be things that we argue about.” 

That cross-sector cooperation will be key as the U.S. prepares for elections in November that could have a big impact on national energy policy. 

“There is so much common ground,” Rodrigues concluded. 

Molly Christian is a staff writer for NRECA.

NRECA is taking its fight to halt the Environmental Protection Agency’s mercury and air rule for power plants to the U.S. Supreme Court, maintaining that the rule will create substantial costs and reliability impacts for electric cooperatives but provide no appreciable health benefits. 

On Aug. 22, the association led a coalition of co-ops and industry groups in filing an application to stay the rule with the Supreme Court after the D.C. Circuit Court of Appeals declined a similar request earlier this month. A group of 23 states led by North Dakota separately asked the high court to halt the regulation until legal challenges against it are resolved. 

“This EPA rule is unlawful, unworkable and poses a serious threat to electric reliability,” NRECA CEO Jim Matheson said. “Absent a stay, it will force plant operators to install expensive, excessive and unjustified equipment that provides marginal benefit at their power plants or shut down. In many cases, this will push essential always-available generation off the grid, just as Americans are increasing their reliance on electricity.” 

As it did with the D.C. Circuit, NRECA told the Supreme Court that the rule will cause “substantial, irreparable, and immediate harm” to electric co-ops while having “no appreciable public health benefits.” 

The rule, released in April, ratcheted down filterable particulate matter emissions limits by 67% for all coal-fired plants and will require plants burning lignite coal to slash mercury emissions by 70% compared to EPA’s 2012 standard. EPA did so even though the agency found no residual health risks and did not identify any new cost-effective technologies that warranted tighter standards, which is unlawful under the Clean Air Act, NRECA argues. 

Plant operators must comply with the new standards by July 2027.  

In its stay request, NRECA said power plants are spending up to $1 million on testing just to assess whether they can meet the final rule’s emissions requirements while remaining commercially viable. It also noted the long lead time for upgrading emissions controls, with the electrostatic precipitator alterations needed to meet the rule’s filterable particulate matter limits taking three full years. 

“The final rule imposes an unduly short timeframe to commence lengthy and expensive control projects, or units will be forced to shut down,” NRECA told the Supreme Court. “The associated costs are unrecoverable.” 

NRECA filed its new stay request along with four generation and transmission co-ops—Associated Electric Cooperative Inc. in Missouri, Basin Electric Power Cooperative and Minnkota Power Cooperative in North Dakota, and East Kentucky Power Cooperative—as well as the Lignite Energy Council, the National Mining Association and Rainbow Energy Center. 

Minnkota estimated it could spend over $260 million to bring its Milton R. Young lignite coal-fired power plant into compliance with the EPA’s new standards, according to the new stay request.  

Molly Christian is a staff writer for NRECA.

NRECA is asking a federal appeals court to review the Environmental Protection Agency’s new rule for coal ash impoundments at inactive power plants and other sites, a regulation the association says will impose undue costs on electric cooperatives and exacerbate grid reliability challenges.

NRECA joined the Utility Solid Waste Activities Group and the American Public Power Association (APPA) in challenging the rule. The lawsuit was filed Aug. 2 in the D.C. Circuit Court of Appeals.

“EPA has exceeded its statutory authority and finalized a one-size-fits-all coal ash rule that will impose unnecessary and duplicative costs on cooperatives,” said Viktoria Seale, NRECA regulatory affairs director. “Cooperatives will be forced to reclose coal ash units that have been properly closed under state requirements, including sites where all coal ash has been removed.”

The legacy coal combustion residuals (CCR) rule creates two new categories of federally regulated CCR facilities: inactive coal ash impoundments at inactive power plants and CCR “management units,” areas of land where coal ash was received, placed or otherwise managed that had not previously been regulated by EPA as a CCR unit.

The rule came after the EPA in 2015 established federal requirements for managing coal ash at CCR ponds and landfills and required some units to close. The agency at the time reaffirmed that CCRs are not hazardous wastes and encouraged their continued beneficial use, including as an ingredient in concrete.

But the new legacy coal ash rule will apply existing regulatory requirements to already closed sites, some of which are located under active CCR landfills and existing power plant infrastructure, NRECA said in a fact sheet on the rule.

Instead of standing up a risk-based federal CCR permitting program and approving state plans, the legacy coal ash rule takes a monolithic approach that relies on broad and unclear definitions of regulated sites, NRECA said.

The regulation could also expose currently exempt beneficial uses of CCR to the rule’s stringent requirements. The EPA has “significantly underestimated” the number of CCR management units that would qualify under its vague definition, meaning compliance timeframes and costs will be greater than the agency anticipates, NRECA said.

“EPA should reconsider this flawed rule, which would cause serious disruptions at active power plants and exacerbate grid reliability challenges for co-ops and other utilities,” the NRECA document stated.

The legacy coal ash rule was one of four power plant regulations that the EPA finalized in April. NRECA is suing to overturn the EPA’s power plant greenhouse gas rule and has requested that the Supreme Court stay the regulation. NRECA also has joined several of its member cooperatives in challenging and requesting a stay of the mercury and air rule.

In addition, the Utility Water Act Group, which NRECA is a member of, joined the Southwestern Electric Power Co. in suing the EPA over the power plant wastewater rule, also known as effluent limitation guidelines (ELG) rule, and requested a stay of the regulation.

Molly Christian is a staff writer for NRECA.

Oglethorpe Power said it will invest more than $2.3 billion in two new natural gas projects to supply its 38 member cooperatives with an additional 1,400 megawatts to meet escalating demand across residential, commercial and industrial sectors.

The Tucker, Georgia-based generation cooperative plans to build a $2 billion, 1,200-MW two-unit combined cycle gas plant in Forsyth near the existing Smarr Energy Facility, a natural gas power plant the co-op operates. It’s expected to be operational in 2029.

The co-op also plans to add a 240-MW gas unit at its existing Talbot Energy Facility in Box Springs and aims to bring it online in 2028. The $360 million unit will be equipped with dual-fuel capability, allowing it to burn natural gas or a substitute fuel, enhancing Oglethorpe Power’s year-round resiliency.

Pending successful permitting, Oglethorpe Power plans to break ground on both projects in 2027.

“The electric cooperatives we serve need more energy capacity to meet their increasing demand,” Oglethorpe Power President & CEO Mike Smith said July 11 after the generation cooperative’s board approved the investment.

“These two new natural gas projects demonstrate growth in Oglethorpe Power’s generation portfolio and our focus on reliable, affordable and sustainable energy for our members.”

The new projects will create permanent, high-quality jobs, hundreds of temporary construction jobs plus boost local revenue that will support schools and the counties involved, he said.

The announcement comes on the heels of Oglethorpe Power’s purchase of a 465-MW, three-unit combustion turbine generation facility in Monroe from Mackinaw Power Holdings, an affiliate of the global investment firm The Carlyle Group Inc. The purchase represents the cooperative’s eighth acquisition of natural gas-fired generation in Georgia over the last 15 years, totaling more than 3,600 MW.

Oglethorpe Power also owns 30% of Plant Vogtle, a nuclear facility in Georgia. The final unit began generating electricity in April, and the project represents the first ground-up expansion of a U.S. advanced commercial nuclear energy station in more than 30 years.

Over the years, Oglethorpe Power has made strategic shifts in its generation portfolio and projects that its carbon emissions intensity rate will decline by 47% in 2025 compared to 2005 while at the same time anticipating a 61% increase in the energy it generates for its member cooperatives.

Cathy Cash is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson today issued the following statement on the U.S. Court of Appeals for the D.C. Circuit’s denial of NRECA’s motion to stay the Environmental Protection Agency’s power plant rule:

“EPA’s power plant rule is unlawful, unrealistic and unachievable,” Matheson said. “It undermines electric reliability and poses immediate and grave consequences for an already stressed electric grid. We are disappointed by today’s court ruling and will imminently file an appeal with the Supreme Court.”

NRECA filed suit over the power plant rule in the D.C. Circuit on May 9 and filed its motion to stay on May 13. The rule would force the premature closure of power plants that are critical to maintaining reliability, even as electricity demand surges.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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NRECA filed suit in Wyoming federal court on July 12 against the Department of the Interior, challenging a rule the association says will jeopardize electric cooperatives’ ability to operate on federally managed public lands across the West.

The lawsuit asks the court to vacate the Bureau of Land Management’s Conservation and Landscape Health Rule, which was finalized in April. A broad coalition of 11 other stakeholder industries, including agriculture groups and energy and mineral developers, joined NRECA in the legal challenge.

“This unlawful conservation rule creates further regulatory and operational hurdles for cooperatives and jeopardizes their ability to continue to affordably and reliably serve some areas,” NRECA Senior Vice President of Government Relations Louis Finkel said.

“It compounds the complex, slow, and inconsistent BLM bureaucratic processes that co-ops must navigate to operate on public lands. It curtails grid expansion and hardening projects; and delays vegetation management and maintenance activities that ensure reliability of the grid and reduce risks for adverse events like wildfire.”

NRECA members operate tens of thousands of miles of electric transmission and distribution lines across BLM-managed public lands, much of which are in rural parts of the West. To access and use those lands, co-ops must obtain rights of way from BLM. Prior to the BLM rule, these co-op activities were prioritized as a principal use of public lands.

BLM’s new rule, however, will make obtaining, operating and accessing those rights of way even more difficult as it elevates conservation as a priority use of public lands and requires all agency actions to be compatible with conservation moving forward.

That will create challenges for co-ops operating on BLM lands. The rule creates a conservation lease program that could enable nongovernmental groups and other parties to block energy projects and other development. The regulation also unlawfully expands BLM’s authority to designate large “areas of critical environmental concern,” in which cooperative operations may be prohibited or severely curtailed across vast swaths of land, the lawsuit says.

“Under the existing regulatory framework, BLM is already incapable of making timely and effective approvals for cooperative wildfire mitigation activities, regular operation and maintenance activities and more,” Finkel said. “This further jeopardizes safety and the reliability of the electric grid by severely reducing the amount of public lands available for utility use, and by restricting cooperatives’ ability to access and operate on those limited lands that are remaining.”

The other groups challenging the BLM rule alongside NRECA are the American Farm Bureau Federation, the Wyoming Farm Bureau Federation, the Natrona County Farm and Ranch Bureau, the American Exploration and Mining Association, the American Forest Resource Council, the American Petroleum Institute, the American Sheep Industry Association, the National Cattlemen’s Beef Association, the National Mining Association, the Public Lands Council and the Western Energy Alliance.

Molly Christian is a staff writer for NRECA.

NRECA has joined with four of its member cooperatives to urge a federal appeals court to halt implementation of the Environmental Protection Agency’s new mercury and air rule before it can cause “substantial, irreparable, and immediate harm” to electric co-ops.

If the rule is not paused, co-ops will suffer “exorbitant” costs to bring their power plants into compliance with standards that may later be deemed unlawful, according to a motion for a stay of the final rule that NRECA and others filed June 21 with the U.S. District Court of Appeals for the D.C. Circuit.

Co-ops would never be able to get that money back, even if the rule is later thrown out by a court amid legal challenges to the EPA’s authority, the motion says. If the court grants NRECA’s request for a stay, the rule would be put on hold until the courts can evaluate its legality.

It’s also questionable whether the new standards are even achievable, according to NRECA and other petitioners. NRECA has urged the EPA to rescind the new mercury rule—which has “no appreciable public health benefits”—and keep the previous standards in place.

The new rule requires plants burning lignite coal to slash their mercury emissions by 70% compared to EPA’s 2012 standard. The chemical differences in lignite prevent emissions controls from achieving the same level of reductions as in other types of coal, NRECA says.

The rule—which plant operators must comply with by July 2027—also requires a 67% cut in filterable particulate matter for all coal-fired plants but does not identify any new cost-effective technologies to meet that goal.

If the standards can’t be met, power plants would be forced to shut down, which NRECA warns would threaten reliability at a time when demand for electricity is growing.

“The premature shutdown of plants will cause electricity costs to skyrocket,” the stay request warns. “Without generation, utilities must purchase power at unsustainable prices to meet demand.”

For example, Mac McLennan, president and CEO of Minnkota Power Cooperative in Grand Forks, North Dakota, estimated in court documents that if its Milton R. Young power plant was forced to prematurely retire, it could cost his generation and transmission co-op $236 million for just four days of replacement power.

In addition to Minnkota, the G&Ts that joined with NRECA in requesting the stay were East Kentucky Power Cooperative in Winchester, Associated Electric Cooperative in Springfield, Missouri, and Basin Electric Power Cooperative in Bismarck, North Dakota.

In a declaration attached to NRECA’s request for a stay, Jerry Purvis, EKPC’s vice president of environmental affairs, said that even if the co-op spent millions of dollars on plant upgrades, it still might not be able to meet the rule’s mandates.

The mercury and air rule was released in April alongside EPA’s final power plant rule for existing coal-fired power plants and new natural gas-fired plants. NRECA believes the two rules, along with other recent EPA final rules, would exacerbate reliability threats to the electric grid as U.S. power demand surges in the coming years.

Erin Kelly and Molly Christian are staff writers for NRECA.

An expected surge in U.S. power demand from AI, data centers and other sources will be an “engine of growth” for electricity providers but also pose major reliability risks, two electric cooperative leaders warned at a recent event on supply threats to the grid.

Northern Virginia is home to many data centers that are having a “huge impact” on power consumption, Northern Virginia Electric Cooperative President and CEO David Schleicher said during a June 5 virtual briefing on “The Deepening Electricity Supply Crisis” hosted by the U.S. Energy Association.

About six years ago, Manassas-based NOVEC was a 1,000-megawatt distribution co-op, but its capacity has since doubled and is on the way to reaching around 8,000 MW.

“It’s our engine of growth,” Schleicher explained.

But that expansion comes with big challenges. Schleicher noted that data centers can be built in 18 months—well ahead of the four-year or longer lead times for some new substation equipment.

NOVEC gets its power from the PJM Interconnection, which relies heavily on the region’s natural gas and coal plants. But state and federal policies are pushing a shift toward carbon-free resources.

“[We’re] seeing an awful lot of renewable [energy] coming in with solar and offshore wind, which is going to be an integration challenge without new baseload generation,” Schleicher warned.

Rayburn Electric Cooperative faces similar challenges.

The Rockwall, Texas-based generation and transmission co-op is experiencing organic annual demand growth of 10%, and an influx of data centers is forcing them to plan for “doubling or even tripling our size,” Rayburn President and CEO David A. Naylor said at the briefing.

For Rayburn, all options are on the table for increasing supply, but when “you look at what’s available to meet those needs … you’re driven by the current technology,” Naylor said.

The co-op went so far as to purchase a natural gas-fired plant last year, but “we need more resources to meet our current needs, let alone… these additional data centers and [other demand sources],” he said.

In 2023, the North American Electric Reliability Corp. projected “material growth” in electricity demand in its long-term reliability assessment—a change from prior forecasts for flat to modest increases, NERC President and CEO Jim Robb said at the USEA event.

At the same time, the loss of many coal plants could rob the grid not only of power but other services such as spinning reserves, frequency response and voltage support, Robb said.

“As we pull any of these individual plants out, we’ve got to be mindful that we’ve got to replace not just the energy … but also the reliability benefits that they provide to the grid,” he said. “And that’s why we get concerned about the loss of traditional generation.”

Molly Christian is a staff writer for NRECA.

Lawmakers in the House and Senate introduced a resolution Wednesday to overturn the Environmental Protection Agency’s recently finalized power plant rule. 

Sen. Shelley Moore Capito, R-W.Va., and Rep. Troy Balderson, R-Ohio, introduced resolutions of disapproval against the rule in their respective chambers using the Congressional Review Act, which gives lawmakers the ability to legislatively undo a federal agency’s final rule. 

 The EPA rule seeks to aggressively limit greenhouse gas emissions from existing coal and new natural gas power plants. It mandates inadequately demonstrated technology and unachievable emissions limits, NRECA and co-op leaders say, jeopardizing affordable, reliable electricity by forcing premature plant closures while making it harder to permit, site and build critical new power plants. 

“EPA’s power plant rule is unlawful, unreasonable and unachievable,” said NRECA CEO Jim Matheson. “Under the rule, EPA illegally attempts to transform the U.S. energy economy by forcing a shift in electricity generation to the agency’s favored sources.  

“EPA exceeded its authority and Congress must overturn its action. We urge Congress to pass this resolution and are grateful for Sen. Capito and Rep. Balderson’s leadership to reverse this harmful rule.” 

To derail the rule, both the House and Senate would have to pass the resolution of disapproval. If that happens, it would then go to President Joe Biden, who would likely veto it. Two-thirds of the lawmakers in each chamber would have to vote to override a veto. The first vote on the resolution is expected in the next few weeks. 

“With this Congressional Review Act resolution of disapproval, every member of Congress will have the opportunity to protect America’s energy future, heed the warnings of our nation’s electric grid operators, and adhere to the precedent set by the Supreme Court,” said Capito, the senior Republican on the Senate Environment and Public Works Committee, in a June 5 statement. 

Balderson said the rule will have “a catastrophic impact” on power generation. 

“Slashing our baseload energy production while power demand continues to climb at historic levels is shortsighted and will have a catastrophic impact for Ohioans,” Balderson said. “This Congressional Review Act resolution allows Congress to step in and reverse the Biden administration’s efforts to practically eliminate all fossil fuel power generation by 2032.”  

Erin Kelly is a staff writer for NRECA.

As Congress considers a sweeping water infrastructure bill, NRECA CEO Jim Matheson is urging lawmakers to protect the Lower Snake River dams that provide clean hydropower to 55 electric cooperatives in eight Western states.

Matheson, in a letter to the chairman and ranking member of the House Transportation and Infrastructure Committee, asked them to stop implementation of the Columbia Basin Restoration Initiative as they prepare to take up the biennial Water Resources Development Act.

The initiative grew out of a controversial legal settlement reached by the Biden administration, environmental groups, and tribal and state governments over the federal government’s operation of the Lower Snake River dams in southeast Washington. Those four dams supply hydropower to utilities served by the federal Bonneville Power Administration.

The settlement “poses a grave threat to the operations of the Lower Snake River Dams, will ultimately result in the breaching of the dams, and threatens electric reliability for the entire region,” Matheson wrote.

In a lawsuit filed in 2021, plaintiffs charged that the dams are threatening the survival of endangered salmon. The settlement supports breaching the dams and replacing them with other types of renewable energy.

Although it would take an act of Congress to physically breach the dams, the settlement agreement undermines their operation by mandating spill and flow requirements that weaken their economic viability, Matheson said in testimony before Congress in January.

Nationally, more than 600 electric co-ops in 34 states purchase over 10 gigawatts of hydropower at cost from the federal Power Marketing Administrations’ hydropower facilities, Matheson wrote in his May 20 letter.

“Because the [U.S. Army Corps of Engineers] is the largest generator of hydropower in the United States, NRECA members have a strong interest in ensuring that the provisions included in WRDA bolster the value of the power resource that the Corps makes available to the PMAs,” he wrote.

Matheson also asked House leaders to consider other co-op priorities, including preserving rate-making authority for the PMAs to ensure that federal power customers don’t get stuck paying a disproportionate sum for Corps infrastructure projects that are miscategorized as hydropower improvements.

“Electric cooperatives enjoy a productive partnership with the federal government and the communities we serve,” Matheson told Transportation and Infrastructure Chairman Sam Graves, R-Mo., and Rep. Rick Larsen of Washington, the panel’s senior Democrat. “We appreciate your consideration of these priorities and look forward to working with you on policies that support rural America.”

Erin Kelly is a staff writer for NRECA.

The Environmental Protection Agency finalized a major new rule late last month that aims to aggressively cut carbon dioxide emissions from power plants. 

NRECA CEO Jim Matheson immediately responded, calling the rule “unlawful, unrealistic and unachievable,” and critics across the industry have decried the sweeping, 1,000-page regulation as a misguided threat to electric reliability at a time when the grid is already stressed and facing soaring demand amid a rise in new manufacturing, electric vehicles and data centers.

Hear from Ashley Slater, NRECA’s vice president for regulatory affairs, and Mac McLennan, CEO of Minnkota Power Cooperative in North Dakota, about the rule, its impacts and how co-ops are working to reverse it.

Listen to the episode below:

You can also listen and subscribe to Along Those Lines on your preferred podcast service:
Apple Podcasts | Google Podcasts | Stitcher | Spotify | YouTube

Find out more about NRECA’s podcast. Questions or suggestions? Email us at AlongThoseLines@nreca.coop.

Extreme heat could threaten the nation’s energy supply this summer, driving up demand for electricity and potentially causing shortfalls and power outages throughout large swaths of the United States, the North American Electric Reliability Corp. warned in a new report.

The states and regions most at risk are Texas, California, the Southwest, New England and much of the Midwest, according to NERC’s 2024 Summer Reliability Assessment released Wednesday.

The warnings underscore the danger of the Environmental Protection Agency’s recently finalized power plant rule, which threatens reliability by forcing the premature closure of power plants at a time when demand for electricity is rising, said NRECA CEO Jim Matheson.

“This latest report highlights the importance of always-available energy as our nation works to keep the lights on,” Matheson said. “That’s particularly true as we look towards a future that depends on electricity to power more of the economy. Importantly, this report does not consider the impact of EPA’s power plant rule, which will significantly undermine reliable electricity across the nation.”

Mark Olson, NERC’s manager of reliability assessments, also emphasized that the increased electrification of key sectors of the economy is quickly boosting demand and taxing the grid.

“Demand is growing in many areas at a rapid pace with the adoption of electric vehicles and construction of new data centers, straining some parts of the system,” Olson said.

The NERC report says that “weather services are expecting above-average summer temperatures across much of North America, potentially creating challenging summer grid conditions.”

Most areas are forecasting higher peak demand for electricity than last summer, the report says.

“Above-average seasonal temperatures can contribute to high peak demand as well as an increase in forced outages for generation and some bulk power system equipment.”

NERC found that the delayed retirements of fossil fuel-powered plants coupled with limited new supply “have improved the outlook for 2024” compared to some earlier reports. However, NERC also found that “a growing number of areas in North America face adequacy risks as early as 2025.”

In addition to forecasts for extreme heat this summer, other risk factors cited in the report include continued supply chain delays for utilities seeking to acquire essential equipment and the potential for wildfires in late summer as conditions grow hotter and drier.

NERC’s assessment also warns that the areas most at risk have these additional challenges:

• New England: The retirement of two natural-gas-fired generators at Mystic Generating Station in Massachusetts this month means that the region will have 1,400 megawatts less capacity this summer, increasing the risk of energy emergencies.
• The Midwest: While there is some new solar and natural-gas-fired generation in the region, it is being offset in part by generator retirements and mandates to reserve more fuel. If demand rises higher than the normal peak, wind and solar resources may not be enough to meet it.
• The Southwest: The ongoing severe drought raises the risk that extreme conditions could affect the bulk power system.
• Texas: There is a risk of emergency conditions in the summer evening hours when solar generation begins to ramp down but demand remains high.
• California/Mexico: The biggest risk is in the Baja area, which could suffer energy shortfalls if demand is above normal due to widespread extreme heat and solar power output is below normal because of transmission limitations.

Erin Kelly is a staff writer for NRECA.

A new rule guiding the federal environmental review process for major infrastructure buildouts will impede critical projects needed to ensure reliable and affordable power, NRECA says.

The White House Council on Environmental Quality released its final Phase 2 rule under the National Environmental Policy Act on April 30. Despite Congress’ efforts to make the NEPA process more timely and efficient through the recently enacted Fiscal Responsibility Act in 2023, the administration layers on new requirements that undermine those improvements.

The administration’s rule, which applies to projects needing federal permits or that receive federal loans or grants, includes provisions that will make the NEPA process less efficient and more burdensome.

“CEQ’s final rule takes our nation in the wrong direction and further undermines reliable electricity,” NRECA CEO Jim Matheson said. “It will delay key infrastructure projects by prolonging and complicating environmental reviews while increasing litigation risk.”

The rule elevates certain environmental considerations, including a project’s climate impacts, above others. That is inconsistent with NEPA’s historical approach of using an objective project-specific method to assess proposed actions and would favor certain types of infrastructure over others, according to NRECA.

Furthermore, the final rule will require environmental mitigation measures and monitoring and compliance plans that CEQ lacks the authority to mandate under NEPA. The rule also adds new requirements for agencies that want to establish and apply categorical exclusions that allow low-impact activities to avoid more extensive NEPA reviews.

The Phase 2 rule will apply to projects starting environmental reviews on or after July 1.

“Our broken permitting system already makes it exceedingly difficult to add new energy resources to the grid,” Matheson said. “This rule makes that problem worse.”

Molly Christian is a staff writer for NRECA.

Georgia’s Plant Vogtle Unit 4 began operation on Monday, completing the first from-scratch expansion of advanced commercial nuclear energy in the U.S. in more than three decades and bringing the region’s electric cooperatives a source of reliable, clean energy well into the future, said Oglethorpe Power, a part-owner of the facility.

“We celebrate not only the completion of this important emission-free resource, but also the historic achievement it represents,” said Mike Smith, president & CEO of the generation co-op based in Tucker, Georgia.

“Oglethorpe Power and our members are committed to navigating the transition to cleaner energy while ensuring electricity remains reliable and affordable for electric cooperative consumers. The emission-free energy generated by Unit 4 will play a crucial role in helping us deliver on that mission for generations to come.”

Oglethorpe, with more than $16 billion in assets, provides power to 38 electric co-ops serving 4.4 million consumer-members.

Vogtle Unit 4’s start-up follows that of Unit 3 in July 2023. Oglethorpe owns 30% of the twin 1,100-megawatt reactors, which are expected to operate for the next 60 to 80 years, as well as 30% of the plant’s legacy units, 1 and 2.

The completion of the units makes the 4.5-gigawatt Plant Vogtle, first commissioned in 1987, the country’s largest nuclear power station. With Unit 4 online, Plant Vogtle is also now the largest generator of clean energy in the U.S.

“As we strive to meet our members’ existing and expanding power supply needs, clean nuclear energy will remain an essential source of dependable baseload power and a vital part of our energy mix,” Smith said.

Federal tax credits had a positive impact on the project, Smith said. Following years of advocacy by NRECA and Georgia electric co-ops, with strong bipartisan support from the Georgia delegation, Congress amended a nuclear production tax credit in 2018 to allow co-ops and municipal partners of new nuclear projects to receive the tax credits. Federal guidance clarified how the tax credit could be monetized just months prior to Unit 3 going commercial.

“The tax credits are already significantly lowering the energy costs for millions of Georgia co-ops and will result in hundreds of millions in savings for rural ratepayers during the eight-year life of the tax credit,” said Smith.

He attributed the safe and successful build at Vogtle to “the tireless efforts of thousands of workers at the site.” The expansion created 800 permanent jobs to manage both new units and was the state’s largest construction job producer, peaking at about 10,000, Smith said.

Southern Nuclear operates Plant Vogtle and owns 45.7% of the facility through its subsidiary, Georgia Power. Dalton Utilities and MEAG Power own the remaining 24.3%.

Cathy Cash is a staff writer for NRECA.

The Environmental Protection Agency released four major new regulations for the electric industry Thursday, including a much-anticipated rule to cut emissions from power plants, a sweeping move that NRECA CEO Jim Matheson said will aggravate reliability concerns for electric cooperatives and other utilities nationwide.

“The path outlined by the EPA is unlawful, unrealistic and unachievable,” Matheson said Thursday. “It undermines electric reliability and poses grave consequences for an already stressed electric grid.”

The power plant rule constrains existing coal and new natural gas plants by requiring them to deploy carbon capture and sequestration, a technology that is not yet proven or commercially available. The other three new rules tighten standards for mercury and air toxics and wastewater and impose requirements on legacy coal ash sites.

“This barrage of new EPA rules ignores our nation’s ongoing electric reliability challenges and is the wrong approach at a critical time for our nation’s energy future,” Matheson said.

He noted that the power plant rule would force the early retirement of always-available generation sources and limit construction of new natural gas plants just as the power sector is facing a surge in demand from factors like transportation electrification and the rapid expansion of data centers to support artificial intelligence, e-commerce and cryptocurrency.

Under the new rule, existing coal-fired units that plan to operate past the start of 2039 must reduce emissions of carbon dioxide by 90% by 2032. Units retiring before 2039 must co-fire with natural gas at a 40% rate starting in 2030.

Existing coal units that commit to close by 2032 will be exempt from the new requirements.

The rule also requires new natural gas plants operating as baseload— above a 40% capacity factor—to capture or avoid 90% of their carbon emissions by 2032. Operation of a natural gas unit without additional emissions controls is limited to 20% capacity factor.

The standards will inhibit cooperatives’ ability to economically and reliably replace lost coal generation. Cooperatives building new gas-fired facilities will either need to install CCS capturing nearly all emissions or run new gas units that can only operate a small portion of the time. The final rule did not include hydrogen co-firing as part of the EPA’s “best system of emission reduction,” but generators can use the technology to achieve compliance, EPA said.

The updated mercury and air toxics rule sets new limits on certain coal plant emissions. The effluent standards regulate wastewater discharges into water bodies near coal plants. And the legacy coal ash rule covers surface impoundments at inactive power plants and historical coal ash disposal sites.

Molly Christian is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson today issued the following statement after the Environmental Protection Agency finalized four new rules to regulate power plants.

“The path outlined by the EPA today is unlawful, unrealistic and unachievable,” NRECA CEO Jim Matheson said. “It undermines electric reliability and poses grave consequences for an already stressed electric grid. The American economy can’t succeed without reliable electricity. Smart energy policy recognizes that fundamental truth and works to help keep the lights on. This barrage of new EPA rules ignores our nation’s ongoing electric reliability challenges and is the wrong approach at a critical time for our nation’s energy future.”

NRECA’s assessment of EPA’s power plant rule, the most impactful of the four finalized by EPA today, remains unchanged from the agency’s original proposal:

• The rule is unlawful. It violates the law, exceeds EPA’s authority, and disregards Supreme Court rulings.
• The technology isn’t ready. The rule mandates the widespread adoption of technology that is promising, but not ready for prime time.
• The timelines are unrealistic. The rule gives neither existing coal units nor new gas units enough time to reach compliance.

EPA finalized its rule against a backdrop of daunting threats to reliability, as electricity demand surges at the same time supply is decreasing.

The Energy Information Administration projects that power demand will reach record highs in 2024 and 2025, increasing by 2.5% and 3.2% respectively. Grid planners forecast electricity demand to grow by 38 gigawatts through 2028, the equivalent of adding another California to the grid.

Meanwhile, the North American Electric Reliability Corporation has warned that more than 110 gigawatts of always-available generation, enough to power about 35 million homes, will retire through 2033. And all or parts of 19 states are at high risk of rolling blackouts during normal peak conditions over the next five years.

Below is a 30-second audio clip of Matheson’s comments on the power plant rule: “What’s most concerning is that it puts electric reliability at risk.”

Download these comments in MP3 format.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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WASHINGTON—More than 1,200 electric cooperative leaders gathered in the nation’s capital this week to meet with members of Congress and Biden administration officials and push for policies that ensure reliable, affordable electricity for rural America.

“Your voices matter,” NRECA CEO Jim Matheson told co-op leaders Monday at the association’s 2024 Legislative Conference on Capitol Hill. He cited a list of recent policy victories that include unprecedented funding opportunities for co-ops to invest in innovative energy technologies.

Co-ops bring a unique message to Congress and federal agencies because they are not-for-profit and are owned by the consumer-members they serve, said Louis Finkel, NRECA’s senior vice president of Government Affairs.

“We’re about people, not profits,” he said.

That message was reinforced by Deputy Agriculture Secretary Xochitl Torres Small as she addressed the conference. She said the USDA listens to co-ops because they are so connected to their communities.

“You are deeply respected—not only in rural development, but across USDA,” she said.

As co-ops tap into an unparalleled amount of new federal infrastructure funding from the bipartisan infrastructure law and the Inflation Reduction Act, “we are sharing an historic moment with you,” Torres Small said.

“This is the single largest infrastructure investment since the Rural Electrification Act in 1936,” she said. “That’s why it’s so important we’re partnering today.”

As part of advocacy efforts by NRECA and its members, Congress included a provision in the IRA that created the Empowering Rural America (New ERA) program, which provides $9.7 billion in grants and loans to co-ops for new and innovative clean energy systems. Co-ops have embraced the opportunity, submitting applications for more than $46 billion in projects.

The legislation also included direct-pay tax credits to help deploy new energy technologies, including carbon capture, nuclear, energy storage, renewables and more.

“Electric cooperatives have been remarkably successful in this challenging political environment,” Matheson said.

NRECA recently helped convince the Department of Energy to dramatically scale back a proposed rule that would have made it difficult for co-ops to get the distribution transformers that are essential for them to modernize their systems and help communities recover from disasters.

But, as the demand for electricity grows, challenges to reliability “are being exacerbated by bad public policy,” Matheson said.

The top priority for co-op leaders this week was to voice strong opposition to the Environmental Protection Agency’s power plant proposal, which threatens reliability by setting unrealistic deadlines and relying on technology that is not yet ready for wide-scale use, Matheson said. The EPA is expected to issue its final rule soon.

“We believe it’s unlawful, unreasonable and unachievable,” he said.

Co-op directors, CEOs and leaders of their statewide associations took that message to Congress as they met with lawmakers and their staffs.

Carolyn Turner, executive director of the Nevada Rural Electric Association, said it’s important for co-op leaders to meet regularly with their senators and House members, both in Washington and their home states, to ensure that the co-op message is heard.

“You’ve really got to make that personal connection,” she said, speaking as part of a panel at the conference’s Women in Power luncheon Monday. “It can make the difference in having that win at the end of the day.”

Erin Kelly is a staff writer for NRECA.

The Department of Energy has finalized new energy efficiency standards for distribution transformers, giving manufacturers more time to meet them and easing requirements that would have forced the use of less durable, hard-to-find amorphous steel in most transformers.

The final rule reflects NRECA’s advocacy priorities to maintain use of grain-oriented electrical steel and to allow manufacturers more time for compliance to help keep the focus on increased output to meet electric cooperatives’ demand for transformers. NRECA took this message to DOE, the White House and Congress, culminating in congressional requests to change the proposal, bipartisan legislation and the final rule issued on April 4.

The standard will take effect in 2029, providing an additional two years for compliance compared to DOE’s proposal.

NRECA leaders said the revised proposal is “much improved” from DOE’s initial plan, which would have made it difficult for co-ops to get the essential equipment they need to modernize their systems and help communities recover from disasters. Co-ops are already struggling to get enough transformers due to ongoing supply chain delays.

“As the nation depends on electricity to power more of the economy, a stable distribution transformer supply chain is essential to maintaining reliability and meeting growing demand,” said Louis Finkel, NRECA senior vice president for Government Relations.

“DOE’s final rule is much improved over its proposal, which would have upended the entire market for distribution transformers at a time when manufacturers could not keep up with demand for this critical equipment.”

The department’s updated efficiency standard will force some distribution transformer manufacturers to eventually switch from using grain-oriented electrical steel to amorphous steel, but it will require only about 25% of them to do so rather than nearly all as initially proposed. There is only one domestic supplier of amorphous steel in the U.S.

Most of the distribution transformers used by electric co-ops for residential or lower load settings will still be made with grain-oriented electrical steel, a more plentiful and durable resource for this key piece of equipment for keeping the lights on.

A large portion of distribution transformers used for some commercial loads, as well as certain new electric vehicle charging sites, will require amorphous steel.

NRECA had urged DOE to reconsider its proposal to shift nearly the entire market to amorphous core transformers in comments last year, outlining concerns about the material’s core durability, its limited availability and the utility sector’s operational and equipment burdens to make the change.

“It was also a serious risk that the lone domestic supplier of grain-oriented electrical steel would leave the market, harming the potential outlook for more domestic large power transformer manufacturing,” said Stephanie Crawford, NRECA regulatory affairs director. “DOE’s final rule now walks back that potential risk, hopefully leading to more domestic investment in grain-oriented electrical steel supply.”

“The final rule provides stability for most of the market, while affording a more gradual shift toward tighter efficiency standards for transformers used to meet larger commercial and certain electrification loads,” said Finkel. “We will work closely with our members, manufacturers and suppliers to ensure implementation does not further disrupt an already strained supply chain.”

Cathy Cash is a staff writer for NRECA.

A long-simmering dispute in the Pacific Northwest over the management of the Lower Snake River dams burst onto the headlines late last year with the news of a backroom deal between the Biden administration and the plaintiffs in a lawsuit against the Bonneville Power Administration and other government agencies that manage the dams.

The deal, which has now become a formal memorandum of understanding between the parties, was done without the input of key interests, including the irrigation, shipping and power industries, and has raised fears about the possibility of breaching the dams and compromising the availability of reliable, carbon-free electricity at a time when demand in the region is set to skyrocket.

To discuss the history and on-the-ground impact of this major development, we’ll talk with Louis Finkel, NRECA’s senior vice president for Government Relations, and Bryan Case, CEO of Fall River Rural Electric Cooperative in Idaho.

Listen to the episode below:

You can also listen and subscribe to Along Those Lines on your preferred podcast service:
Apple Podcasts | Google Podcasts | Stitcher | Spotify | YouTube

Related Content:

• Matheson to Congress: Snake River Dams Are Vital to Power Supply in Northwest
• Nearly 20,000 Co-op Members Urge Biden to Preserve Snake River Dams
• NRECA Blasts Secret Deal That Would Jeopardize the Lower Snake River Dams

Find out more about NRECA’s podcast. Questions or suggestions? Email us at AlongThoseLines@nreca.coop.

Seven electric cooperatives will join a nearly $58 million cost-share program with the Department of Energy to build a range of microgrids to improve grid resiliency and reliability for remote and economically challenged communities across the country.

DOE announced Feb. 27 that it will negotiate $45.2 million in funding for the co-ops under the Office of Clean Energy Demonstrations’ Energy Improvements in Rural or Remote Areas (ERA) Program, part of the bipartisan infrastructure law. The co-ops will provide an additional $12.6 million. The final budget for the five-year program will be determined after award negotiations are completed this year.

NRECA led the seven-co-op consortium in applying for funding for the Microgrids for Community Affordability, Resilience, and Energy Decarbonization (CARED) project. Project technologies will include solar PV and battery energy storage systems with distribution upgrades.

“These electric co-ops will build microgrids so vulnerable communities can mitigate extreme weather risk and end-of-the-line connectivity issues and support essential and emergency services,” said Tolu Omotoso, director of energy solutions at NRECA and principal investigator/program manager for the project.

“Without this investment by DOE, these critical projects would not happen.”

The seven microgrid consortium co-ops are:

• Anza Electric Cooperative in Anza, California.
• Blue Ridge Energy in Lenoir, North Carolina.
• Flathead Electric Cooperative Inc. in Kalispell, Montana.
• Minnesota Valley Electric Cooperative in Jordan, Minnesota.
• Missoula Electric Cooperative in Missoula, Montana.
• Trico Electric Cooperative in Marana, Arizona.
• Volunteer Electric Cooperative in Decatur, Tennessee.

In addition to improving grid resiliency and reliability in needy areas, CARED objectives include establishing a forum for sharing information and creating new jobs that support the local economies served by the participating co-ops.

The project team estimates, for example, that the Volunteer Electric’s microgrid may provide an annual electricity savings of $400,000 for the town of Decatur, while Flathead Electric’s microgrid in Cooke City may slash power outages by 70%.

DOE also selected Brighton, Colorado-based United Power for $6 million in funding from the ERA program to build a microgrid with PV and battery storage to replace an aging diesel generator at a water treatment plant for the city of Fort Lupton. The microgrid will ensure reliable clean water for the community, and a 20-year agreement will keep the project affordable with United Power owning the microgrid and the city paying for its upgrades.

“This funding is an important step as electric co-ops work to improve access to affordable and reliable energy in rural America,” said NRECA CEO Jim Matheson. “By deploying microgrids in communities across the country, co-ops are exploring new ways to keep the lights on and meet tomorrow’s energy needs.”

Cathy Cash is a staff writer for NRECA.

San Miguel Power Association is exploring community-scale microgrids to boost resiliency for four remote towns in Colorado’s San Juan Mountains where blizzards and avalanches have threatened reliability.

Silverton, one of those communities, sits nearly 10,000 feet above sea level along a single mountain road. Last winter it was hammered by what locals call a “snowpocalypse” that took out electricity for several hours.

“The snow was blowing sideways. It really was blizzard conditions,” said Alex Shelley, communications executive for the Nucla-based co-op. “All access to the town was cut off, and folks were cold.”

Fortunately, SMPA had seen the forecast and, to stem an eventual outage, sent a lineworker to Silverton prior to the storm to work with another lineworker, one of the town’s 650 residents. When disaster struck, the pair managed to repair the line and restore electricity within several hours. They later received a commendation from the mayor.

But the experience spurred the co-op to find a solid resiliency solution to meet the power needs of the whole community during an emergency.

“We’re owned by our members, and we are laser-focused on providing the best service that we can for them, and that includes reliability and safety and resiliency as well as affordability and environmental responsibility,” said Shelley. “All of those are parts of our mission, and microgrids have the potential to tick every one of those boxes.”

Microgrids provide temporary, limited electricity by employing small local generation and batteries for energy storage when there is a disconnection from the main power grid.

Electric co-ops nationwide have installed and operated custom microgrids for targeted resiliency at medical facilities, military bases, schools or specific neighborhoods during power outages.

SMPA has assisted with microgrids for the San Miguel County Sheriff’s Office and a school in Telluride, but “the ones we are proposing are all meant to back up the power needs of the entire community so if the grid went down, that system could isolate and produce power,” said Shelley.

In addition to Silverton, SMPA is proposing microgrids to provide four hours of power to the towns of Ophir, population 195; Rico, population 347; and Ridgway, with over 1,200 residents.

These larger microgrids could help people stay warm and charge their devices until repairs to the power lines can reconnect their communities to the grid, Shelley said.

The co-op obtained grant money for the Silverton microgrid from the Department of Energy’s Office of Clean Energy Demonstrations and from the state Department of Local Affairs for the other three.

SMPA is working with a consultant to propose the microgrid projects and account for variables of size, location and capabilities. “There’s no one-size-fits-all solution,” said Shelley.

After pre-build design, engineering and community outreach is completed this year, SMPA hopes to obtain construction grants from the state to break ground in 2025.

“For several reasons like increasing frequency and intensity of extreme weather events, proliferation and decreasing costs of DERs, microgrids are becoming essential building blocks of the future of the grid,” said Tolu Omotoso, NRECA energy solutions director. “Microgrids offer multiple ways to integrate renewables, improve reliability and support resilience of remote communities. It’s great to see electric cooperatives leveraging federal and state funding opportunities to develop microgrids to serve their members.”

Co-ops exploring microgrids can join NRECA’s Microgrid Consortium for unique opportunities to share ideas and lessons learned from deployments and find out about funding programs and ways to leverage innovative partnerships with technology.

Cathy Cash is a staff writer for NRECA.

Efforts to breach the four Lower Snake River dams in Washington state threaten the future of the region’s power supply, putting dozens of Northwest electric cooperatives and their consumer-members at risk, NRECA CEO Jim Matheson told a House panel Tuesday.

“Hydroelectric power generated by the Columbia River System is the foundation of the electric grid in the Northwest,” Matheson told the House Energy and Commerce Subcommittee on Energy, Climate and Grid Security.

“It is the key to electric reliability, economic prosperity and public safety. Put simply, hydropower is the reason why the lights stay on in the Pacific Northwest. Breaching or chipping away at the Lower Snake River dams pulls a critical, dispatchable, carbon-free renewable resource out of the mix at a time when electric demand continues to grow.”

Matheson testified before the panel about a controversial legal settlement reached by the Biden administration, environmental groups, and tribal and state governments over the federal government’s operation of the Lower Snake River dams. Those dams supply hydropower to 55 co-ops in eight Western states served by the federal Bonneville Power Administration.

In a lawsuit filed in 2021, plaintiffs charged that the dams are threatening the survival of endangered salmon. The settlement supports breaching the dams and replacing them with other types of renewable energy.

Although it would take an act of Congress to actually breach the dams, the settlement agreement undermines their operation, Matheson said.

“While the dams are not physically breached by the agreement, the mandated spill and flow requirements chip away at the economic viability of the dams with the goal of making them uneconomical to operate,” he said.

It won’t just be electric power providers who will be hurt, Matheson added.

“It will adversely impact agricultural producers, the transportation sector and economically disadvantaged rural communities,” he said.

For decades, the hydropower provided by the Columbia River System has fueled economic growth in the region, Matheson said.

“The region’s hydropower is a major attraction for economic investment in the Northwest,” he said. “Companies locate their operations in the Northwest to take advantage of the reliable, affordable and carbon-free hydropower. Small family-owned businesses, electric vehicle manufacturers, agricultural producers and tech giants have all based operations in the Northwest because of hydropower.”

Although power generation within the BPA system includes wind, solar and biomass, those sources are dwarfed by hydropower, which makes up nearly 80% of capacity, Matheson said.

The settlement envisions replacing Lower Snake River dam hydropower with other renewables. Matheson raised concerns with this, noting that “hydropower is not interchangeable with wind or solar. Hydropower is a dispatchable resource, meaning it can be adjusted to meet demand and is ever-ready as a source of baseload power. Wind and solar, on the other hand, are unpredictable.”

Matheson also denounced the exclusion of co-ops and other electric utilities in the settlement talks.

“No one from the electric consumer sector was included in the final closed-door negotiations that led to this settlement,” he said. “The people that keep the lights on were purposefully kept in the dark…This settlement process sets a dangerous precedent of exclusion.”

Erin Kelly is a staff writer for NRECA.

Electric cooperatives are eager to develop resources for enduring reliable and affordable energy, but the federal government must do its part to help keep the lights on with rational public policy for a growing economy, NRECA CEO Jim Matheson told utility leaders in Washington.

“It’s a great time to seize opportunities to be an even better country, and it’s going to require reliable, affordable energy to make it happen,” Matheson said in a discussion on energy use and supply at the U.S. Energy Association’s 20th Annual State of the Energy Industry Forum Jan. 23.

“But we have to acknowledge the risks to meeting that need, and one of the biggest risks is the role of public policy.”

The North American Electric Reliability Corp. has “for the first time ever identified public policy as one of the primary risks in terms of electric reliability, and you can see that playing out now” in the Environmental Protection Agency’s proposed power plant rule, Matheson said.

“We are very concerned about reliability. We are very concerned about premature closure of plants” because of the current regulatory environment, he said.

EPA proposes to eliminate carbon dioxide emissions from coal- and gas-based power plants starting in 2030 by requiring carbon capture and storage and co-firing clean hydrogen at power plants, two technologies still under development.

“That’s an example of public policy going in the wrong direction,” Matheson said. “It relies on technology that is not mature, and it relies on the hope that somehow, they’re going to be in place in time. Hope is not a good strategy, and it sure isn’t good policy.”

In contrast, the U.S. Department of Agriculture’s new $9.7 billion voluntary program designed specifically for electric co-ops turned out more than double the expected participants to build and invest in clean energy resources. Electric co-ops oversubscribed to the Empowering Rural America (New ERA) with $26 billion in project applications that would launch $93 billion in investments across rural America, he said.

“Electric co-ops are answering the call for innovation,” Matheson said. “We are going to continue to be the voice advocating for rational policy in terms of making sure when our members at the end of the line flip the switch, the light comes on, and when the bill comes at the end of the month, they can afford to pay it.”

Cathy Cash is a staff writer for NRECA.

Since the shock of Winter Storm Uri in 2021, Texas residents have been increasingly investing in things like home generators, battery storage systems and rooftop solar to gain more control over their power supply amid the state’s continuing reliability challenges. Rayburn Electric Cooperative officials say this development is having a big impact on the way its member co-ops run their load management programs.

“In coordination with our distribution members, we’ve identified a large amount of home standby generators on our member systems by working directly with vendors and manufacturers,” said Christian Nagel, director of power supply at the generation and transmission co-op. “They’ve helped us identify members who’ve installed home energy equipment, and that’s helped us focus more attention on developing DER incentives.”

In late 2022, Rayburn— based in Rockwall with four distribution co-op members in northeastern Texas—worked with its members to design DER programs that offer financial incentives to encourage member engagement in helping manage the grid. That approach could be particularly beneficial during periods of high demand, when wholesale pricing for electricity spikes.

“We want to be able to leverage member home energy assets for both ancillary generation and load reduction,” said Nagel. “That will not only reduce demand for wholesale power, it will also help us control transmission costs, particularly during system peaks so we can pass on those savings to our member co-ops.”

Recent extreme weather events have increased the frequency of calls for voluntary conservation and emergency alerts for Electric Reliability Council of Texas members, including some that faced onerous wholesale power costs to meet high demand during heatwaves and extended cold snaps. Plant failures, limited transmission and fuel supply issues have been cited as contributing factors.

“Our member co-ops are working with us as they each develop their own specific retail rate designs that accommodate various resources like solar and energy storage,” said Nagel, noting that Rayburn recently added a DER specialist to its staff.

Those efforts require more complex solutions than determining where those resources are located and using them. Among the rate incentives currently being offered by the member co-ops are billing credits for participation and help in installing home generators, batteries and other devices, said Nagel.

“Rayburn and our members are also finalizing other incentives such as time-of-use rates as we look to add electric vehicles to the DER program,” he said.

Other developments, like increased telework, a proliferation of server farms and the growth of the electric vehicle market, are also impacting how and when electricity is used and increasing overall residential demand in Rayburn’s territory.

“Load is growing faster than dispatchable generation can be installed in the current ERCOT environment,” said Marc Cantrell, Rayburn’s director of power plant operations.

That prompted Rayburn to acquire a 758-megawatt natural gas-fueled plant in Grayson County previously owned by a private investor firm. The facility, which has been among ERCOT’s listed resources since 2014, has been rebranded as Rayburn Energy Station.

Its turbines can be ramped up to 50% power production within 10 minutes and full capacity within 30 minutes, allowing it to balance output from renewable energy resources.

“The addition of this key resource to our portfolio of solar, hydro and market purchases strategically positions Rayburn to ensure our member cooperatives are served with a broad energy resource mix,” said David A. Naylor, CEO of the G&T.

Rayburn officials support some changes made by ERCOT after winter storms Uri and Elliott, including real-time analytics and improved seasonal outlook forecasting. But the co-op continues to call for more improvements in demand response programs and preservation of sporadically used generation.

“Co-ops can invest in demand response programs, but during prolonged major weather events, there is little distribution co-ops can do to avoid calls for mandatory load shedding because of our residential load profile,” said Naylor.

“When these winter systems hit north Texas, we see our load double or triple depending on weather severity. Our challenge is making sure that we have enough supply to meet those large variances in load. Demand response can help us do that, particularly until adequate generation is available.”

Derrill Holly is a staff writer for NRECA.

NRECA is supporting a bipartisan Senate bill that seeks to prevent electric cooperatives from having to wait even longer to get the distribution transformers they need to modernize their systems and help communities recover from disasters.

The Distribution Transformer Efficiency and Supply Chain Reliability Act of 2024 would effectively override a proposed rule from the Department of Energy.

That rule, if finalized as initially proposed, would marginally increase efficiency while effectively requiring all distribution transformer cores to be made with amorphous steel by as early as 2027, said NRECA Legislative Affairs Director Will Mitchell.

The DOE says amorphous steel cores save energy because they capture and transmit more electricity. However, the U.S. currently makes 95% of its distribution transformers with grain-oriented electrical steel and has only one small domestic producer of amorphous steel.

The legislation introduced Thursday by Sens. Sherrod Brown, D-Ohio, and Ted Cruz, R-Texas, would prevent grain-oriented electrical steel from being forced out of the market. It also would give transformer manufacturers 10 years to begin meeting higher efficiency standards, allowing a gradual phase-in.

“This legislation is a bipartisan antidote to DOE’s unworkable proposal to rapidly tighten transformer efficiency standards, which would exacerbate the already long lead times electric cooperatives face to obtain distribution transformers,” said NRECA CEO Jim Matheson.

“The bill would allow for the adoption of an updated standard over a more realistic timeframe while ensuring the appropriate supply of grain-oriented steel that manufacturers need to speed transformer production.”

Supply chain challenges that began during the COVID-19 pandemic have continued to cause severe delays for co-ops trying to buy new transformers. The problem has been complicated by record demand for electric grid components nationwide and a shortage of skilled workers to produce transformers, Mitchell said.

In a recent letter to Senate leaders, NRECA and other interested groups said that the average time it takes to order and receive a new distribution transformer is about two years—twice what it was before the pandemic.

The bill is supported by ERMCO, the Tennessee-based manufacturer that is the nation’s largest producer of oil-filled distribution transformers. Cleveland Cliffs of Ohio, ERMCO’s primary steel supplier, also favors it.

“A strong domestic supply of transformers is crucial to our electric grid and our energy independence,” Brown said. “We need to meet increasing demand for transformers, while keeping this critical supply chain in the U.S. and making sure the Department of Energy gets it right. That’s why we introduced this bill with a new standard that supports American jobs and our energy independence.”

Cruz called DOE’s proposed rule “a misguided effort to improve efficiency.”

“We all agree that efficient energy is a good thing that benefits consumers, but by effectively forcing the distribution transformer industry to change the type of steel it uses almost overnight, DOE’s rule would actually jeopardize electricity distribution for millions of Texans and Americans, with potentially disastrous results during extreme weather.”

Erin Kelly is a staff writer for NRECA.

As the 2024 election year begins, an already divided Congress may well be struggling to reach consensus on crucial legislation while the Biden administration rushes to issue new federal regulations.

That’s the climate that NRECA’s Government Relations team likely faces as it advocates on behalf of electric cooperatives on Capitol Hill, at the White House and with federal agencies.

In a recent Q&A session, Louis Finkel, NRECA’s senior vice president of Government Relations, talked about how the association will work aggressively to ensure that new bills and regulations help not-for-profit co-ops continue to provide reliable, affordable electricity to their consumer-members.

Electric co-ops have begun winning awards for millions of dollars from the bipartisan infrastructure law and the Inflation Reduction Act, thanks to provisions that NRECA helped secure in those bills. Do you expect the flow of funding to co-ops to continue in a big way this year?

Finkel: First, the biggest issue before Congress this year is going to be funding the government, as it was last year. There is an ongoing tension between the Biden administration, Senate Democrats and House Republicans, with House Republicans wanting to cut funding in the bipartisan infrastructure law and the Inflation Reduction Act.

As we sit here in January, Congress is still working on funding the government for the current fiscal year and then will have to quickly turn to funding for the next fiscal year.

In that context, we continue to educate members of Congress about the value of new incentive programs designed to harden the grid and create greater resiliency in the face of a changing energy environment while looking for opportunities to solidify the reliable, affordable power that electric co-ops offer.

Getting provisions that benefit co-ops into law was really important, but shaping the programs and the guidance that comes out of the federal agencies that implement them has been just as important.

We have been engaged with the agencies to make sure that misguided agency interpretation does not undermine these programs and that they are implemented in the way that Congress intended them to be.

Congress is continuing to try to craft a new five-year Farm Bill that could include crucial funding for co-op infrastructure projects, rural economic development and broadband. What are the prospects for its passage this year? And what is NRECA doing to help shape Farm Bill programs that benefit co-ops and their members?

Finkel: Congress extended the current Farm Bill through the end of the year, which bought them some breathing room. There are some broad differences of opinion between the two parties on a range of programs—most of which don’t directly impact our co-ops.

Our intent is to work with members on both sides of the aisle and in both chambers to reinforce the important role that the Rural Utilities Service programs play as a crucial resource for infrastructure and system improvements and routine maintenance—all with a focus of keeping the lights on. Healthy, strong RUS programs are an important resource for co-op communities throughout the country.

What are some of NRECA’s other legislative priorities for 2024?

Finkel: Though we always have policy matters that we raise, oftentimes our message is driven by the congressional agenda, which could be really narrow this year.

We will look for ways to continue to address supply chain difficulties to ensure co-ops can get transformers in a reasonable time frame, and we’ll push Congress to use some government resources to further alleviate supply chain woes.

Congress is set to reauthorize the Water Resources Development Act, and in light of the recent developments in the Pacific Northwest and the administration’s backroom deal to undermine dams on the lower Snake River, we’ll be aggressively engaged to make sure there are no provisions in the bill to breach those dams.

We’ll continue to push for legislation to expedite permitting and alleviate the endless litigation that stifles the construction of infrastructure as well as advocate for transmission policies that allocate costs to those that benefit the most.

And related to broadband, there continues to be noise about changing the nature of the pole attachment exemptions for electric cooperatives, mostly by other participants in the broadband industry. We continue to educate members of Congress about the importance of the Federal Communications Commission exemptions for our members and how our members and our service territories are different.

With the recently installed Democratic majority at the FCC, we’ve seen a lot of proposals come forward, most notably one on net neutrality. NRECA is asking the FCC for targeted compliance exemptions for electric co-ops in any new net neutrality rules. Co-ops support net neutrality and treat all their broadband consumers equally, but excessive, onerous regulation could divert crucial investment away from the communities they serve.

NRECA has strongly opposed the Environmental Protection Agency’s proposed power plant rule as a threat to co-ops’ ability to provide reliable, affordable power. What can we expect to see on this front in 2024?

Finkel: We expect to see a final rule in the spring, and we’ll continue to oppose the rule, which may very well result in litigation. We’ll continue to push back on the EPA’s overreach, which oversteps its statutory authority and hampers co-ops’ ability to provide reliable, affordable power.

We’ll oppose this kind of overreach by any federal agency, whether it’s the EPA or any other agency. We’ll continue to aggressively raise concerns where necessary and embrace proposals where they make sense.

This is obviously a huge election year with both the presidential and congressional elections. Do the elections complicate NRECA’s efforts to achieve its legislative and regulatory priorities?

Finkel: I don’t think it complicates our ability to achieve anything, but it complicates our ability to advance an agenda. With a divided Congress, it is already really hard to legislate, and even more so in an election year.

On the regulatory side, new proposals are unlikely to get finalized within a year. So, most new regulations that get put forward now are just markers for the president to tell voters what is important to his administration.

In that context, we will continue to oppose shortsighted policies and continue to support policies, both in Congress and in regulatory proposals, that serve the interests of our members and their consumer-members.

Erin Kelly is a staff writer for NRECA.

NRECA has joined a coalition of energy, manufacturing and homebuilder groups urging Senate leaders to include $1.2 billion in funding for distribution transformers and other critical electric grid components in an energy and water spending bill that lawmakers are negotiating.

“Ongoing supply chain challenges and unprecedented demand for grid components require additional investment to assist manufacturers in expanding capacity in order to counteract a distribution transformer shortage and ensure nationwide grid reliability and resilience,” NRECA and other coalition groups wrote in a Jan. 4 letter to Senate Majority Leader Chuck Schumer, D-N.Y., Minority Leader Mitch McConnell, R-Ky., Appropriations Committee Chairman Patty Murray, D-Wash., and Appropriations Committee Vice Chairman Susan Collins, R-Maine.

The coalition is led by the National Electrical Manufacturers Association and includes the American Public Power Association, Edison Electric Institute, GridWise Alliance, Leading Builders of America and National Association of Home Builders.

In July, the Senate Appropriations Committee unanimously approved language that included $1.2 billion in repurposed supplemental funding for the Department of Energy’s Office of Electricity and the Grid Deployment Office to strengthen the transformer and critical grid component supply chain with additional financial assistance, procurement, technical assistance and workforce support. Coalition leaders are urging the Senate to include that provision in any final spending bill it negotiates with the House.

“Using this supplemental funding to accelerate the manufacturing of distribution transformers and other grid components will help electric co-ops keep the lights on and meet future energy needs of 42 million Americans,” NRECA CEO Jim Matheson said.

“The funding would significantly shorten transformer lead times while strengthening domestic supply chains. We urge the House and Senate to include this funding in a final FY24 appropriations bill.”

Before the COVID-19 pandemic, it took an average of one year to order and receive a new distribution transformer, the coalition leaders said.

“Today, due to complexities and inefficiencies in the supply chain, that schedule has grown to more than two years,” the letter states. “Record demand for these products, the lack of available skilled labor to produce them, and challenges acquiring various components and materials which go in them are causing real world problems: new building and housing construction projects have been stalled and utilities are unable to modernize the grid and help communities recover quickly from disasters.”

The letter added that “robust domestic production of distribution transformers is essential to ensuring a reliable U.S. grid while reducing dependence on foreign products.”

The legislative language approved by the Senate Appropriations Committee would “help domestic manufacturers increase capacity and catch up to existing orders, all while providing greater certainty to end-users of critical grid components,” the coalition wrote.

Erin Kelly is a staff writer for NRECA.

Read a new op-ed by NRECA CEO Jim Matheson, published by Fox News on Jan. 5, outlining how our national energy policy is threatening reliable, affordable electricity, and America’s economy as a result: Our Broken Energy Policy Could Leave Americans in the Dark

Matheson also recently joined Bret Baier at Fox News on “Special Report” to discuss the importance of keeping the lights on amid rising demand for electricity. He addressed topics such as new electric vehicle infrastructure and hyperscale data centers along with the growing significance of microgrids in enhancing power resilience. View the highlights below:

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement on the North American Electric Reliability Corporation’s (NERC) 2023 Long-Term Reliability Assessment:

“NERC’s latest assessment paints another grim picture of our nation’s energy future as demand for electricity soars and the supply of always-available generation declines,” Matheson said. “Nine states saw rolling blackouts last December as the demand for electricity exceeded available supply. And proposals like the EPA’s power plant rule will greatly compound the problem. Absent a major shift in state and federal energy policy, this is the reality we will face for years to come.” 

NERC’s assessment highlights growing concern over the next 10 years. “Key measures of future electricity demand and energy needs are rising faster than at any time in recent years, adding to future resource adequacy concerns at a time of unprecedented transformation in the industry.” It warns that “an increasingly large portion of North America is at risk in the future.”

NERC recently listed energy policy as a threat to reliability. PJM, a grid operator throughout the mid-Atlantic, recently projected that 25 GW of power generation, enough to power nearly 19 million homes, will soon be taken offline in the region because of shortsighted state and federal policies.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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NRECA CEO Jim Matheson on Friday blasted a covert agreement between the Biden administration and hydropower plaintiffs that threatens hydropower production at four Lower Snake River dams, a move that would compromise electric reliability and affordability for millions in the western United States who rely on the carbon-free energy resource.

The draft settlement agreement seeks to solve long-standing litigation surrounding the Lower Snake River dams, part of the Federal Columbia River Power System. It was made public by lawmakers from the Pacific Northwest on Nov. 29.

“The proposed backroom deal is deeply alarming and would jeopardize reliable electricity for millions of Americans in the West,” Matheson said. “Not only does this expose a severe lack of understanding about the importance of keeping the lights on, it also reveals the administration’s misplaced desire to undermine our nation’s essential portfolio of carbon-free hydroelectric resources without considering the cost. This is another egregious example of proposed government actions having devastating real-world consequences.”

NRECA and the American Public Power Association sent an urgent letter to Energy Secretary Jennifer Granholm and White House advisers expressing concern about the impact of the administration’s proposal, which did not include meaningful input from electric utilities in the region.

“If this agreement is ratified, it would jeopardize electric reliability and increase costs for millions of Americans throughout the Pacific Northwest,” Matheson and Scott Corwin, APPA president and CEO, said in the Dec. 1 letter.

“The draft agreement clearly shows that the Administration’s goal is dam breaching, a conclusion that runs counter to decades of studies, science and governmental actions and an outcome that would destabilize the economy of an entire region of the nation.”

The Pacific Northwest congressional delegation raised numerous concerns and questions about the confidential agreement in a Nov. 29 letter to President Joe Biden, including how grid reliability would be maintained without the 24/7 baseload carbon-free energy provided by the dams.

Regional trade associations whose members include electric cooperatives, including Northwest RiverPartners and the Public Power Council, also expressed extreme concern about the lack of transparency and how the proposed actions would harm the region.

Cathy Cash is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today expressed alarm over a secret deal that would set in motion steps to breach the Lower Snake River Dams. The proposed deal was made public by lawmakers from the Pacific Northwest on Nov. 29.

“The proposed backroom deal is deeply alarming and would jeopardize reliable electricity for millions of Americans in the Pacific Northwest,” Matheson said. “Not only does this expose a severe lack of understanding about the importance of keeping the lights on, it also reveals the administration’s misplaced desire to undermine our nation’s essential portfolio of carbon-free hydroelectric resources without considering the cost. This is another egregious example of proposed government actions having devastating real-world consequences.”  

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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Electric cooperatives’ well-publicized concerns about grid reliability under an Environmental Protection Agency plan to rapidly eliminate carbon dioxide emissions from the power sector were front and center at a recent conference at the Federal Energy Regulatory Commission, the independent agency charged with protecting the bulk power system.

As proposed, EPA’s rule would result in the “disorderly retirement and elimination of baseload generation at alarming rates that will leave the electricity grid with a significant deficit of dispatchable generation as replacement generation will not be available,” said Tony Campbell, president and CEO of East Kentucky Power Cooperative, at the FERC technical conference on reliability on Nov. 9.

EPA is slated to finalize a rule in spring 2024 to require zero-emission generation by 2035.

To comply, power providers likely would curtail output from coal plants to below 20% annual capacity by 2032, then completely retire them by 2035, Campbell, who testified on behalf of NRECA, told the commissioners. New natural gas unit capacity would likely be limited to below 20% starting in 2032.

Campbell called on FERC to use its authority to have the North American Electric Reliability Corp., the entity charged with establishing reliability standards for the grid, assess the impact of the EPA proposal and weigh in during the federal interagency review process.

“Policymakers should look to NERC for guidance before they pass rules that will impact the reliability of the grid,” he said. “The question for this conference is whether or not reliability can be salvaged.”

Campbell told the commission that the EPA’s proposed solutions—carbon capture and sequestration and using zero-emission hydrogen as fuel—are unproven technology that “will not be available within the compliance timeframe, even putting aside the costs to implement them.”

Plus, infrastructure development, siting and permitting required to deploy both CCS and clean hydrogen are years beyond the EPA’s deadlines, he said.

“The proposed rule exceeds EPA’s authority under the Clean Air Act, hinges on widespread adoption of technologies that have not been adequately demonstrated to work at commercial scale while achieving EPA’s requirements, and contains unrealistic and unachievable time frames,” said Campbell.

“EKPC and NRECA’s overall position is that EPA’s proposal is unlawful and unworkable. The only way that the proposed rule will not have a detrimental effect on electric reliability is for EPA to withdraw it.”

Cathy Cash is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement on the newly released North American Electric Reliability Corporation’s (NERC) 2023-24 Winter Reliability Assessment. NERC is the not-for profit regulatory authority focused on assuring grid reliability. 

“This forecast again shows that our nation faces looming grid reliability challenges while demand for electricity continues to soar,” Matheson said. “That’s unacceptable and should be cause for concern for all Americans. To avoid catastrophe, policymakers must recognize their role in threatening the reliability of the grid and take steps to help prevent rolling blackouts before it’s too late.”

For years, NERC has warned that electric reliability is in jeopardy and the risk of rolling blackouts is rising. The organization recently listed energy policy as a newfound reliability risk.

“Policies like EPA’s recent power plant proposal will magnify today’s reliability challenges with grave consequences for an already stressed grid,” said Matheson. “I don’t think EPA thought about electric reliability as it drafted this rule. This unlawful, unrealistic and unachievable proposal will result in less electricity, more power outages and higher costs for American families and businesses.

“The importance of keeping the lights on transcends party lines. Reliable electricity is an issue that impacts all Americans – and is one that lawmakers in both parties must work seriously to address. As our country looks to a future that depends on electricity to power more of the economy, it is vital that we work together to avoid harming the electric grid that will be foundational for the future.”

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $15 billion annually in their communities.

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The U.S. Department of Energy has selected dozens of electric cooperatives to pursue contracts worth about $650 million from its $10.5 billion Grid Resilience and Innovation Partnerships Program.

On Oct. 18, DOE announced the first round of potential GRIP grants totaling $3.5 billion for 58 grid projects in 44 states. Selected applicants, chosen through a competitive process, must now negotiate with DOE on the precise terms of their awards.

Among other requirements, GRIP recipients must match a portion of the federal cost and ensure the projects create high-quality local jobs that benefit economically challenged communities and cause minimal environmental impact.

Final awards will be given out in 2024.

“This infrastructure funding is an important step as electric co-ops work to harden systems and enhance the reliability of the grid,” said NRECA CEO Jim Matheson. “These projects hold tremendous potential for local communities.”

Holy Cross Energy, in partnership with NRECA and a 39-co-op consortium, was chosen for the largest co-op award, a $99 million grant toward wildfire mitigation projects across several states.

And Midwest Energy Inc. was picked for a $97 million award to upgrade substations and rebuild 150 miles of transmission lines in seven western Kansas counties.

NRECA is asking co-ops to log their application selection on the Share Your Wins page on cooperative.com.

“This unprecedented public investment in electric cooperatives to bolster grid reliability underscores how co-ops focus on their members’ best interests and why they’re ideal recipients of these federal dollars,” said Angela Strickland, NRECA senior vice president of Business and Technology Strategies. “This is a testament to co-op leadership, and we’re anxious to share stories about their exciting and significant projects.”

DOE formed the Grid Deployment Office, which administers GRIP, with money from the bipartisan infrastructure law to strengthen the reliability of the power system against extreme weather and other threats.

“Through this award, the electric cooperatives in our consortium will be able to work intentionally with our disadvantaged communities to reduce the likelihood of wildfire and the resulting losses of property and natural, community and cultural resources,” said Bryan Hannegan, president and CEO of Holy Cross Energy in Glenwood Springs, Colorado.

“The federal funding will help accelerate our work and support the development of a skilled workforce in our most disadvantaged communities, leading to stronger connections between the electric cooperatives and the people they serve.”

Patrick Parke, CEO of Hays, Kansas-based Midwest Energy, said, “This grant will help keep rates affordable for our customers as we address projects where assets are nearing the end of their service lives. Our customers and our communities will benefit as our system is improved through better reliability, increased line capacity to facilitate renewable energy access and mitigated wildfire risk.”

Other electric co-ops selected by DOE to negotiate GRIP grants for a variety of projects include:

• Arkansas Valley Electric Cooperative Corp., $18 million.
• Delaware Electric Cooperative partnering with Pecan Street Inc., $8 million.
• Kit Carson Electric Cooperative, $15 million.
• Missoula Electric Cooperative, $2.7 million.
• Mora-San Miguel Electric Cooperative, $11 million.
• Oglethorpe Power, Georgia Transmission, Georgia System Operations and Green Power EMC partnering with Georgia Environmental Finance Authority, $250 million.
• Rappahannock Electric Cooperative, $38 million.
• Southern Maryland Electric Cooperative, $33.5 million.
• Sumter Electric Cooperative, $52.8 million.
• Surry-Yadkin Electric Membership Corp., $7.5 million.
• Tri-County Electric Cooperative, $4.6 million.
• Tri-State Generation and Transmission Association, $26.8 million.

Cathy Cash is a staff writer for NRECA.

Members of Congress, electric cooperative leaders and energy analysts warned Wednesday that escalating demand for electricity is threatening to outpace supply as the federal government pushes to accelerate the transition to cleaner energy.

“We’re using more and more electricity,” said NRECA CEO Jim Matheson, citing increased demand for power from data centers, artificial intelligence and manufacturers.

“It’s a good news story in terms of the economy growing,” he said at a POLITICO event sponsored by NRECA on the future of grid reliability. “The question is just how is the electric grid going to keep up and meet that growth?”

Members of Congress from both political parties agreed that America needs to dramatically step up its electricity generation, which they said can only be done if lawmakers make it easier for electric co-ops and other utilities to get permits to expand their systems.

“We need to build a boatload of transmission in the next few decades—200,000 miles of transmission,” said Rep. Scott Peters, D-Calif.

Without those new transmission lines, renewable energy sources such as solar and wind won’t have anything to hook up to, said Peters, who serves on the House Energy and Commerce Committee.

Peters and fellow committee member Rep. Bob Latta, R-Ohio, said they support bipartisan efforts to streamline the federal permitting process so that utilities can get quicker approvals from agencies to build new infrastructure. They also want to limit how long legal challenges to federal permitting decisions can drag on.

“We have to make everything move faster,” Peters said.

Latta said there are 85,000 manufacturing jobs in his congressional district that depend on reliable power from a broad mix of sources, including nuclear.

“If we don’t have affordable power, the companies can’t compete, but most importantly they can’t provide the jobs for all those people across northern Ohio,” Latta said.

Matheson said the power supply problem would be exacerbated by the Environmental Protection Agency’s proposed power plant rule, which seeks to eliminate carbon emissions by mandating the use of new technology in new and existing coal and natural gas generating facilities. 

“This proposed rule has a couple of fundamental flaws,” Matheson said. “First, we believe the proposed rule exceeds EPA’s authority under the Clean Air Act.  Second, the proposed rule mandates the use of two technologies that aren’t ready for prime time.

“You’d either have to use carbon capture and sequestration or you’d have to use hydrogen and you’d have to be ready to do that by 2031, which is not that far away when it comes to planning and investments in infrastructure in the electric sector. So how do we get there when these technologies aren’t even ready?”

He said the rule would mean “less electricity, more power outages and higher expense.”

“That’s not what we should be doing,” he said.

Heather Teilhet, senior vice president of external affairs at Oglethorpe Power Corp. in Georgia, said the proposed EPA rule could affect the affordability of electricity for the generation and transmission cooperative’s 38 distribution co-op members, which serve some of the poorest counties in the state.

“When there is an increase in the cost of energy, we have nowhere else to turn to pay for that increase except our 38 co-ops, and they have nowhere else to turn except to pass that on to the rural families and businesses that are in their service territory,” she said. “We have a unique perspective in looking at this through the eyes of a cooperative.”

Erin Kelly is a staff writer at NRECA.

NRECA, Cobb EMC and three national laboratories have won global recognition for their work on microgrid control modeling software that can boost grid reliability by using distributed assets to mitigate power outages.

R&D World recently selected the PowerModelsONM tool for a 2023 R&D 100 award, a worldwide science competition judged by 45 industry professionals.

PowerModelsONM development was led by Los Alamos National Laboratory with contributions from NRECA, Cobb EMC in Marietta, Georgia, the National Renewable Energy Laboratory and Sandia National Laboratories.

The software helps distribution operators evaluate a grid’s resilience against extreme events and plan for recovery and restoration using every asset available—distribution automation, microgrids, and other distributed generators and controls.

“We appreciate the honor from R&D World and enjoyed collaborating with the national laboratories and Cobb EMC,” said David Pinney, NRECA principal for analytical tools and software products.

“We look forward to being a resource for co-ops that apply this tool to microgrids as they plan for challenges to a reliable grid.”

Cobb EMC provided a network model for a microgrid system where lab researchers could test the software. NRECA calculated the costs and benefits of the outage reduction, visualized the control action results, and integrated the tool with widely used cooperative grid-planning software.

“PowerModelsONM has the potential to be a very useful tool for any electric utility planning to develop single or networked microgrids integrating diverse distributed energy resources,” said Manish Murudkar, Cobb EMC’s director of DER strategy.

In a worst-case scenario such as the loss of a feeder, the PowerModelsONM system can help distribution operators call on all available DERs to restore power.

“This approach can significantly enhance the reliability of the system in various fault scenarios or line disturbances, ensuring that members receive a more dependable supply of electricity,” Murudkar said.

The project team conducted “hardware-in-the-loop” testing, which validated the software results against detailed grid models and real microgrid hardware.

“This allows engineers to thoroughly understand the performance of the inverters and the overall system prior to its deployment in the actual field environment,” Murudkar said.

“That will save utilities a significant amount of time and money because testing a microgrid is a challenging task. Simulation testing will simplify that challenging task.”

Cobb EMC began operating a microgrid in September 2022 at its headquarters. The system can function in both grid-connected and island modes. It comprises a 1.5-megawatt solar array, a 1-MW/4-megawatt-hour battery energy storage system, and a 1-MW natural gas generator.

“The award is really exciting news,” said Tim Jarrell, the co-op’s vice president of power supply rates and DER strategy. “We are thrilled about this award and the opportunity to work on such an innovative project.”

Cathy Cash is a staff writer for NRECA.

Americans face dangerous, economically disruptive power outages if the nation can’t overcome threats to reliable electricity, the CEO of a South Carolina electric cooperative warned a House panel Wednesday.

“Simply put, if we fail to act on these reliability challenges, we will struggle to keep up,” Bob Paulling, CEO of Lexington-based Mid-Carolina Electric Cooperative, told the House Energy and Commerce Subcommittee on Energy, Climate and Grid Security at a hearing on reliability.

“Blackouts will become a routine part of our lives, and jobs and industry will flee not only South Carolina, but the country.”

South Carolina faced rolling blackouts last December as unusually cold temperatures pushed the demand for electricity to record highs, straining power grids and leaving hundreds of thousands of consumers without heat, Paulling said.

“Fortunately for Mid-Carolina Electric members, there were no rolling blackouts at our co-op,” he said. “But we may not be so lucky the next time.”

Paulling reinforced NRECA’s message on the five biggest challenges threatening reliability: the increasing electrification of the economy; the disorderly retirement of power plants that run on fossil fuel; a permitting process that costs too much and takes too long; supply chain delays; and problems obtaining natural gas.

South Carolina has been a leader in helping to electrify the U.S. economy, bringing in a host of economic development projects tied to the production of electric vehicles, Paulling said.

“Those projects have brought thousands of high-paying jobs to our state, including to rural, economically depressed areas that have waited decades for this kind of opportunity,” he said. “But these plants also require large amounts of electricity, and we must be ready to serve them.”

South Carolina desperately needs more electricity and more options for producing it as the nation’s third-fastest-growing state works to meet the skyrocketing demand for power, Paulling said.

“In addition to building new power plants, we also need to preserve the existing generation fleet, no matter the fuel source, until adequate replacements and reserves are in place,” he said.

The permitting process for electric co-ops to obtain federal approval for infrastructure projects also must be streamlined, Paulling said.

“A good example of permitting issues unnecessarily prolonging needed improvements in South Carolina is Central Electric Power Cooperative’s attempts to upgrade overloaded infrastructure in the areas surrounding the town of McClellanville,” he said.

“Efforts by the local distribution cooperative and Central to build a needed new transmission line has stalled for nearly two decades in part due to the complicated federal regulatory process and the lack of required coordination and streamlining among federal agencies.”

The international supply chain delays that began during the COVID-19 pandemic are continuing to stall badly needed improvements at electric co-ops, he said.

“At Mid-Carolina Electric, we have been trying to build one single substation for over two years,” Paulling said. “We needed it to be energized this past summer to relieve another substation that is at maximum capacity. We are still waiting on the high-side breakers for that station, and the delivery dates keep changing. We hope to have it energized before the winter peak.”

The availability of natural gas for power plants has been threatened by extreme weather events such as the frigid temperatures across South Carolina last December, he said. More than a quarter of the state’s power comes from natural gas.

“The sick and the elderly cannot be made to endure days of intense South Carolina heat without air conditioning or nights of extreme cold without heating,” Paulling said. “As Winter Storm Uri in Texas taught us just two years ago, people will die if we can’t reliably deliver the electricity they need.”

Erin Kelly is a staff writer for NRECA.

After four major hurricanes in 15 years, Louisiana’s Jeff Davis Electric Cooperative is embarking on a project to relocate and harden some of the most vulnerable segments of its system thanks to a $350 million hazard mitigation grant from the Federal Emergency Management Agency.

“Laura was the worst storm we ever had,” said Mike Heinen, CEO of the Jennings-based distribution co-op, recalling the destruction caused by the Category 4 hurricane’s 150 mph winds in August 2020. “We lost everything, including 105 miles of 69-kilovolt line built on wooden poles and about 50 miles of a 138-kilovolt line built with H structures carrying our lines through marshland.”

Due to the COVID-19 pandemic, restoration work following Laura required a tent city twice the size traditionally needed to accommodate the 800 personnel involved. For more than 16 weeks after the storm made landfall, crews and contractors worked 16-hour days, seven days a week rebuilding the system and getting members and commercial-industrial accounts reconnected. Hurricane Delta disrupted their work when it struck the same area in October 2020.

The co-op spent the past three years working with local and state emergency management personnel to obtain the FEMA hazard mitigation grant. The funding covers about 90% of the costs of major improvements to 105 miles of JDEC’s transmission system and will allow the co-op to raise 10 of its substations at least one foot higher than the region’s 500-year floodplain.

FEMA awards hazard mitigation grants to some communities that are repeatedly impacted by weather events leading to federal disaster declarations. Jurisdictions seeking assistance can include essential infrastructure owners, like co-ops or other utilities, in their funding requests, enabling them to make improvements designed to reduce or avoid future losses.

In its grant application, JDEC cited cumulative costs exceeding $400 million caused by Laura and Delta as well as Hurricanes Rita in 2005 and Ike in 2008.

“Each time we rebuild our system, it’s that much more expensive,” said Heinen. “We’re actually trying to save money by building it stronger and more resilient.”

Once all service was restored in 2020 after Laura and Delta, the co-op still needed LNG-fueled generators to serve coastal areas of its service territory. Oil and gas processing, vital to the regional economy, relies on the co-op for electricity and is expected to need even more power in the future.

“The fuel trucks have been running 24/7 ever since Laura hit, and these projects will take nearly two years to complete, so we’ll have to keep the generators in place to serve C&I customers and provide power to our members,” said Heinen.

With state and federal approvals obtained, rights-of-way access secured and contracts in place to complete the hardening projects, Heinen expects work to get under way in early September. Under terms of the grant, all work must be completed before June 2025.

“We are building a looped 230-kilovolt system with steel poles for hardening and resiliency, and elevated substations to replace everything that was there before Laura hit,” he said. “The LNG plants and their planned expansion represent very large loads, so enhanced reliability and resiliency will improve their service and benefit co-op members in lower Cameron Parish and elsewhere on our system.”

The rebuilt grid is expected to produce wide-ranging benefits from national demand for oil and gas pumped through pipelines connected to facilities in the area, said Heinen.

“We’ll have a robust transmission grid with excess capacity supported by steel structures and elevated substations,” said Heinen. “We anticipate that when another storm or major hurricane comes through, our grid will survive it with minimal damage for the first time ever.”

Derrill Holly is a staff writer for NRECA.

Nearly 47,000 comments have been submitted to the Environmental Protection Agency by electric cooperative consumer-members as part of a grassroots campaign organized by Voices for Cooperative Power opposing the agency’s proposed power plant rule.

The strong response to the ongoing campaign by NRECA’s grassroots platform reflects the importance of the issue to co-ops and their members, said Patrick Ahearn, NRECA’s political affairs director.

“This is an issue that every co-op and consumer-member has a stake in, because it affects the reliability and affordability of their electricity,” he said.

The EPA’s proposed rule aims to essentially eliminate carbon dioxide emissions from power plants by 2035. NRECA leaders say it puts electric reliability at risk and will raise costs for consumers by setting unrealistic, unachievable goals that rely on still-developing technologies like carbon capture and storage and hydrogen as a fuel.

Co-op consumer-members, co-op employees and other advocates can click on a link or scan a QR code to learn more about EPA’s proposed rule and send a letter to the agency or share their opposition on Facebook.

The letter, addressed to EPA Administrator Michael Regan, concludes by saying, “I join with electric co-ops across the country in standing firmly against EPA’s proposal. It would undermine decades of work to reliably keep the lights on across the nation and could lead to life-threatening blackouts. These new regulations don’t work for my family, my community, or our nation’s economy.”

Ivy Prater, NRECA’s program manager for grassroots technology, said “it’s important that our side is being heard.”

“There’s always somebody on the other side who is out there advocating, so we want to make sure our co-op voices come through loud and clear,” she said.

A grassroots advocacy campaign is decidedly different when it’s focused on an agency rather than on elected officials who care what their local constituents and voters think, Ahearn said.

“But one of the things that the EPA looks at is the volume of comments they’re getting,” he said. “When you get into the tens of thousands of comments, it gets their attention.”

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement as the association filed comments in opposition to EPA’s proposed rule to further regulate power plant emissions. 

“EPA’s proposal is the wrong plan at a critical time for our nation’s energy future,” Matheson said. “It is unrealistic, unachievable, and will reduce key generating resources just as Americans are increasing their reliance on electricity. From deploying microgrids and renewables to launching demand response programs, electric cooperatives take an innovative and diverse approach as they work towards a responsible energy future. But expecting the industry to generate more electricity with fewer resources while adhering to unrealistic timelines is not a serious or practical approach.

“The energy future outlined by the EPA will result in more blackouts, higher costs, and greater uncertainty for Americans. And it will magnify today’s reliability challenges with grave consequences for an already stressed electric grid. When you find yourself in a hole, the first step is to stop digging. The EPA needs to put down their shovel.”

NRECA urged the agency to withdraw the proposal in its entirety and pointed out the following issues:

• The proposal hinges on the widespread adoption of nascent technologies:  clean hydrogen and carbon capture and storage. While both technologies are promising, they are not yet widespread or commercially available and have not been “adequately demonstrated” as required by the Clean Air Act.

• The proposal violates the Clean Air Act by giving the EPA vast new authority of major economic and political significance without a clear statement from Congress. This disregards the “major questions doctrine” and is inconsistent with the text, structure, and context of Clean Air Act Section 111.  

• The proposed rules contain timelines that are unrealistic and unachievable. The compliance deadlines endanger new and existing natural gas plants and all but ensure coal units will opt to shut down by 2035. The requisite infrastructure cannot be expected to be in place due to cost, supply chain challenges, permitting, public opposition, land ownership/access, and more.

• The proposed rules threaten reliability and affordability.

NRECA submitted written comments to EPA on Aug. 8 as part of the agency’s rulemaking process. The agency is expected to publish the final rule in the spring of 2024. 

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Cooperative Energy employees likely saw it coming for years: Increasingly longer idle periods that led to a shutdown in 2018 following the announcement of plans to decommission the R.D. Morrow Sr. Generating Station after 40 years of service.

“We had about 110 employees at Morrow for many of those years and still had 65 on the job when we committed to suspending coal operations,” said Jeff C. Bowman, president and CEO of the Hattiesburg, Mississippi-based generation and transmission cooperative.

Officials knew the surrounding communities needed those jobs, and the 448,000 members and businesses that depend on the co-op would still need reliable and affordable power.

“Cooperative Energy’s sole purpose is to serve our member cooperatives with affordable, reliable, and responsible energy, and we’re constantly looking for opportunities to improve,” said Mark Smith, the G&T’s senior vice president of power generation.

“Years of analyses concluded the best path forward was to repower our legacy coal plant into a 550-megawatt state-of-the-art combined cycle natural gas plant,” said Smith. “Plant Morrow is once again a symbol of affordable, reliable, and responsible generation for Mississippi and our members.”

Combined cycle technology uses waste heat from natural gas generation to make steam, which can increase overall electricity production by up to 50%.

At peak production, Morrow consumed about 1 million tons of coal per year and emitted around 3.5 million tons of carbon dioxide. The switch to natural gas is expected to reduce CO2 emissions by about 2 million tons per year compared to coal-based generation, said Trey Cannon, Cooperative Energy’s director of generation projects.

Morrow’s 400 megawatts of coal-based generation began serving southern Mississippi in 1978. When operations were suspended in 2018, workers turned their attention to environmental mitigation activities and dismantling dormant facilities at the more than 1,000-acre site.

“Our instrument and electrical group has done several major projects over the years, but the Morrow Repower Project was certainly the largest,” said Plant Morrow Instrument and Electrical Superintendent Larry Eaton.

In the demolition phase, co-op employees helped remove some 20 miles of cable and 500 conduit runs and dismantled and removed equipment that had not seen daylight outside the powerhouse since the 1970s. During construction, the team completed 47 work packages, following the same criteria as the contractors on-site, and played a key role in commissioning the unit.

“Retaining our existing workforce at the plant was of utmost importance. These men and women are the heart and soul of our operations,” said Smith. “They are committed, hardworking team members, and we wanted that same level of pride and dedication for the new Plant Morrow moving forward.”

Over the past four years, the co-op’s Morrow staff also completed about 19,000 hours of training to help them transition skills honed over years of coal-based operations to run the new plant— the largest training initiative ever undertaken by Cooperative Energy.

“The increase in employee confidence, knowledge and skill was immediately noticed with every hour of training completed and continues to prove invaluable with every megawatt produced,” said Hollis Douglas, the plant’s training coordinator.

Since commercial operations began in mid-March, the unit has run continuously, said Bowman. “If we are not the most efficient [generation] unit in the United States, we’re very close to the top.”

Bowman and other G&T officials stress that the success and savings achieved on the project stemmed from the commitments of their existing staff.

“The repower of our plant was a lifesaver for me,” said Shelby Lee, the plant’s mechanical maintenance foreman. “Every day we planned for what would be done tomorrow, next week or even next month.”

The G&T’s commitment to retain and retrain staff was reassuring to many who could not have easily commuted to any other G&T facility, particularly those with duties specific to coal-based generation.

“I just accepted the fact that I would have a career until the units were deemed unusable, and at that point, I would have to start over somewhere else with a different company to continue on to retirement,” said Lee, adding that the project has provided many employees with the confidence to make future plans.

“This was the best thing I could have hoped for,” said Lee. “We could all relax and continue to enjoy life without wondering each day if we were going to find out that our whole lives had to change because ‘daddy had to start a new job somewhere else.’”

Derrill Holly is a staff writer for NRECA.

For nearly a century, America’s electric grid has lived up to its reputation as a one of the world’s greatest technological marvels, capable of delivering power to millions of residents and businesses safely, affordably and—most important—reliably.

But lately, that reliability has been called into question, with new government regulations forcing the disorderly closure of always-on power plants in favor of renewables and demand exceeding supply during critical times in several regions of the country. What’s causing our grid to become more fragile and less reliable, and what have co-ops been doing to raise the alarm and offer solutions?

Hear from Jim Matheson, CEO of NRECA, and David Tudor, CEO of Associated Electric Cooperative, a large generation and transmission co-op in Missouri.

Listen to the episode below:

You can also listen and subscribe to Along Those Lines on your preferred podcast service:
Apple Podcasts | Google Podcasts | Stitcher | Spotify | YouTube

Related Content:

• NERC Summer Assessment Sounds Alarm on Grid Reliability Challenges
• Co-op Leader to Congress: ‘Rolling Blackouts Cannot Become New Normal’
• Matheson: EPA Power Plant Proposal Undermines Reliable, Affordable Power
• FERC Commissioners Warn of Threats to Reliable Electricity
• Video: NRECA CEO Jim Matheson Highlights Looming Reliability Challenges

Find out more about NRECA’s podcast. Questions or suggestions? Email us at AlongThoseLines@nreca.coop.

The Environmental Protection Agency’s proposed rule to regulate greenhouse gas emissions from coal and natural gas-fired power plants threatens electric cooperatives’ ability to provide reliable, affordable electricity to their members, an Ohio co-op leader told a House panel Tuesday.

Patrick O’Loughlin, president and CEO of Buckeye Power Inc. and Ohio Rural Electric Cooperatives, told the House Energy and Commerce Subcommittee on Environment, Manufacturing and Critical Materials that Buckeye Power and NRECA are reviewing the 500-page rule proposed by the EPA in May and have grave concerns.

“While this review is far from complete, it is clear that this proposal will further strain America’s electric grid and undermine our ability to keep the lights on at a cost our communities can afford,” he testified at a hearing on the EPA proposal.

Buckeye Power is a generation and transmission cooperative that provides power to 24 distribution co-ops in Ohio. The majority of the co-op’s power comes from coal, with additional power provided by natural gas, solar, hydropower, biomass and other small-scale renewable energy generation, O’Loughlin said.

Coal-fired plants and large natural gas-fired plants would generally be required under EPA’s proposed rule to begin operating significant emissions controls in 2030 to cut or capture nearly all their carbon dioxide emissions by 2038. Plants that can’t meet those standards would be forced to shut down.

“Buckeye Power will be required to shut down all of our coal-fired units by 2030 with no hope of nearly replacing this energy within that timeframe,” O’Loughlin said. “Similar unrealistic ‘green’ hydrogen co-firing and CCS (carbon capture and storage) requirements for new natural gas plants preclude using natural gas as a substitute for coal plants closed by this rule.”

It would cost Buckeye Power billions of dollars to replace its coal generation with renewable power, he said.

“To replace the energy output of just one 600-megawatt Cardinal unit would require more than 1,500 MW of solar—requiring at least 6,000 acres of land and an investment of at least $1.5 billion,” O’Loughlin said. “That is to replace just the energy output, and not the other reliability services our coal units provide, and certainly won’t help on the cold winter nights like we experienced this past Christmas.”

Some of the new technology that EPA is advocating—including carbon capture and hydrogen power—is still experimental, O’Loughlin said.

“Our company, and ultimately our members, can’t afford to implement full-scale science experiments at our power production facilities as EPA proposes we must or shut down by 2030,” he said.

In addition to detailing his major concerns with the proposed rule, O’Loughlin told lawmakers that the EPA should:

• Extend its comment period beyond July 24 to give those affected more time to review the long, complicated rule.
• Provide sufficient time for reliability assessments by the North American Electric Reliability Corp. and others.
• Hold an official small-business panel to assess the impact of the proposed rule on these businesses.

“Buckeye and America’s electric cooperatives look forward to working with you to ensure that actions to improve our nation’s environment are pursued in a way that also advances our mission of providing affordable and reliable power to the communities we serve,” O’Loughlin said.

Erin Kelly is a staff writer for NRECA.

Electric cooperatives will soon benefit from streamlined reviews of their infrastructure projects under the National Environmental Policy Act, thanks to changes in the law pushed by NRECA and approved by Congress as part of a bipartisan agreement to raise the nation’s debt limit.

In a major victory for electric co-ops, the process will now be expedited so that environmental impact statements must be done within two years and less intensive environmental assessments must be completed within a year.

Co-op leaders also will have new opportunities to engage directly with federal officials as part of the environmental review of their projects.

“As our nation increasingly relies on electricity to power more of the economy and threats to reliability mount, it is critical that we permit, build and maintain a robust electric grid,” said NRECA CEO Jim Matheson. “These permitting reforms are an important step forward that will help electric co-ops meet future energy needs while maintaining affordability and reliability.”

Co-ops must undergo NEPA reviews when they seek permits to build major new energy projects. In some cases, they also are required to go through the permitting process when they apply for Rural Utilities Service loans to expand, upgrade and modernize their systems or to remove vegetation that is threatening power lines on federal land.

In February, John Carr, vice president of strategic growth at Dairyland Power Cooperative in Wisconsin, told the House Natural Resources Committee that the federal environmental review process takes too long, costs too much and makes it more difficult for electric cooperatives to provide reliable, affordable power to their members.

“Dairyland and other electric co-ops support the appropriate consideration of potential environmental impacts of energy projects during the permitting process, but the existing process impedes our ability to deploy clean energy to meet the current and future needs of our consumers and communities,” Carr testified.

That message has been reinforced by other co-ops and NRECA leaders who have pressed Congress to take action on permitting reform. It was one of the main issues that co-op leaders brought to their lawmakers’ attention during NRECA’s Legislative Conference in April.

The reforms passed by Congress also mandate that if one agency develops a “categorical exclusion” from certain rules for a specific type of project, another agency can use that same exclusion. The changes also create an expedited permitting process for large energy storage projects.

The House approved the permitting reform provisions as part of the debt limit deal on May 31. The Senate approved the package on Thursday, and President Joe Biden signed it into law on Saturday.

Erin Kelly is a staff writer for NRECA.

Nearly half the U.S. Senate is asking the Department of Energy to avoid placing electricity supplies and national security at risk and halt its plan to require distribution transformers, already in short supply, to be made using less readily available amorphous steel.

“We urge the department to refrain from promulgating a final rule that will exacerbate transformer shortages at this strategically inopportune time,” a bipartisan group of 47 senators told Energy Secretary Jennifer Granholm in a June 1 letter.

“Such a standard could come at meaningful cost to grid reliability and national security, continuing the clean energy transition, and bolstering domestic supply chains and the workforce.”

The senators encouraged DOE instead to “convene stakeholders across the supply chain to develop [a] consensus-based approach to setting new standards.”

The department’s proposal, part of its draft Energy Conservation Standards for Distribution Transformers rule, is based on efficiency gains it says will be realized if transformers and other electrical components are made of lighter-weight but less-durable amorphous steel rather than traditional grain-oriented electrical steel (GOES).

There is currently only one domestic supplier of amorphous steel, which has a market share of less than 5%, a scenario the senators said would lead to further supply chain delays of up to two years.

“We believe the most prudent course of action is to let both GOES and amorphous steel cores coexist in the market as they do today, without government mandates, for new installations as we ramp up domestic production and reorient supply chains,” the senators wrote Granholm.

The senators also requested a briefing from DOE on its proposal and how the department might “bolster domestic supply chains and help alleviate the current and persisting supply chain challenges facing distribution transformers.”

NRECA praised the Senate effort, led by Sen. Bill Hagerty, R-Tenn., for underscoring to DOE the significant electric reliability risk of the proposed rule, which the association filed formal comments on in March.

“We sincerely appreciate Sen. Hagerty and the extensive list of bipartisan cosigners for raising concerns about DOE’s proposed distribution transformer rule and its effects on national security and grid reliability. We need to support, not hamper, the domestic supply chain of distribution transformers,” said Will Mitchell, NRECA legislative affairs director.

“We look forward to working with our colleagues, senators, representatives and DOE to ensure electric reliability and efficiency solutions.”

Cathy Cash is a staff writer for NRECA.

As threats to reliable electricity in America grow, NRECA CEO Jim Matheson sat down with Fox News’ Bret Baier on Thursday to discuss the issue. 

“What’s going on in this country right now is demand for electricity is growing, which is a good thing. The economy is growing, but we’re shutting down power plants, and we’re not replacing it with any capacity. So, at some point, that basic relationship starts to get in trouble,” Matheson said.  

As the demand for electricity grows and the available supply dwindles, Matheson says there’s a need for policymakers to stop making the problem worse. 

“When you find yourself in a hole, stop digging,” Matheson said. “We got to take the shovel away from the EPA.”

Watch the full conversation below:

The push to rapidly replace always-available energy sources could spark rolling blackouts across America, the leader of a Midwest generation and transmission cooperative warned a Senate panel Thursday.

“Lawmakers must support policies that include all energy sources to maintain reliability and affordability. Rolling blackouts cannot become the new normal,” David Tudor, CEO of Springfield, Missouri-based Associated Electric Cooperative Inc., told the Senate Energy and Natural Resources Committee at a hearing on electric system reliability.

“It is critical that policymakers recognize the need for adequate time, technology development and new transmission infrastructure before taking our nation down an energy path that prioritizes speed over successfully keeping the lights on.”

Tudor cited the North American Electric Reliability Corp.’s recent Summer Reliability Assessment, which warned that two-thirds of the U.S. could face energy shortfalls during periods of extreme heat this summer.

“Importantly, the 2023 NERC summer reliability assessment is just the latest in a series of alarming reminders about the new electric reliability challenges facing the nation,” Tudor said.

“Last month, Federal Energy Regulatory Commissioner Mark Christie warned this committee of threats to reliable electricity, stating ‘I think the United States is heading for a very catastrophic situation in terms of reliability.’”

Associated Electric Cooperative, which serves 935,000 meters across rural Missouri, northeast Oklahoma and southeast Iowa, was able to keep the lights on during severe winter storms the past two years that knocked out power to millions of Americans and led to the deaths of more than 700 people in Texas during Winter Storm Uri in February 2021.

“Associated relies on a balanced generation mix, with proven and reliable coal and natural gas generating plants as a valuable foundation for reliability and dispatched its units to full capacity in advance of the cold temperatures,” Tudor said, describing the co-op’s response to Winter Storm Uri.

“Despite significant outside pressure in recent years to move to other options, these fossil-fuel generating stations were the major factor in keeping the lights on for the 2.1 million people we serve. Hydropower allocated by the Southwestern Power Administration was a reliable energy source. Wind generation in Associated’s mix played a minor role.”

Last December, nine states experienced rolling blackouts as the demand for electricity exceeded supply during Winter Storm Elliott.

“Again, coal and natural gas generation carried the day, preserving reliability for Associated’s members when they needed power the most,” Tudor said.

He applauded the inclusion of some permitting reform provisions in the debt limit deal reached by President Joe Biden and House Speaker Kevin McCarthy, R-Calif. The House approved the deal Wednesday and the Senate approved it late Thursday.

NRECA has made permitting reform a top priority, as the lengthy and costly process for obtaining a federal environmental permit can derail crucial projects to improve service to co-op consumer-members.

“These reforms, including firm time limits for environmental reviews, greater applicant involvement in the process and more efficient reviews for recurring small projects we already know have minimal environmental impacts, will allow co-ops to build new generation and transmission infrastructure in a timely and cost-effective way,” Tudor said.

Erin Kelly is a staff writer for NRECA.

NRECA has joined with electrical unions, builders and utility groups in asking President Joe Biden to prioritize domestic steel production to help meet an unprecedented demand for electrification and grid modernization and resilience initiatives.

“We write to urge your administration to make it clear that electrical steel is critical to the national and economic security of the United States and to prioritize actions that will create a sustainable supply,” NRECA and eight other national organizations said in a May 22 letter to the president and copied to the secretaries of treasury, energy, commerce and labor.

“The limited availability of domestically manufactured electrical steel poses challenges to the widespread adoption of electric vehicles, delays timelines for utilities to restore power following natural disasters and is a contributing factor to an insufficient inventory of distribution transformers to meet the demand for new home and commercial construction,” the letter said.

The Department of Energy last year documented only one U.S. supplier of grain oriented electrical steel, and that “severely limits electrical manufacturers’ ability to source domestically and meet certain domestic content thresholds” set by the administration, the groups said. GOES and non-grain oriented electrical steel are essential components to electric motors, transformers, electric vehicle chargers, generators and other critical electrical equipment.

“Shortages of domestic electrical steel are contributing to significant and persistent supply chain challenges across our industries,” the groups told the president. “The federal government can guarantee purchase of GOES and NOES up to a defined amount, as needed by critical electrical industries, to serve a more electrified economy as well as incentivize expanded manufacturing capacity.”

The groups suggested Biden convene an Electrical Steel Summit with stakeholders, including electric utilities, electrical manufacturers, automakers, steel manufacturers, labor unions and homebuilders, to focus on the challenges to U.S. production and the supply chain crisis that threatens the economy and the administration’s electrification and decarbonization goals.

The White House also should recognize domestic electrical steel production as vital to its objectives in the Infrastructure Investment and Jobs Act and the Inflation Reduction Act and prioritize the “critical importance of electrical steel and growing domestic manufacturing jobs by working with Congress to put requisite financial resources toward shoring up domestic supply,” the organizations said.

“We urge your administration to make developing a sustainable supply of electrical steel in this country a top priority now and going forward.”

The Alliance for Automotive Innovation, American Public Power Association, Edison Electric Institute, GridWise Alliance, International Brotherhood of Electrical Workers, Leading Builders of America, National Association of Home Builders and National Electrical Manufacturers Association joined NRECA in signing the letter to Biden.

Earlier this year, NRECA called on DOE to address the urgency of GOES production for domestic distribution transformers rather than pursue efficiency standards supporting amorphous steel, a less durable material that is largely sourced overseas and could create reliability issues.

Cathy Cash is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement after the North American Electric Reliability Corporation’s (NERC) summer 2023 reliability assessment.

“This report is an especially dire warning that America’s ability to keep the lights on has been jeopardized,” Matheson said. “That’s unacceptable. The decisions we make today determine whether utilities across the nation have the resources to power the American economy tomorrow. Federal policies must recognize the compromised reliability reality facing the nation before it’s too late.

“American families and businesses expect the lights to stay on at a cost they can afford. But that’s no longer a guarantee. Nine states saw rolling blackouts last December as the demand for electricity exceeded available supply. And proposals like last week’s EPA power plant rule will greatly compound the problem. Absent a major shift in state and federal energy policy, this is the reality we will face for years to come. It’s vital that policymakers work to prioritize reliability in every energy policy discussion.”

Five issues are currently impacting the reliable delivery of electricity across the nation. They include:

• Increasing demand for electricity as other sectors of the economy are electrified.
• Decreasing electricity supply due to the disorderly retirement and insufficient replacement of existing generation.
• Permitting delays that prevent new electric infrastructure from being built and connected to the grid.
• Supply chain challenges.
• Problems with natural gas availability.

The 2023 NERC summer reliability assessment is just the latest in a series of alarming reminders about the new electric reliability challenges facing the nation:

• Federal Energy Regulatory Commission: Earlier this month, several FERC Commissioners warned the Senate of threats to reliable electricity. “I think the United States is heading for a very catastrophic situation in terms of reliability,” Commissioner Mark Christie said.

• PJM Interconnection: In March, PJM CEO Manu Asthana said that the regional transmission organization needed to slow the pace of generation retirements to avoid reliability problems by the end of the decade. “I think the math is pretty straightforward,” Asthana said.
  
  The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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NRECA CEO Jim Matheson said new regulations proposed by the Environmental Protection Agency (EPA) to eliminate greenhouse gas emissions from the power sector will place reliable and affordable electricity at risk and threaten America’s energy security.

“This proposal will further strain America’s electric grid and undermine decades of work to reliably keep the lights on across the nation,” Matheson said. “And it is just the latest instance of EPA failing to prioritize reliable electricity as a fundamental expectation of American consumers. We’re concerned the proposal could disrupt domestic energy security, force critical, always-available power plants into early retirement and make new natural gas plants exceedingly difficult to permit, site and build.

“Nine states experienced rolling blackouts last December as the demand for electricity exceeded the available supply. Those situations will become even more frequent if EPA continues to craft rules without any apparent consideration of impacts on electric grid reliability.”

EPA on May 11 released its long-anticipated draft rules aiming to cut carbon dioxide emissions by up to 617 million metric tons by 2042 at both new and existing coal and natural gas power plants.

Depending on the use of the unit, whether baseload or intermediate, the agency said power plants must adhere to performance standards following “best system of emission reduction” (BSER) requirements identified as: co-firing with natural gas, using clean hydrogen in place of natural gas and installing carbon capture and storage (CCS). For existing units, the states have some leeway in determining individual unit performance standards based on certain factors.

Existing coal-fired units planning to operate after 2039 will be required to install CCS with 90% effectiveness by 2030, according to the proposal. The BSER for coal units retiring before 2040 will depend on their shutdown date.

Existing natural gas plants of at least 300 megawatts and a capacity factor above 50% are expected to install 90% effective CCS by 2035 or co-fire with 30% low-carbon hydrogen beginning in 2032 and almost entirely hydrogen by 2038.

New natural gas plants are categorized based on how often they run. Those plants providing baseload power will have to meet the same CCS or hydrogen standards as large existing natural gas plants. Plants that are used intermittently will have to co-fire with 30% low-carbon hydrogen by 2032, while peaking units must meet low-emitting fuels requirements.

Matheson said EPA’s proposal fails to acknowledge the five top issues affecting the reliable delivery of electricity in the U.S.:

• Increasing demand for electricity as more sectors of the economy are electrified.
• Decreasing electricity supply due to the disorderly retirement and insufficient replacement of existing generation.
• Permitting delays that prevent new generation and transmission electric infrastructure from being built.
• Supply chain challenges.
• Challenges with natural gas availability.

“American families and businesses rightfully expect the lights to stay on at a price they can afford,” Matheson said. “EPA needs to recognize the impact this proposal will have on the future of reliable energy before it’s too late.”

NRECA will participate in the EPA’s public comments phase of the proposed rule, which will open 60 days after its publication in the Federal Register. EPA will also hold a virtual public hearing at a date to be determined.

Cathy Cash is a staff writer for NRECA.

Congress must modernize the federal permitting process to allow electric cooperatives to build new transmission and generation capacity more quickly and cost-effectively to meet growing demand for electricity, NRECA CEO Jim Matheson said in a letter to Senate leaders.

The Senate is working on crafting legislation to address permitting reform, and Matheson’s letter is the latest effort by NRECA to push for improvements that will benefit co-ops and their consumer-members.

“On behalf of America’s Electric Cooperatives, thank you for your efforts to streamline the federal infrastructure permitting process,” Matheson wrote in a May 8 letter to Senate Majority Leader Chuck Schumer, D-N.Y., and Senate Minority Leader Mitch McConnell, R-Ky.

“As we strive to meet our consumer-members’ expectations in the coming years, while maintaining reliable and affordable electric service, electric cooperatives will need to build significant amounts of new electric transmission and generation capacity of all types.”

Many of those projects will require permits and environmental reviews from federal, state and local governments, he said. Major projects will need to complete an environmental impact statement under the requirements of the National Environmental Policy Act.

“Unfortunately, as just one indicator of the headwinds we currently face, it takes an average of 4.5 years to complete an EIS and issue a permitting decision,” Matheson said. “One quarter of EISs take more than 6 years.”

He urged senators to consider five key principles as they conduct hearings and draft legislation to improve the permitting process:

• Time limits of no more than two years for environmental reviews. “That should be enough time to conduct a rigorous review while providing project certainty.”

• Greater applicant involvement in the process. Member-owned co-ops “know the specific details of their projects and the unique needs and challenges facing their communities.”

• More efficient reviews for recurring small projects—such as trimming trees to prevent power outages and wildfires—that are known to have minimal environmental impacts. “Electric co-ops should not have to navigate a lengthy, bureaucratic process for actions where both co-ops and the agency already know the benefits are high and the impacts are low.”

• Limit lengthy, costly litigation that can delay projects indefinitely. “Litigation can result in excessive paperwork and unnecessary delays—holding up projects that communities badly need.”

• Ensure that transmission permitting and siting improvements reflect co-op and community needs. “The electric grid needs more electric grid transmission capacity to meet expected growth in the coming decades.”

Matheson said policies to spur additional capacity must not expand the Federal Energy Regulatory Commission’s authority over electric co-ops. He added that those policies must allocate the costs only to those who receive tangible and quantifiable benefits and “must ultimately serve the national interest of maintaining the reliability and affordability of the electric grid.”

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement in response to EPA’s latest proposed rule to regulate power plant emissions.

“This proposal will further strain America’s electric grid and undermine decades of work to reliably keep the lights on across the nation,” Matheson said. “And it is just the latest instance of EPA failing to prioritize reliable electricity as a fundamental expectation of American consumers. We’re concerned the proposal could disrupt domestic energy security, force critical always available power plants into early retirement, and make new natural gas plants exceedingly difficult to permit, site, and build.

“Nine states experienced rolling blackouts last December as the demand for electricity exceeded the available supply. Those situations will become even more frequent if EPA continues to craft rules without any apparent consideration of impacts on electric grid reliability. American families and businesses rightfully expect the lights to stay on at a price they can afford. EPA needs to recognize the impact this proposal will have on the future of reliable energy before it’s too late.”  

Five issues are currently impacting the reliable delivery of electricity across the nation. They include:

• Increasing demand for electricity as other sectors of the economy are electrified.
• Decreasing electricity supply due to the disorderly retirement and insufficient replacement of existing generation.
• Permitting delays that prevent new electric infrastructure from being built and connected to the grid.
• Supply chain challenges.
• Problems with natural gas availability.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

-###-

The nation is facing unprecedented challenges to the reliability of the electric power system, members of the Federal Energy Regulatory Commission warned at a recent Senate hearing.

Commissioner Mark Christie, echoing concerns expressed to Congress by NRECA, said the transition to cleaner energy is happening too fast and could have disastrous consequences. NRECA has been repeatedly pushing that same message to lawmakers and federal agencies for more than a year.

“I think the United States is heading for a very catastrophic situation in terms of reliability,” Christie told members of the Senate Energy and Natural Resources Committee at a May 4 oversight hearing focused on FERC.

“The core of the problem is actually very simple. We are retiring dispatchable generating resources at a pace and in an amount that is far too fast and far too great and is threatening our ability to keep the lights on.”

In March 2022, NRECA CEO Jim Matheson warned the Senate Environment and Public Works Committee of the risks of energy shortfalls during extreme weather if too much baseload generation is retired prematurely.

“Such policies would have significant impacts on the reliability and security of the electric grid and could have an undue economic impact on co-op consumer-members, particularly as additional costs must be incurred for replacement generation,” Matheson said.

Christie said the problem is not the addition of wind, solar and other renewable resources to the energy mix.

“The problem is the subtraction of dispatchable resources such as coal and gas,” he said, underscoring NRECA’s message to policymakers.

All four of the commissioners who testified before the Senate committee agreed that coal is still necessary to maintain reliability.

“Do any of you believe that it’s possible to eliminate coal today or in the near future and still be able to maintain a somewhat reliable system?” asked Chairman Joe Manchin, D-W.Va.

“I believe in an all-of-the-above approach,” replied FERC Chairman Willie Phillips, who was appointed to lead the commission in January by President Joe Biden. “Whatever resources are needed to keep our grid reliable, we have to make sure they are available.”

Commissioner James Danly said, “as things stand, coal is required.”

“It makes up just under a quarter of all the installed capacity in America and it would be impossible, given the locations and the realities of the electricity system, to replace it,” Danly said.

Phillips said the grid is also being threatened by “foreign and domestic actors” who are “testing our cyber defenses every day.”

“Physical threats to the grid are on the rise,” he said. “And extreme weather of all kinds is threatening the power to our customers.”

Phillips emphasized that “reliability is, and must be always, job No. 1.”

Since the beginning of the year, he said, the commission has taken several actions to strengthen reliability:

• Finalizing a rule to require the North American Electric Reliability Corp. to develop enhanced cybersecurity standards for internal network security protocols.
• Directing additional enhancements to a series of winter preparedness measures filed by NERC that are designed to prevent a repeat of the massive power outages and grid failures that took place during Winter Storm Uri in Texas two years ago.
• Approving a new reliability standard to further protect the electric system supply chain from hostile actors.
• Issuing a final rule in April to create a system of incentives to reward certain cybersecurity investments.

Erin Kelly is a staff writer for NRECA.

Douglas Electric Cooperative in Oregon has been awarded a $9.1 million grant by the U.S. Forest Service to remove trees at risk of falling on power lines and sparking wildfires that threaten homes and businesses.

The number of dead and damaged trees that need to be removed has skyrocketed in recent years after severe storms in Oregon and drought throughout the West, said General Manager Keith Brooks.

“It’s a tinderbox filled with 200-foot trees lined up next to our right of way,” he said. “Just one wrong tree coming down and hitting our lines could spark a wildfire fueled by all those weakened trees.”

The funds will enable the Roseburg-based co-op to double its right-of-way crews from four to eight and complete its vegetation management cycle in three to four years instead of every five to six years, Brooks said. The co-op serves more than 10,000 members in a 2,300-square-mile territory of mountains and forest land.

The grant also will allow Douglas EC to remove dangerous trees from beyond its own rights of way. That includes private land owned by co-op members and federal land managed by the Forest Service and the Bureau of Land Management.

“The trees beyond our right of way are becoming more and more of a problem,” Brooks said. “For every 100 tree-related outages we’ve had, we saw that 95% percent were outside of our traditional right of way. We keep our right of way maintained well, but we’ve had to expand our focus.”

Without the federal grant, the co-op would have had to raise rates for members to pay for its expanded wildfire mitigation efforts, Brooks said.

“This grant has been a blessing for us because we were already stressing our tree budget,” he said. “This is a way to help tackle the problem without dramatic rate increases for our membership.”

The grants will complement the co-op’s already extensive fire management plan, which includes equipping each line crew with a 500-gallon firefighting wagon, new fire extinguishers and water cans to help suppress flames until firefighters arrive. The crews take this equipment with them everywhere during fire season, which is getting longer and longer because of climate change, Brooks said.

“It’s happening,” he said. “There’s absolute evidence that things are drier. There’s less rain falling from the sky and more trees competing for less resources, making them more susceptible to insects and disease. We’re trying to de-escalate the threat.”

The co-op’s territory was largely spared by the devastating wildfires that roared to their east, north and south in the fall of 2020, killing 11 people, destroying small towns and burning more than a million acres.

No wildfires started in Douglas Electric Cooperative’s territory that year, but there were a few that spread a short ways into its service area from other places, Brooks said. The co-op only had to shut down one line briefly, affecting about 100 members.

“We’re in a little bit of a bubble where we don’t get winds as high as they do in other areas,” he said. “But we have been surrounded by fire outside our territory. And our day will likely come. We’re doing what we can to stave that off.”

Erin Kelly is a staff writer for NRECA.

Electric cooperative supply chain concerns were a primary topic of discussion at a Senate Energy and Natural Resources Committee hearing last week on the Department of Energy’s 2024 budget. 

The hearing occurred on the heels of NRECA’s Legislative Conference, where over 2,000 co-op leaders advocated for the importance of electric reliability, including the significant impact of supply chain bottlenecks.  

During the hearing, a bipartisan group of four senators recognized electric co-op efforts to address supply chain shortfalls and pressed Energy Secretary Jennifer Granholm on how the agency plans to help. 

“Each of these senators noted they’d heard about this issue from rural electric cooperatives,” said NRECA CEO Jim Matheson. “This is a fantastic example of the power of the cooperative network.”

See what these senators had to say in the video below:

Electric cooperatives will soon have access to $9.7 billion in grants and loans to buy or build new clean energy systems, Rural Utilities Service Administrator Andy Berke told co-op leaders Monday at NRECA’s Legislative Conference.

Berke said the U.S. Department of Agriculture is poised to roll out the program in the coming days. It was approved last August when Congress passed the sweeping Inflation Reduction Act.

“This is huge,” Berke told 2,000-plus conference attendees. “We have to make sure that you can make the energy transition that is coming without breaking the bank.”

The voluntary program will provide funding for a wide range of projects, including renewable energy, carbon capture, battery energy storage systems, nuclear power and improvements to generation and transmission efficiency. Interested co-ops will be eligible to receive an award for up to 25% of their project costs, with a maximum of $970 million going to any one co-op.

“This is an enormous opportunity,” he said. “We don’t know when it is going to happen again. Please take this opportunity. It’s available because of your advocacy.”

Berke drew applause when he announced that RUS, beginning this week, is shrinking the size of environmental review paperwork that co-ops have to fill out when they apply for loans from a minimum of 70 pages down to just four pages.

He said he listened to concerns about the process from co-op leaders at NRECA’s PowerXchange in Nashville, Tennessee, in March and made the change based on their feedback. He said he hopes it will expedite co-op construction projects.

“We know that a project today is better—and more importantly cheaper—than a project tomorrow,” Berke said.

Sen. Boozman Honored With Distinguished Service Award

Also on Monday, Sen. John Boozman, R-Ark., received NRECA’s Distinguished Service Award, which honors members of Congress who make essential contributions to electric co-ops and the communities they serve.

“Sen. John Boozman, an electric cooperative member, has been a friend to the Electric Cooperatives of Arkansas throughout his years in public service,” said Buddy Hasten, president and CEO of the Electric Cooperatives of Arkansas. “Sen. Boozman’s dedication as an advocate for Arkansans clearly aligns with the mission of our state’s electric cooperatives.”

Boozman, the ranking member of the Senate Agriculture, Nutrition and Forestry Committee, said he is hopeful that Congress will be able to pass one of NRECA’s top legislative priorities this year: a new five-year Farm Bill that includes full funding for rural economic development and broadband programs. The current Farm Bill expires Oct. 1.

“Farm Bills aren’t about Democrats or Republicans,” he said. “They’re bipartisan. I think we’ve got a great chance of getting it done.”

DOE Official: ‘Reliability Is the Foundation’

Gene Rodrigues, assistant secretary of energy for electricity, said he shares NRECA’s goal of ensuring that the electric grid “remains reliable, resilient and affordable for all Americans.” The importance of grid reliability is the main message that co-op leaders are taking to Capitol Hill and federal agencies this week.

“We are all in agreement with every single one of you in this room that reliability is the foundation of everything we want to do,” he said.

Unfortunately, the American people and many of their elected officials “take it for granted” that the lights will always come on when they flip the switch, Rodrigues said.

“That’s a problem,” he said, urging co-op leaders to “advocate, educate and collaborate” to sound the alarm about the potential risks to reliability.

“If it’s taken for granted, then we won’t have the champions we need to keep electricity reliable and affordable over time. … Make sure they understand the absolute necessity of investing in a 21^st century power grid for the American people.”

Spanberger Lauds Co-op Role in Closing Digital Divide

“Rural communities feed and fuel the rest of Virginia and our nation,” Rep. Abigail Spanberger, D-Va., told conference participants. “Unfortunately, at times it seems like rural America can get left out of the conversations on infrastructure and economic development.”

She said that electric co-ops serve 40% of her constituents and are helping to bring essential broadband service to rural communities that for-profit internet providers ignore.

“I’m so grateful to your [NRECA] members for working to bring broadband,” Spanberger said.

The bipartisan infrastructure law’s $65 billion in broadband funding will help close the digital divide and “strengthen our rural economy for the next generation of Americans,” she said.

Freshman House Members Push for Bipartisan Solutions

Freshman Reps. Juan Ciscomani, R-Ariz., and Don Davis, D-N.C., were both elected in 2022 and represent electric cooperative members in rural communities. They told co-op leaders that they are frustrated by the fierce partisan divide in Congress and hope to work together as members of the bipartisan Problem Solvers Caucus.

“There’s too much extremism, and it comes from both sides—let’s be honest about it,” Davis said.

Ciscomani, who described his district’s voters as one-third Republican, one-third Democratic and one-third independent, said he has set up an advisory committee back home made up of local leaders with diverse political ideologies.

“There is an appetite in our country for people to work together to find solutions,” he said.

Erin Kelly is a staff writer for NRECA.

More Coverage From Legislative Conference:

What Electric Co-ops Need From Policymakers to Close the Digital Divide
NRECA CEO: Reliable Electricity Is Main Focus of Legislative Conference
Rep. Bob Latta: Rural Connectivity ‘Is Everybody’s Issue’

More than 2,000 electric cooperative leaders are gathering in Washington D.C., for NRECA’s Legislative Conference, and they will urge Congress and federal agencies to focus on maintaining reliable electricity for the American people, NRECA CEO Jim Matheson said at a media teleconference Thursday.

“Affordable and reliable electricity is an issue of growing concern among members of NRECA,” Matheson told reporters ahead of the April 16-19 conference.

“American families and businesses expect the lights to come on whenever they flip the switch, and we’re concerned that the reliability of the grid is at great risk.”

He pointed to rolling blackouts that took place in nine states last December as evidence of “a stressed grid.”

Electric co-op leaders will discuss five major issues that impact reliability with policymakers. They include:

• Growing demand for electricity as other sectors of the economy are electrified.
• Decreasing electricity supply due to the retirement and insufficient replacement of existing generation.
• Supply chain challenges.
• Permitting delays that prevent new electric infrastructure from being built.
• Problems with natural gas availability.

Recent reports by the North American Electric Reliability Corp. underscore the risks to electric reliability, Matheson said. NERC warned last year that the U.S. is experiencing a “disorderly retirement” of older electric generating plants without replacement power coming online fast enough to meet growing demand. NERC’s 2023 summer reliability risk assessment is due out soon.

“Demand is going up and supply is going down, and that’s not a good trend if you want to maintain system reliability,” Matheson said.

In addition to advocating for reliability issues, co-op leaders will push for robust funding for rural broadband and rural development in the new five-year Farm Bill that Congress is considering.

The bill is likely to include funding for the Department of Agriculture’s ReConnect Program, which provides loans and grants to electric co-ops and other groups to provide high-speed internet service to rural communities.

Erin Kelly is a staff writer for NRECA.

More Coverage From Legislative Conference:

Top Policymakers Address Electric Co-op Leaders at NRECA’s Legislative Conference
What Electric Co-ops Need From Policymakers to Close the Digital Divide
Rep. Bob Latta: Rural Connectivity ‘Is Everybody’s Issue’

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today applauded House passage of major energy legislation (H.R. 1), which includes critical permitting modernization provisions supported by electric cooperatives.

The bill includes the BUILDER Act (H.R. 2515) which would expedite environmental reviews under the National Environmental Policy Act (NEPA) and other federal processes.

“As threats to electric reliability mount and our nation increasingly relies on electricity to power more of the economy, it is critical that Congress streamline the process to permit, build and maintain the infrastructure that keeps the lights on across the country,” said Matheson. “Unless these obstacles are addressed, it will continue to be difficult to meet future energy needs while maintaining affordability and reliability.

“This legislation is a meaningful step forward as we work to maintain, improve and expand critical electric infrastructure.”

The BUILDER Act places targeted and reasonable limits on the environmental review of proposed major federal actions under NEPA. It establishes deadlines and other requirements to expedite the environmental review of such actions.

Co-ops must undergo NEPA reviews when they seek permits to build new energy projects and when they want to remove vegetation that is threatening power lines on federal land. They also are required to go through the NEPA process when receiving project funding and financing from the U.S. Department of Agriculture’s (USDA) Rural Utilities Service to expand, upgrade and modernize their systems.

Brent Ridge, CEO of Wisconsin-based Dairyland Power Cooperative, echoed Matheson’s strong support for the BUILDER Act, noting that the federal environmental review process takes too long, costs too much and makes it more difficult for co-ops to provide reliable, affordable power to their members.

“Dairyland strongly supports H.R. 1 and appreciates Congress’ effort to provide a pathway for more coordinated, consistent, and timely agency decision-making,” said Ridge. “It’s critical that we place reasonable parameters around the review process and limit unnecessary litigation. Simply put, NEPA modernization is necessary to advance future clean energy projects that will strengthen our economy and benefit the environment.”

Dairyland is a partner in the Cardinal-Hickory Creek transmission line that will deliver wind energy from the upper Great Plains to the Midwest in southern Wisconsin. The project was approved by federal agencies in winter 2020 but has been significantly delayed with costly litigation by environmental groups challenging the decision. It would deliver enough electricity from over 100 renewable energy projects to power millions of homes—but only if it can be built.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Electricity gets more essential to modern living every day, but electric cooperative executives are warning that without thoughtful policy decisions, future reliability challenges loom.

Demand for electricity is increasing for transportation, digital communications and other sectors of the economy while reliable baseload generation plants are being retired, NRECA CEO Jim Matheson said in a March 7 media teleconference in Nashville, Tennessee, as co-op leaders gathered for PowerXchange, NRECA’s annual meeting of members.

“We’re either replacing plants with less capacity, no capacity, or replacing them with renewables that are intermittent and not always available,” Matheson said.

Matheson, joined by representatives of distribution co-ops and generation and transmission co-ops, expressed broad concerns for consumers and businesses that rely on uninterrupted and affordable electricity.

“We are seeing capacity constraints across the board while we are in a rapid generation transition in our country,’’ said Chris Jones, CEO of Middle Tennessee Electric Membership Corp., a Murfreesboro-based distribution co-op that serves about 335,000 meters. “The meat and potatoes of our industry will remain affordability and reliability.”

Maintaining that reliability at costs consumers can afford is becoming increasingly challenging as the materials needed to meet production demands for essential components like transformers are diverted for electric vehicles and other new products. Co-ops are also among the utility interests urging federal regulators to consider near-term reliability before implementing standards that could exacerbate shortages of essential components.

“We’re shipping transformers out of stock faster than we can restock,” said Buddy Hasten, CEO of Arkansas Electric Cooperatives Inc. The Little Rock-based statewide cooperative association operates ERMCO, the nation’s leading supplier of transformers for electric cooperatives.

“We’re seeing a two-year lead time on orders for our most common transformers,” said Hasten, adding that before COVID-19-related disruptions, lead times of six to 13 months for large orders were common. “It can take two to three years to deliver large units” needed for substations and large industrial applications, he said.

Co-ops are industry leaders in developing renewable energy projects and research aimed at preserving existing generation resources while reducing their environmental impact. But there is growing concern that the early closure of existing generating assets could lead to shortages and disruptions rivaling those caused by extreme weather events.

“It has to be at a pace that makes sense,” said Suzanne Lane, CEO of Kansas Electric Power Cooperative, a G&T headquartered in Topeka. “Our members are very concerned about reliability.”

Co-ops leaders are also advocating for Congress to streamline the permitting process, as it currently can take a decade or longer under the National Environmental Policy Act process to obtain approvals to fully commission new generation or connect new sources to the transmission grid.

“Two years ought to be enough time to complete any review for siting,” said Matheson, adding that NRECA member co-ops are poised to take advantage of dozens of new federal programs designed to expand energy production or strengthen grid assets. One of those programs is a nearly $10 billion U.S. Department of Agriculture initiative to lower carbon emissions.

In addition to generation and transmission and supply chain issues, co-ops are also tackling cybersecurity and physical infrastructure threats aimed at portions of the grid under direct co-op control. That includes nearly 3 million miles of distribution lines and about 17,000 substations.

“Every utility in America is going through that right now,” Matheson said.

Derrill Holly is a staff writer for NRECA.

The federal environmental review process takes too long, costs too much and makes it more difficult for electric cooperatives to provide reliable, affordable power to their members, a Dairyland Power Cooperative leader told a House committee Tuesday.

“Electric cooperatives like Dairyland play a leading role in the ongoing transformation of the electric sector and often need to obtain permits or other authorizations from federal agencies to construct and maintain electric generation, transmission and distribution infrastructure,” John Carr, vice president of strategic growth at the Wisconsin-based generation and transmission co-op, told members of the House Natural Resources Committee.

“Dairyland and other electric co-ops support the appropriate consideration of potential environmental impacts of energy projects during the permitting process, but the existing process impedes our ability to deploy clean energy to meet the current and future needs of our consumers and communities. We simply must reform the process to enable the transition that is already underway and to ensure it can be done reliably and affordably for our customers.”

Co-ops must undergo National Environment Policy Act reviews when they seek permits to build new energy projects and when they want to remove vegetation that is threatening power lines on federal land. They also are required to go through the permitting process when they apply for Rural Utilities Service loans to expand, upgrade and modernize their systems.

“As Dairyland Power has experienced firsthand, lengthy NEPA reviews and litigation delay the completion of critical infrastructure projects, require significantly more time and resources, and have a direct negative impact on communities served by these projects,” Carr said.

The co-op’s efforts to build a transmission line that would cross a federal wildlife refuge to deliver wind energy from the upper Great Plains to southern Wisconsin has been delayed for more than three years because of litigation. It was approved by federal agencies in January 2020 but has been tied up in court by environmental groups challenging the decision.

“There are currently over 100 renewable generation projects depending upon the construction of the Cardinal-Hickory Creek transmission line,” Carr said. “These projects will generate enough electricity to power millions of homes with clean energy. But only if the line can be completed.”

He recommended four priorities for lawmakers as they look to reform permitting processes:

• Establish firm parameters for environmental reviews, including how long the reviews should take.
• Promote greater involvement by co-ops and other permit applicants in the process while still giving federal agencies the final word.
• Ensure faster, more efficient reviews for projects that clearly have minimal environmental impact.
• Limit unnecessary litigation of NEPA reviews. Put time limits on how long someone can wait before filing a lawsuit against a federal agency after the agency grants a permit.

Carr called on lawmakers to support the BUILDER Act, which contains many of those recommendations. The bill’s chief sponsor is Rep. Garret Graves, R-La.

“Meeting current and future energy needs is a major challenge,” he said. “Rising to meet this challenge will require collaboration, creativity and flexibility. Dairyland and our electric co-op brethren are ready to work with all of you and your colleagues in Congress and your federal agency partners to meet these needs.”

Erin Kelly is a staff writer for NRECA.

Electric cooperative leaders urged Congress to pass federal permitting reform legislation, warning that delays in approving projects to modernize electric power systems could threaten grid reliability.

“We’re looking at a significant electrification of the U.S. economy in transportation and other sectors,” NRECA CEO Jim Matheson told reporters Thursday at a media teleconference. “Is our electric infrastructure ready for that?”

To build or upgrade generation, transmission and distribution systems, co-ops must seek permits from federal agencies under the National Environmental Policy Act. But those approvals can take years to obtain and are often further delayed when groups sue the agencies that issue the permits, Matheson said.

“Everyone, even organizations that don’t always agree on a lot, recognizes the need for a more timely and predictable process in this transition to a much more electrified economy,” he said.

Matt Hanson, CEO of 4,600-member McKenzie Electric Cooperative in Watford City, North Dakota, said his co-op has had trouble bringing electricity to tribal members on the Fort Berthold Reservation because of lengthy delays getting permits from the Bureau of Indian Affairs.

“It prevents economic development on the reservation,” he said. “And it impacts the environment. Our consumers there are running their power off generators until we can connect them to lines. It costs 30% to 50% more to connect homes on BIA-governed land.”

Brent Ridge, president and CEO of Dairyland Power Cooperative in Wisconsin, said the delays in federal permitting are making it tougher for the large generation and transmission co-op to reduce carbon dioxide emissions as quickly as it would like. The co-op’s goal is to use 40% renewable power by 2035.

Two separate energy projects—one to deliver wind power and another to build a natural-gas plant that would reduce the use of coal—have been stalled by litigation and other permitting delays, Ridge said.

“If we are to lower carbon emissions as quickly as possible, we need a process that is efficient and nimble,” he said. “The current process is delaying progress and raising costs.”

Ridge, Hanson and Matheson all urged Congress to support the BUILDER Act. The legislation, sponsored by Rep. Garret Graves, R-La., would limit how long various environmental reviews must take, encourage greater involvement by co-ops and other permit applicants in the process and create deadlines for filing lawsuits after permits have been granted.

Matheson said he thought it was encouraging that the House Natural Resources Committee was focusing on the legislation at a Feb. 28 hearing, which includes testimony from Dairyland Power Vice President of Strategic Growth John Carr.

“I think the bill is a good first step,” he said. “I hope there’s a full-fledged bipartisan discussion in Congress. NRECA would certainly support that. We hope to build some momentum going forward.”

Erin Kelly is a staff writer for NRECA.

The U.S. Department of Agriculture recently announced $2.7 billion in loans for rural electric cooperatives and utilities to expand and modernize their electric infrastructure and increase grid security.

The latest round of Electric Loan Program funds will go toward 64 projects benefiting nearly 2 million people in 26 states.

“This funding will help rural cooperatives and utilities invest in changes that make our energy more efficient, more reliable and more affordable,” said Agriculture Secretary Tom Vilsack. “Investing in infrastructure—roads, bridges, broadband and energy—supports good-paying jobs and keeps the United States poised to lead the global economy.”

The loans include $613 million for installing and updating smart grid technologies, and nearly half of the awards will help finance improvements in underserved communities.

One of the largest awards will go to Withlacoochee River Electric Cooperative, which serves a high-poverty but fast-growing five-county area near Tampa, Florida. The Dade City-based co-op will use its $212 million loan to build and improve 580 miles of transmission line.

About $32 million will be used for substation and transmission projects, and another $17 million will strengthen smart grid technologies, the co-op said. The largest portion, $58 million, will go toward new underground electric infrastructure to serve new residential subdivisions.

Last year, the co-op added 9,000 new accounts, and it expects to exceed that this year, said David Lambert, WREC’s manager of member relations.

“We’re growing substantially,” he said. “These new loan funds will be used for system expansions in those areas.”

Other sizable co-op loans include:

• Clark Energy Co-op, Winchester, Kentucky: $26 million to build and improve more than 250 miles of power line in 12 central Kentucky counties. The loan also includes about $500,000 for smart grid technologies.
• Marshall County REMC, Plymouth, Indiana: $10 million to build and improve 75 miles of line in six counties in northern Indiana and nearly $1 million for smart grid technologies.
• Rusk County Electric Cooperative, Henderson, Texas: $24.6 million to connect an estimated 2,000 new members and build and improve 91 miles of line in five counties spanning 4,000 square miles. Projects include voltage conversion upgrades, a new transmission feed and substation construction. The loan also includes about $1.4 million for smart grid technologies.

View the full list of recipients and projects.

Victoria A. Rocha is a staff writer for NRECA.

When Winter Storm Uri hit Texas in February 2021 and historic electricity demand sent wholesale power prices above $9,000 per megawatt-hour, NEC Co-op Energy was among the retail electric providers in the state that managed to keep power flowing and member prices steady through the crisis.

Varzavand “Avan” Irani, CEO of Nueces Electric Cooperative, which runs NEC Co-op Energy, credits that to a 20-year commitment to reliability and the work of their generation and transmission co-op, South Texas Electric Cooperative.

“Our board has always prioritized the long-term reliability of our members’ power supply needs over short-term gains. With this clear directive in mind, we took early steps to limit our exposure to volatile retail electric pricing through investments in diverse sources of power and long-term power purchase agreements,” Irani said. “South Texas Electric Cooperative, our generation partners, have been extremely responsive to this approach and have played a vital role in the success of NEC Co-op Energy.”

During Uri, it was STEC’s broad portfolio of generation assets, including lignite, natural gas, wind, solar and hydro, that helped keep power flowing and prices in check for NEC Co-op Energy customers.

“STEC’s investments allow us to protect our members from major impacts to their electric bills during events like Winter Storm Uri,” said Frank Wilson, Nueces EC’s chief retail officer.

“STEC’s facilities were winterized, and precautionary measures were taken beforehand. Their plants continued generating throughout and minimized our exposure to high market prices.”

Nueces EC is unique among U.S. distribution cooperatives, managing a retail energy marketing company that serves members hundreds of miles outside its own territory. It created NEC Co-op Energy in 2002 in response to state legislation passed in 1999 that allowed ratepayers to choose their own power provider.

In most states, cooperatives and municipal utilities are exempt from retail choice. In Texas, retail choice is mandatory for utilities that operate within the footprint of the Electric Reliability Council of Texas, which covers most of the state, but co-ops and municipal utilities can opt out of participation in such programs.

“NEC’s retail choice program is yet another example of electric cooperatives listening to their members and providing them with solutions that meet their needs,” said Venkat Banunarayanan, NRECA’s vice president of Business & Technology Strategies for integrated grid services. “The retail choice program offered by NEC is innovative and brings the advantages of a trustworthy and credible cooperative utility partner for the supply of electricity to retail consumers across the state of Texas.”

Those who sign up for NEC Co-op Energy become members, and the co-op procures electricity on their behalf through ERCOT and delivers it through the local power line provider.

“With access to surplus, low-cost coal-fired generation, NEC Co-op Energy was competitively positioned to enter the market and successfully compete against higher-cost natural gas-supplied providers,” said Wilson.

In 2002, Nueces EC served about 12,000 meters, but an agreement with an investor-owned utility to resolve territorial issues added about 5,000 former IOU accounts to the co-ops’ rolls. It also gave NEC Co-op Energy access to market its services for retail choice and allowed the co-op to pursue sales in areas served by IOUs.

Participation has continued at a relatively steady pace, with overall annual growth of about 2%. Over the years, NEC Co-op Energy has gained new IOU members across the state, including several thousand in Dallas/Fort Worth, Houston, Corpus Christi and south Texas.

NEC Co-op Energy’s growth is attributed to a robust marketing campaign and members’ recommendations based on customer care, said Wilson.

“NEC Co-op Energy is consistently recognized as one of the top retail electric providers, with very high American Consumer Satisfaction Index scores,” Wilson said.

The co-op also gives members access to other benefits, including a Halo Flight helicopter ambulance transport program for $1 a month, about half the price offered for the service. And members enrolled in the retail choice program are eligible to receive capital credits distributions based on the co-op’s operating margins.

“In 20 years of making this work, it’s taken a lot of cooperation from our directors, managers, and staff and a lot of input from vendors and other service providers,” said Irani. “But the payoff has been an increase in overall load for the co-op and distribution of its operating costs over a larger membership pool.”

While some retail electric providers rely on marketing gimmicks like large sign-up bonuses or very low short-term rates, NEC Co-op Energy emphasizes reliability and consistent services, said Wilson.

“When the bonus is gone and the low-rate term is over, [consumers] often get an unpleasant surprise. That’s brought many members who left for other power providers back to us.”

Derrill Holly is a staff writer for NRECA.

ARLINGTON, Va. – As President Biden prepares to deliver his State of the Union address later today, National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson urged policymakers to pave the way to a brighter energy future by maintaining a core focus on affordability and reliability.

“The decisions we make today are critical to determining whether there are sufficient resources to meet tomorrow’s energy needs. Above all, American families and businesses expect an electric system that is reliable and affordable. It is crucial that policymakers approach national energy policy with this fundamental expectation in mind,” said Matheson.

“As we continue to electrify the economy, the electric grid will continue to be even more important and all the more stressed. Mapping our energy future will require technology innovation, a modernized system to move power from where it’s produced to where it’s used, and time to accomplish new investments in an orderly fashion. Failure is not an acceptable option for the American families and businesses we serve.”

Electric cooperatives remain focused on working toward meaningful solutions to address reliability challenges spreading across the nation. This includes pressing for substantive action to reform the process for permitting and siting new electric generation and transmission infrastructure.

At the same time, NRECA is advocating for the U.S. Department of Agriculture to fully utilize $9.7 billion in new funding specifically for electric co-ops to implement energy innovation technologies.  Electric co-ops are prepared to make significant investments in carbon capture, renewable energy production, energy storage, nuclear technologies, and electric generation and transmission efficiency.  However, restrictions or limitations on the program would significantly hinder deployment of the funds.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Exciting new grid investments lie ahead, thanks to significant support from the federal government, but policymakers must be sure to prioritize reliability to ensure a successful energy transition, NRECA CEO Jim Matheson told industry leaders Thursday in Washington, D.C.

“We talk about all of the change in the energy industry, but I’ll tell you something that hasn’t changed for us—job one is keeping the lights on,” Matheson said in his address before the U.S. Energy Association’s 19th Annual State of the Energy Industry Forum. “I fear that people in the policy world are not recognizing the importance of reliability.”

Rolling blackouts in nine states during the December holidays demonstrated how vulnerable the grid and power supplies are to weather spikes and why any transition to new energy resources must be properly managed, he said.

NRECA raises the issue of reliability at every turn, he added, because federal agencies can draft rules that inadvertently harm the grid.

“This is something my membership is concerned about,” Matheson said. “We understand the opportunity of new technologies that are available for the future, and we are excited about them. But when you talk about a transition, they are never totally smooth.”

Matheson also lauded historic wins in Congress last year, including direct-pay tax incentives for co-op energy investments and a $9.7 billion voluntary grant and loan program exclusively for co-ops to buy or build clean energy systems. The program will be administered by the U.S. Department of Agriculture.

NRECA has urged the government to structure those programs to account for “the diversity of circumstances of co-ops across the country,” he told the group. “Keep it simple. Keep it flexible.”

Matheson noted that the $1.2 trillion Infrastructure Investment and Jobs Act contains some two dozen initiatives of interest to co-ops, which led NRECA to set up a resource hub for members to learn the latest details and consortia on five areas: electric vehicles, microgrids, cyber and physical security, smart grids and data, and natural hazards.

“As we continue to electrify the economy, the grid is going to be even more important and all the more stressed,” said Matheson.

“We pride ourselves in the co-op world as being the truth tellers, and we don’t gloss over the words ‘affordability’ and ‘reliability.’ It’s our mission every day and what we do for our members.”

Cathy Cash is a staff writer for NRECA.

Federal energy policies that rush to replace fossil fuel power plants with renewable energy are threatening grid reliability at a time when people need dependable power more than ever to carry them through extreme weather events, the CEO of Ohio Rural Electric Cooperatives told House lawmakers Thursday.

“Wind and solar are great, but their intermittent nature and lack of responsiveness to changing electric demand make these resources less valuable and less reliable than conventional fossil fuel generation,” Patrick O’Loughlin told Republican members of the House Energy and Commerce Committee at a roundtable discussion on energy security.

O’Loughlin is also the CEO of Buckeye Power, a generation and transmission cooperative that supplies power to 25 distribution co-ops. Its generation mix includes coal, natural gas, hydropower, bio-gas and solar.

In Ohio, the number of coal-fired generating plants has plunged from 21 facilities with over 20,000 megawatts in 2009 to five plants with less than 8,000 megawatts today, O’Loughlin said.

He pointed to the 2022-23 Winter Reliability Assessment by the North American Electric Reliability Corp., which warned that increased demand for electricity and reduced generation capacity present unprecedented threats of power shortages and disruptions this winter, especially in areas with extreme, prolonged cold.

The report urged state regulators to “manage the pace” of fossil-fuel-powered plant retirements to ensure an adequate supply of electricity. It also recommended “including extreme weather scenarios in resource and system planning.”

Power plant pollution has decreased substantially during the past 20 years, with carbon dioxide emissions from U.S. power generation falling 33% from 2005 levels, O’Loughlin said. Electric production rose slightly while those emissions dropped, he said.

The need for reliable power will continue to grow, O’Loughlin said.

“Electrification of transportation and buildings will further increase electric demand, allow for further expansion of renewable generation and other technologies, but will require more reliability, not less.”

While new technologies are being developed, proven power sources must continue, he said.

“Our electric power system works on the principles of physics and engineering, not aspirational goals. And today more than ever, people are counting on us to get that right.”

Erin Kelly is a staff writer for NRECA.

Electric cooperatives have yet again risen to the top of the J.D. Power rankings, taking four of the top five spots in the annual survey measuring residential electric customer satisfaction.

Sawnee EMC, headquartered in Cumming, Georgia, was the top-ranking electric utility overall with 809 points out of a maximum 1,000. Georgia co-ops were well-represented at the top of the rankings, with Jefferson-based Jackson EMC placing second with 799 points, followed by Douglasville-based GreyStone Power Corp. (796) and Marietta-based Cobb EMC (792).

The two non-co-op utilities in the top five were SRP, a public utility in Arizona that earned the same score as GreyStone Power, and Tennessee-based EPB of Chattanooga (791).

The 2022 J.D. Power Electric Utility Residential Customer Satisfaction Study is based on responses from 102,879 online interviews conducted from last January through November. The survey targeted residential customers of the nation’s 145 largest electric utilities, representing more than 105 million households. Utility performance was measured in six areas:

• Power quality and reliability
• Price
• Billing and payment
• Communications
• Corporate citizenship
• Customer care

Overall residential satisfaction with electric utilities has dropped steadily since a record high of 751 in 2020. That figure fell to 748 in 2021 and 731 in 2022. Customers gave lower marks because of higher monthly electric bills and “feeling worse off financially,” according to the latest survey.

Electric utilities can improve overall customer satisfaction by as much as 72 points by providing more information on financial assistance and energy efficiency programs, said John Hazen, managing director of utility intelligence at J.D. Power.

“Utilities need to be sensitive to the financial challenges that some customers are experiencing,” Hazen said.

For Sawnee EMC, it’s the second time in three years that it’s taken home the trophy for the top spot. Even so, this year’s score of 809 was lower than the 826 it earned in 2020.

“Scores were lower across the board for all utilities, which doesn’t surprise me,” said Blake House, the co-op’s vice president of member services. “People are getting hit everywhere they turn, at the grocery store and at the gas pump.”

Last August, inflation and supply chain issues forced Sawnee EMC to raise wholesale power costs, which resulted in higher monthly bills for members.

“We delayed it as long as we could, but we were forced to increase our wholesale power cost adjustment on our bill to make up for cost increases we were experiencing,” House said. “We were lucky enough to delay that, and I think that helped. A lot of people got hit for all of 2022.”

Member satisfaction has been boosted by the co-op’s longtime emphasis on reliability by sticking to aggressive right-of-way and preventive maintenance schedules and other measures, said House. Sawnee EMC earned the highest scores among co-ops in the J.D. Power survey for power quality and reliability, price and customer care.

“You can’t be the cheapest and be the best at reliability,” he said. “You can’t have it both ways. But I think our members recognize that we have a great balance of affordable rates, extremely good reliability and second-to-none response time.”

Victoria A. Rocha is a staff writer for NRECA.

NRECA is diving into 2023 with a long list of policy goals that range from shaping a new five-year Farm Bill to helping electric cooperatives prepare for catastrophic wildfires.

“All of our priorities are aimed at helping our members maintain reliable and affordable power and giving them tools to help meet the challenges of the future,” said Hill Thomas, NRECA’s vice president of legislative affairs.

Thomas and Ashley Slater, NRECA’s vice president of regulatory affairs, said their teams will work closely together to help pass legislation that benefits co-ops and then ensure that those new laws are implemented as intended.

Co-ops saw major policy wins in 2021 and 2022 with passage of the bipartisan infrastructure law and key co-op provisions in the Inflation Reduction Act, and NRECA will continue its efforts this year to ensure that members benefit fully from the programs created by those laws.

In a recent Q&A session, Thomas and Slater outlined what’s ahead for co-op policy goals.

What are NRECA’s top regulatory priorities for 2023?

Slater: I have a long list!

• Implementing NRECA’s two priority provisions in the Inflation Reduction Act: direct-pay energy tax credits and the $9.7 billion U.S. Department of Agriculture program to assist co-ops with the energy transition.

• Shaping agency funding opportunity announcements for co-op programs included in the $1.2 trillion bipartisan infrastructure law. Those programs include rural broadband, electric vehicle programs to build a network of chargers, grid resiliency and modernization, physical security and cybersecurity, and clean energy programs.

• Protecting co-op access to an affordable, reliable power supply as the Environmental Protection Agency looks to regulate greenhouse gas emissions and air pollutants.

• Ensuring sound transmission policy as the Federal Energy Regulatory Commission contemplates first-in-a-decade transmission reform.

• Ensuring that the Department of Energy uses its presidentially directed Defense Production Act authority appropriately to ease supply chain shortages.

• Ensuring that any new cybersecurity or physical security reporting requirements by the Department of Homeland Security are optimized for co-ops to enhance their security posture and improve their ability to protect against, detect and respond to—or recover from—threats to the electric system.

• Modernizing environmental permitting. The existing processes take too long, are too expensive and are an impediment to co-ops’ ability to meet future energy needs. They need to be modernized to give more certainty in the energy transition.

• Working with co-ops to prepare for and respond to catastrophic wildfires. Co-ops that want to do vegetation management are running into inconsistent guidance from the Bureau of Land Management and the Forest Service. We need to work with the agencies to streamline the process.

• Working with co-ops to ensure that the broadband maps produced by the Federal Communications Commission are done correctly to provide the best picture of where broadband is and isn’t available across the country. The FCC has released a pre-production draft of its latest broadband maps.

What are NRECA’s top legislative priorities for 2023?

Thomas: For the first couple of months, our top priority will be holding Co-op 101 sessions to meet the 81 new members of Congress and educate them about electric cooperatives. Beyond that, we want to make sure Congress is engaged when they need to be to ensure the legislation that has already passed is implemented the right way to benefit co-ops and their members.

A new five-year Farm Bill is being written by Congress that will affect electric co-ops and all of rural America, so that will be a priority. And we support a bipartisan permitting modernization conversation. Also, we’re going to continue to face supply chain problems, and we’re going to continue to work to solve that.

We’ve already had co-op leaders come and testify to Congress about the upcoming Farm Bill. How will it affect electric co-ops specifically?

Thomas: The Farm Bill is the only piece of legislation that Congress does that is uniquely and specifically aimed at rural America. It is designed to support rural America and we share that goal. It’s important for us to talk about our priorities, including many of the USDA programs that we use such as rural development financing, the home energy efficiency program and clean energy deployment financing. These programs can be reauthorized in the new Farm Bill, and we want to make sure they’re operating as effectively as possible and are good to go for the next five years.

The other big conversation will be about broadband. There’s an opportunity to rewrite and improve the USDA ReConnect broadband program, which has provided opportunities to many of our members but could also operate more efficiently. It’s a fairly new program that has received lots of money, but some of our members haven’t been able to get access to it because it’s just too bureaucratic. We need to streamline the program so we can serve the communities that need it most.

Is the environment in the Biden administration and in Congress, with divided government, conducive to accomplishing NRECA’s goals?

Thomas: On the congressional side, with the House majority and the president being from different parties, it is going to be a tough environment for big, game-changing legislation. But we have a good reputation for being able to bridge gaps and find partnerships and bipartisanship. I think there will be lots of opportunities for us to engage in these important conversations.

Slater: We recognize that resource planning decisions are unique to the needs of the specific co-op and the communities they serve. The administration understands that if they want their policies to have a real impact, they have to reach rural America. And they can’t get there without electric co-ops.

That presents a real opportunity for our members who want to participate. In order to push an energy transition across the country, if you want to get there, you have to go through electric co-ops. If there’s no uptake, you’re not going to be successful in getting these dollars utilized…To the extent that we can be a conduit, that’s our edge.

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson called the North American Electric Reliability Corporation’s latest reliability assessment a “clear and constant warning about the nationwide consequences of continuing a haphazard energy transition.”

“This assessment paints a stark and disheartening picture of the reliability challenges facing much of the United States this winter,” Matheson said. “As the demand for electricity risks outpacing the available supply during peak winter conditions, consumers face an inconceivable but real threat of rolling blackouts. It doesn’t have to be this way. But absent a shift in state and federal energy policy, this is a reality we will face for years to come.

“The pursuit of an energy transition that prioritizes speed over practicality has jeopardized America’s ability to keep the lights on. Today’s energy decisions will determine whether there are sufficient resources for the lights to come on tomorrow. Failure is not an acceptable option for the American families and businesses we serve.”

A recent report from the National Renewable Energy Laboratory concluded that in order to reach the Biden administration’s goal of a zero-carbon grid by 2035, U.S. power generation capacity would have to triple from 2020 levels. Electric transmission infrastructure would need to double or triple as well.

“Electric cooperatives remain focused on working toward meaningful solutions to address reliability challenges spreading across the nation,” Matheson said. “This includes pressing for meaningful action to reform the process for permitting and siting new electric generation and transmission infrastructure.”

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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A resilient, reliable electric grid that provides affordable power is crucial for rural communities as America transitions to cleaner energy, the CEO of an Illinois electric cooperative told a Senate committee Tuesday.

“Diversity of electric generation is essential to our commitment to a lower carbon future,” Mike Casper, president and CEO of Jo-Carroll Energy, told the Senate Agriculture Committee at a hearing on the 2023 Farm Bill.

“As cooperatives look to the future, we are exploring all options, technologies and ideas to work to meet the evolving energy needs of the local communities we serve.”

Casper testified that electric co-ops are facing three key challenges:

• Responding to consumer-members’ desire for a diverse energy mix.
• Maintaining reliable baseload power as part of a lower-carbon future.
• Providing services beyond electrification, including rural broadband.

“Unlike the rest of the electric sector, electric co-ops sell the majority of their power to households rather than businesses,” Casper said. “Keeping rates down for rural families at the end of the line is especially important for JCE.”

The Elizabeth, Illinois-based co-op serves about 26,500 electric and natural gas accounts in four counties and provides high-speed internet service to more than 3,000 subscribers through its broadband division, Casper said.

The distribution co-op gets its power from two generation and transmission co-ops, Dairyland Power Cooperative and Prairie Power Inc., both of which have made substantial investments in renewable energy.

“Dairyland recently completed a large wind power purchase agreement to power 16,000 homes in addition to their current renewable portfolio that makes up over 20% of their generation mix,” Casper said. “Prairie Power is similarly investing in renewable energy through solar farm ownership and power purchase agreements for solar and wind energy.”

Jo-Carroll Energy is supplementing that power by developing three community solar arrays, which resulted from feedback the co-op received from member surveys, Casper said. The U.S. Department of Agriculture’s Rural Energy for America Program provided more than $89,000 in grants to help create one of those solar farms.

A new $9.7 billion USDA program created by Congress this year as part of the Inflation Reduction Act will also help interested co-ops build new clean energy systems by providing grants and loans for projects that include renewable energy, energy storage, carbon capture, nuclear power, and generation and transmission efficiency, Casper said.

“These programs will help co-ops meet the future energy needs of the communities they serve while providing important flexibilities to maintain reliable, affordable power in rural America,” he said.

Electric co-ops rely on funding from USDA’s Rural Utilities Service Electric Program to help pay for essential electrical infrastructure projects, Casper said. But too often, he said, RUS loan approvals are “needlessly lengthened by environmental reviews and decision delays.”

“To meet our nation’s growing electricity needs,” Casper said, “electric cooperatives would benefit greatly from reforms to the federal permitting process that maintain robust environmental protections while ensuring determinations are made in a timely manner.”

Co-ops want to continue to collaborate with Congress to help develop the next Farm Bill, Casper said.

“JCE and the rest of our nation’s electric cooperatives look forward to working together in our shared goal of powering and improving the lives of rural Americans,” he said.

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association CEO Jim Matheson today issued the following statement regarding the midterm elections.

“Keeping the lights on and bolstering the rural American economy are goals that transcend party lines,” Matheson said. “As the nation works towards a future that depends on reliable electricity to power the economy, policymakers must recognize the vital role they play in setting policies that enhance electric reliability and preserve affordability for rural families and businesses.

“America’s electric cooperatives are focused on people, not profits as they work to power stronger communities. That community focus and the millions of voices from those rural and suburban communities will continue to define our congressional outreach as we work in a nonpartisan way to move legislation that builds a brighter future for America.”

Among the priorities for electric cooperatives in the 118th Congress:

• Pressing lawmakers to approach energy policy with affordability and reliability at the core. Today’s energy decisions will determine whether there are sufficient resources for the lights to come on tomorrow.
  
• Advocating for meaningful reforms to the process for permitting and siting new electric generation and transmission infrastructure as well as accelerating approval of multi-agency permits for vegetation management that will help prevent wildfires.
  
• Expanding access to rural broadband and ensuring the accuracy of Federal Communications Commission service maps so that federal funds are dedicated to projects that most efficiently close the digital divide.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Transitioning to a lower-carbon electric grid will place electric reliability at risk unless there is sufficient always-available generation and infrastructure to support the nation’s growing electricity demand, NRECA CEO Jim Matheson said at a Sept. 30 press briefing held by the United States Energy Association.

“We’ve been very firm as a national association that the notion of the electric sector hitting zero net carbon emissions by 2035 can’t happen without severely compromising the reliability of the electric grid,” Matheson said at the USEA virtual event.

With demand for power sharply increasing, always-available generation—nuclear, natural gas or coal—must remain essential elements of the generation portfolio to ensure a reliable and affordable electricity supply. Intermittent renewables alone will not get the job done, he said.

“We’re concerned about reliability,” Matheson said. “You need to have always available, dispatchable resources to maintain the grid. It can’t be 100% intermediate resources and work.”

In addition, substantially more time will be required to build transmission and other infrastructure to tap low-emission energy resources, he said.

“Siting a transmission line is really difficult,” he said.

Matheson praised Congress for its recent passage of the Inflation Reduction Act with direct-pay incentives and the 2021 infrastructure law with funding provisions that will provide “significant opportunities for electric cooperatives to access funds to make real investments in their systems.”

“These pieces of legislation have helped level the playing field and given cooperatives more opportunity,” he said.

David Naylor, president of Rayburn Country Electric Cooperative, a generation and transmission wholesaler based in Rockwall, Texas, also participated in the USEA event and underscored that “our members drive a lot of what we do.”

“As we look to the transition, you know it’s about more than just the commodity itself,” Naylor said. “What’s that value proposition for that member, the consumer at the end of the line? Because that’s ultimately what drives us. We have to be able to show that we’re providing value to those folks.”

Cathy Cash is a staff writer for NRECA.

As America moves to electrify more of its economy, electric cooperatives and other utilities will need to generate more electricity. But that’s difficult to do as plants fueled by always-available power shut down, NRECA CEO Jim Matheson said Wednesday during an Axios event focused on the future of energy.

The event was sponsored exclusively by NRECA and is part of the association’s ongoing effort to elevate the reputation of electric cooperatives inside the Capital Beltway.

“Lowering the overall carbon footprint in this country means we’re going to electrify more and more of our economy,” Matheson said during the virtual event, which also featured Sen. Michael Bennet, D-Colo., and Rep. Bob Latta, R-Ohio. “We need to be making a lot more electricity, but instead, we are reducing our capacity with the shutdown of power plants.”

Solar and wind power can be an important part of a broader energy portfolio, but they are only available part of the time, Matheson said. “At the end of the day, you need power that is there all the time, and that’s going to be nuclear or coal or natural gas.”

The North American Electric Reliability Corp., in its recent long-term grid reliability assessment, said that aggressive government efforts to reduce carbon emissions are among the factors increasing the risks to grid reliability.

“The report said we’re facing greater risk in 2022, and those risks are only going to increase in future years as demand grows, partly driven by extreme weather events,” Matheson said. “And, at the same time, the report said the country is experiencing, in their words, ‘the disorderly retirement of baseload power plants.’

“Electric cooperatives have worked to amplify the NERC report to make sure policymakers, both at the federal and state level, understand that the policy decisions that people are going to make have an impact on the grid … We want to make sure they understand that reliability should be a key focus in all of their policy recommendations.”

Matheson said electric co-ops will benefit greatly from two major pieces of legislation passed by Congress.

The Infrastructure Investment and Jobs Act passed last fall “has so many different programs that offer funding to build better resilience into the electric system, both on the generation side and on the transmission and distribution side,” he said.

And just last month, Congress passed a budget bill that provides direct-pay tax credits for electric co-ops to deploy energy technologies, including carbon capture, nuclear, energy storage, renewables and more. For-profit utilities have had access to tax incentives for decades, but the credits had been out of reach for co-ops since most don’t pay federal income taxes.

“Those two pieces of legislation give us new tools, more flexibility, more investment capacity for our systems,” Matheson said. “And if we project out 10, 20, 30 years from now, people are going to look back at these two pieces of legislation as having tremendous significance in terms of building out a more reliable electric grid.”

Erin Kelly is a staff writer for NRECA.

The ongoing global supply chain crisis, brought on by COVID-19 pandemic disruptions and exacerbated by other factors like the Russian invasion of Ukraine, has spurred double-digit inflation, frustrated companies and consumers and driven the U.S. economy to the brink of recession. Electric cooperatives are feeling the brunt of the impact, facing unprecedented challenges in procuring key grid components like transformers, conductor and power poles.

How are co-ops leading the industry in finding ways to manage and mitigate this supply crunch? Hear from Martha Duggan, NRECA’s senior regulatory affairs director, and Buddy Hasten, president and CEO of Arkansas Electric Cooperative Corp. and Arkansas Electric Cooperatives Inc.

Listen to the episode below:

You can also listen and subscribe to Along Those Lines on your preferred podcast service:
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Related Content:

Tiger Team: Electric Co-op Leaders Join Effort to Ease Supply Chain Problems
Co-op Forum: Supply Crunch
Infographic: Trouble With Transformers

Find out more about NRECA’s podcast. Questions or suggestions? Email us at AlongThoseLines@nreca.coop.

A group of electric cooperative executives is collaborating with power industry leaders and the federal government to find solutions to supply and logistics challenges that are threatening the nation’s energy needs.

The Electricity Subsector Coordinating Council’s new Tiger Team, created in June, will be chaired by a co-op representative and includes co-ops, public power providers, investor-owned utilities and key federal agencies that are working together to address current shortages and develop strategies to prevent recurrent challenges. Panel members are sharing their operational expertise, identifying alternative vendor sources for essential products and making recommendations to the government on potential solutions.

“The COVID-19 pandemic caused everything to stop or slow down for about 18 months,” said Buddy Hasten, president and CEO of Arkansas Electric Cooperative Corp. and Arkansas Electric Cooperatives Inc. and chairman of the Tiger Team. “When the world emerged from the worst of the pandemic and got back to business, there was a lot of pent-up demand in the economy.”

Stepped-up activity in residential and commercial construction, labor shortages, and increased federal and state investments in power and broadband infrastructure have contributed to scarcity of certain essential parts and materials. Electric transformers, utility poles, electrical conductor and fiber optic cable are among the products in short supply or facing shipping delays.

Many utilities were forced to deplete their warehouses and staging yards to meet construction demand or handle repairs while manufacturing was stalled.

“This has eroded the traditional reserve inventory of critical infrastructure. Given the supply chain constraints, there are long lead times making it almost impossible for utilities to restock to normal levels of inventory for storm seasons,” Hasten said.

The structure of the Tiger Team ensures that all members, regardless of customer base, revenue or the size of their service territory, will have a voice in policy discussions. It also offers opportunities to share information on emerging issues before they become major problems.

“Addressing ongoing supply chain challenges requires an understanding of the diverse impacts, exceptional collaboration and an openness to creative solutions,” said NRECA CEO Jim Matheson. “It’s great to have electric co-op leaders play a leading role on this Tiger Team, which will be key to identifying potential solutions and ensuring our government partners help take appropriate steps to address the problem.”

Ten members of the Tiger Team were selected by NRECA, the American Public Power Association and the Edison Electric Institute, the association representing investor-owned utilities. In addition to Hasten, co-op representatives are Tim Mills, president and CEO of ERMCO, a manufacturing enterprise owned and operated by Arkansas co-ops; Chris Perry, president and CEO of United Utility Supply, a logistics co-op headquartered in Louisville, Kentucky; and Bob Bisson, vice president of electric system development at Northern Virginia Electric Cooperative, a Manassas-based distribution co-op.

According to the National Association of Manufacturers, there are currently 850,000 full-time manufacturing jobs available in the United States, and a significant percentage of those openings are entry-level positions requiring only high school diplomas. NAM projects a need for 4 million new workers to fill manufacturing positions through 2030.

“An expanded labor force is the only possible near-term solution at ERMCO. Further investments in capacity for both raw materials and transformer production is the long-term solution,” said Mills.

The Tiger Team will meet weekly over the next few months to consider recommendations developed by its members to address near-term challenges and sustainable solutions to meet current and future supply needs.

“The supply chain disruptions are not the same for all manufacturers, and given the random nature of the disruptions, there can be a corresponding randomness to how each manufacturer is impacted,” said Hasten. “Having more than one option to obtain the needed supplies provides a cooperative a higher probability of getting what is needed. However, there are certain limitations to this in that there are some sectors where demand has outpaced supply across the board. These challenges are what we are trying to solve.”

Derrill Holly is a staff writer for NRECA.

Congress must heed recent warnings about grid reliability to ensure that electric cooperatives can continue to provide rural Americans with reliable, affordable power, an Arkansas co-op leader told a Senate panel Friday.

“Electric cooperatives are committed to keeping the lights on across rural America at a cost that families can afford,” said Buddy Hasten, president and CEO of the Arkansas Electric Cooperative Corp., in testimony before the Senate Agriculture, Nutrition and Forestry Committee at a field hearing at Arkansas State University.

“As we look to the future, we worry that federal and state policies, as well as market changes, are causing an imbalance of electric supply and demand that jeopardizes our ability to fulfill this commitment.”

He noted that the North American Electric Reliability Corp. warned in its 2022 Summer Reliability Assessment that parts of the Midwest could face outages during periods of peak demand.

“Put simply, this is because generation capacity has been reduced while peak demand is projected to increase—decreasing supply while increasing demand,” he said. “A concerning pattern is forming in which baseload generation such as natural gas, coal and nuclear energy is prematurely retired and then replaced primarily by intermittent generation like wind and solar.”

It will take a diverse energy mix to provide the power that Americans depend upon, Hasten said.

“To be clear, this is not about prioritizing one energy source over another,” he said. “Our focus is whether we will have the diverse tools needed to keep the lights on for American families and businesses.”

When the electric grid fails, “it almost always results in financial catastrophe and loss of human life,” Hasten said. “It’s important for lawmakers to understand the pivotal role they play in this conversation.”

Hasten also urged Congress to streamline the U.S. Department of Agriculture’s ReConnect Loan and Grant Program, which provides funding for electric co-ops and others to bring high-speed internet to rural communities with little or no broadband service. The Senate agriculture committee is looking to reauthorize the program in the 2023 Farm Bill.

In Arkansas, 14 of the 17 electric co-ops provide broadband service to their members and greatly appreciate the funding provided by ReConnect, Hasten said. However, he said the program is unwieldly and is designed for a traditional telecommunications company, failing to take into account the co-op business structure that has been used successfully for more than 80 years. He said the ReConnect requirements can be especially difficult for small co-ops to navigate since they don’t have large staffs to administer the program.

“As Congress begins to think about the next Farm Bill, ensuring that these programs are flexible and streamlined will allow electric cooperatives to deploy fiber resources as quickly and efficiently as possible,” Hasten testified.

Congress could also help electric co-ops reduce costs for rural Americans by passing key legislation to refinance federal loans and provide direct payments for energy innovation, Hasten told the senators.

In Arkansas, almost every co-op borrows from USDA’s Rural Utilities Service to build and maintain their infrastructure, he said.

“Unlike a private business loan or typical home mortgage, these RUS loans are unable to be refinanced to current market rates without facing a significant prepayment penalty,” he told the senators.

Without relief, co-ops will have to pass expensive debt costs along to their members, Hasten said. He urged senators to support the Flexible Financing for Rural America Act, which would allow co-ops a one-time rate adjustment to current market rates without penalties.

“For electric cooperatives in Arkansas, this would yield over $100 million in future savings for our member-owners,” he said.

Hasten also asked senators to support direct federal payments to not-for-profit co-ops as incentives to help pay for developing new energy resources and technologies, including renewable energy, battery storage projects, nuclear energy facilities and carbon capture and storage.

“Many newer, cleaner technologies are attractive to rural utilities,” he said. “We serve the areas where you are most likely to see expansive solar farms or clusters of wind turbines; however, we are handcuffed by the tax code and the significant capital expenses required to deploy innovative technologies.”

Erin Kelly is a staff writer for NRECA.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson issued the following statement on President Biden’s action today to invoke the Defense Production Act to accelerate the production of energy technology and equipment:

“For several months, America’s electric cooperatives have raised serious questions about supply chain disruptions to materials necessary for reliable operation of the nation’s electric infrastructure. In particular, shortages of transformers pose a risk to normal electric grid operations as well as recovery efforts for systems disrupted by a natural disaster. The Biden administration’s use of the Defense Production Act to shorten lead times for supplies of electric transformers is a much-needed step to support reliability and resilience, and NRECA urges inclusion of all stakeholders in the implementation process as well as additional measures to avoid unnecessary interruptions to electric grid operations.

“Numerous assessments have revealed the potential challenges to electric reliability in several states, and NRECA and its members have sought relief for supply chain shortages across the electric sector. That’s particularly true in fast-growing areas of our country and where severe storms threaten our commitment to reliable electricity for 42 million electric cooperative members.

“America’s electric cooperatives look forward to continuing to work with the Biden administration and Congress to reduce supply chain vulnerabilities in the short term while we increase domestic capability to meet our future needs. American families and businesses rightfully expect the lights to stay on at a price they can afford. A diverse energy mix that includes adequate baseload supply and an assured supply chain are essential to meet those expectations.”

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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ARLINGTON, Va. – The National Rural Electric Cooperative Association (NRECA) today said that President Biden’s “permitting action plan” fails to deliver the necessary reforms to streamline environmental reviews and permitting of electric transmission and other projects to modernize America’s electric infrastructure. Such projects are essential to maintaining the safe, affordable and reliable delivery of electricity across the nation.

“The administration’s plan fails to address the root of the environmental review and permitting problems plaguing the electric sector,” said NRECA CEO Jim Matheson. “As we plan for a future that depends on electricity as the primary energy source for most of the American economy, the streamlined siting and permitting of electric infrastructure projects will be a key success factor. Robust reforms are needed to remove barriers and accelerate the construction of modern energy infrastructure.”

For years, electric cooperatives have encouraged policymakers to support solutions that modernize the National Environmental Policy Act (NEPA) and facilitate coordinated, consistent, and timely agency decision-making. Lack of federal coordination, inconsistent processes, and protracted litigation have forced communities to endure costly project delays, some of which led to project cancelation, and threats to electric reliability.

The 102-mile Cardinal-Hickory Creek Transmission Line Project is one example of the need for significant reforms. Work on the project began in 2014 to bring renewable energy online in the upper Midwest. Nearly 115 renewable energy projects are dependent upon the completion of this transmission line. The project’s timeline was jeopardized after a court ruling blocked it from crossing the Mississippi River, which could significantly delay and drive up the project’s costs.

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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Supply chain disruptions plaguing the electric industry are a top focus for the Department of Energy, the principal deputy director of the agency’s Office of Policy told electric cooperative leaders Monday at NRECA’s Legislative Conference.

The COVID-19 pandemic created global supply chain problems that have been exacerbated by the fact that many crucial components for the energy industry are not made domestically, said Carla Frisch, who is also the acting executive director of the policy office.

NRECA has held a series of briefings with the White House and DOE on supply chain challenges and has encouraged the administration to take action to limit the impact of equipment shortages on electric co-ops. Among the equipment shortages affecting co-ops are a scarcity of transformers, conductor for power lines and fiber optic cable.

DOE officials want to continue to partner with electric co-ops to help solve the supply chain problem in both the short and long term, Frisch said.

“Our focus is: How can we help communities build the economic prosperity that they need?” she said. “You’re at the heart of that.”

Frisch said DOE is already working closely with NRECA and through the Electricity Subsector Coordinating Council. The council serves as a liaison between the federal government and the electric power industry on how best to prepare for, and respond to, large-scale natural disasters and threats to critical infrastructure.

DOE has a new network of “regional specialists” that co-ops can now reach out to for help and advice, Frisch said.

“The door is open to co-ops,” she said. “We really want to understand the work you’re doing.”

Frisch also said she hopes that co-ops will take full advantage of the funding opportunities in the $1.2 trillion bipartisan infrastructure bill passed by Congress last year.

The law provides billions for broadband deployment, EV charging networks, electric transmission, energy storage, carbon capture and other clean energy technologies.

“The bipartisan infrastructure law is a very significant investment in the U.S. energy sector,” Frisch said.

Erin Kelly is a staff writer for NRECA.

Electric cooperatives are increasing their investment in renewable energy, but baseload resources like coal and natural gas must continue to be part of the mix to ensure reliable, affordable power for rural America, the leader of Central Iowa Power Cooperative told a House panel Tuesday.

“As we look to the future, intermittent resources such as wind and solar must continue to be complemented and supported by always-available baseload energy resources like coal and natural gas,” Bill Cherrier, executive vice president and CEO of the generation and transmission co-op, testified before the House Agriculture Committee. “System reliability depends on the ability to blend intermittent sources like wind and solar with firm, flexible and dispatchable electric capacity.”

CIPCO, which serves nearly 300,000 residents and more than 13,000 commercial and industrial accounts, has a diverse portfolio that includes wind, solar, hydropower, landfill gas, natural gas, coal and purchases on the market.

“CIPCO’s generation portfolio has evolved significantly, with wind growing from 4.1% in 2010 to 29.9% in 2021 and coal dropping from 58.4% to 29.3% during that same time period,” Cherrier said at a hearing reviewing the 2018 farm bill’s impact on renewable energy opportunities in rural America.

Moving ahead, the co-op recently deployed the 100-megawatt Wapello Solar LLC and the 54-MW Independence Wind power purchase agreements. CIPCO is investing in an additional 100-MW solar project. At the same time, CIPCO recently invested $85 million in its existing Summit Lake generation plant, adding efficient reciprocating natural gas engines that serve peak electric demand, Cherrier said.

“This investment complements our intermittent wind and solar resources while ensuring the baseload generation necessary to meet the 24/7 power needs of Iowans and businesses in CIPCO’s service territory.”

As co-ops add more renewable energy, it’s “critical that policymakers work constructively with industry to achieve these objectives while maintaining the exceptional reliability and affordability that American families and businesses expect and deserve,” Cherrier said.

He urged Congress to approve direct federal payments to co-ops to put them on a more equal footing with for-profit utilities, which have long received tax incentives to invest in renewable energy projects. Co-ops cannot access those incentives because they do not pay federal income taxes.

“The federal tax-credit structure prevents not-for-profit electric cooperatives like CIPCO from taking advantage of the tax benefit to directly build and own wind and solar generation assets,” Cherrier testified. “For cooperatives to reap any benefit for this transition, we must work with third parties that develop and own these assets.

“Direct-pay tax incentives would level the playing field for all electric providers, allowing co-op-member systems and member-owners down the line to have equal access to a diverse power supply mix.”

Congress could also boost rural America’s economy by passing legislation to allow electric cooperatives to refinance federal Rural Utilities Service loans at lower interest rates without penalty, he said.

NRECA and its member co-ops are calling on lawmakers to approve the Flexible Financing for Rural America Act, which permits co-ops to refinance their RUS electric loans without facing costly prepayment penalties. An average co-op with typical RUS debt could save $2 million per year in interest payments at today’s interest rates.

“This essential step will give co-ops the flexibility to best manage their financial circumstances while focusing on cooperatives’ long-term stability and that of the communities they serve,” Cherrier said.

Erin Kelly is a staff writer for NRECA.

Achieving 100% carbon-free electricity generation by 2035 is an overly ambitious goal that could threaten grid reliability and requires technology that is not yet available, NRECA CEO Jim Matheson told a Senate panel Wednesday.

The Biden administration has set a goal of a carbon-free electric sector by 2035.

“As our nation works to strengthen energy security and reliability while also protecting the environment, we must realize that it is not an all-or-nothing choice,” Matheson testified before the Senate Environment and Public Works Committee. “We can address these priorities—but it requires technology and time beyond what is currently available and what many have called for.”

Matheson said lawmakers should focus on three key points as they consider the nation’s energy future:

• A resilient and reliable electric grid that affordably keeps the lights on is the cornerstone of American energy security and the national economy.

• The ongoing energy transition must recognize the need for time and technology and be inclusive of all energy sources to maintain reliability and affordability.

• The bipartisan infrastructure bill made important investments to support an energy transition, but additional actions on tax credits, permit streamlining and coordination on electrification will be required to meet future energy needs.

Matheson urged senators to oppose efforts to “mandate energy sector transformations over unreasonable or unrealistic timelines and that fail to account for regional differences in energy resource availability or the potential for stranded assets.”

He pointed to a recent long-term reliability assessment by the North American Electric Reliability Corp. warning of the risks of energy shortfalls during extreme weather if too much baseload generation is retired prematurely.

“Such policies would have significant impacts on the reliability and security of the electric grid and could have an undue economic impact on co-op consumer-members, particularly as additional costs must be incurred for replacement generation,” he said at a hearing focused on American energy security and investments in clean energy technologies.

Electric cooperatives are accelerating energy innovations and investments in clean energy to reduce carbon emissions, Matheson said. Co-ops lowered their CO2 emissions by 23% between 2005 and 2020—the equivalent of taking nearly 9 million cars off the road.

“As electric co-ops continue to reduce CO2 and other emissions, it is critical that policymakers work with industry in a constructive manner that achieves these objectives while maintaining the exceptional reliability and affordability that American families and businesses expect and deserve,” Matheson said.

The electric sector is poised to play a major role in reducing carbon emissions through increased electrification of the transportation, agricultural and industrial sectors, he said.

“Electrifying other sectors of the economy, however, will require a three-fold expansion of the transmission grid and up to 170% more electricity supply by 2050, according to the National Academies of Sciences,” Matheson testified.

“The increasing role of electrification will place more demands on the electric grid and generation portfolio, and measures to enhance grid reliability are essential to maximize emission reductions and keep costs affordable.”

The bipartisan Infrastructure Investment and Jobs Act passed by Congress last November “included significant opportunities for electric co-ops and the communities they serve through programs supporting clean energy deployment, grid resiliency and modernization, physical and cybersecurity, electric vehicles, and rural broadband,” Matheson said.

But he said more must be done to provide tax incentives, streamline the permitting process and coordinate electrification efforts.

“Policymakers must continue to balance realism with aspiration while recognizing that any energy transition will require additional time and technology and must be inclusive of all energy sources to maintain the reliability and affordability that is the cornerstone of American energy security.”

Erin Kelly is a staff writer for NRECA.

A year after a prolonged severe winter storm caused the near-collapse of the Texas power grid and left more than 4 million households without electricity, state lawmakers, regulators and power providers have worked to assess the causes of the outages and harden critical infrastructure. When another cold snap hit the state early this February, those measures were tested in real-time.

Julia Harvey is vice president of government relations and regulatory affairs at Texas Electric Cooperatives, the statewide association that represents 76 co-ops serving more than 4 million members. She recently discussed steps that have been taken over the past year to shore up the energy grid and what still needs to be done.

The widespread outages last year have been largely attributed to failures in the state’s natural gas infrastructure, is that right?

Harvey: Yes. There was some interplay between natural gas assets and the electric utility system that we had not seen to this extent before. When some aspects of the natural gas transmission system were affected by sustained freezing temperatures, multiple electric generation resources were not able to operate at full capacity because their fuel supply was constrained.

The loss of fuel access for electric generation became a multiple-day event. Because so much generation was unavailable and demand was so high, ERCOT [the Electric Reliability Council of Texas], which manages the statewide grid, had to invoke load shedding operational rules to help stabilize the system.

What have you learned in the past year, and what tangible steps have been taken to reduce the chances of such extreme disruptions from happening again?

Harvey: The susceptibility of certain infrastructure to freezing was central to changes in both legislation and Texas Public Utility regulations. More than 4,000 access points on key utility infrastructure have been inspected since September, and enhanced weatherization measures have been implemented to support increased resiliency during extreme weather.

According to ERCOT, on-site inspections have been completed at 302 generation facilities and 22 transmission facilities, and 321 of those sites now meet winterization requirements imposed by the legislature and the PUC. As important as generation weatherization is, a reliable grid can only be achieved when the gas system is also weatherized.

In regard to the [natural] gas system, an additional reform relates to a new critical infrastructure map being created by the PUC and the Texas Railroad Commission, which regulates the oil and gas industry. This map will reflect current and future operational needs related to the gas supply chain. That allows certain gas transmission assets to be designated as essential so they are prioritized by electric utilities during a load shed event. Gas facilities identified on the map will also be required to weatherize, which will support increased resiliency on the system.

Are you confident that all the relevant state agencies are working together effectively on this issue?

Harvey: Last February’s freeze highlighted the importance of coordination and communication between both the electric and natural gas industries and the regulatory agencies that oversee various aspects of their operations.

The Texas Legislature has now formalized a framework to make that work. It’s a council of oil and gas representatives, the PUC, the railroad commission, and ERCOT that establishes a venue and a forum for communications during emergency events to help ensure that the electricity supply chain operates reliably during emergencies.

How confident are you that co-op voices are being heard as the nature of Texas energy markets and industry oversight evolves?

Harvey: Leading up to the freeze event during the first week of February [2022], the PUC, ERCOT and the new Texas Energy Reliability Council created by the legislature were very good about communicating with all segments of the industry—including cooperatives—regularly and consistently. We feel like we have a seat at the table from the cooperative perspective and our concerns are being heard and addressed. Part of the framework of ERCOT, reaffirmed since the 2021 event, has been the importance of effective communications on market issues, and regulators recognize this.

What challenges remain for the state’s grid?

Harvey: We are fully expecting more changes to be made to the electric system, both to infrastructure and market aspects of the business. Those include the need for weatherization of natural gas components. That’s why advancement and completion of key infrastructure mapping is so important. Portions of those systems need to be weatherized so they can better withstand extreme weather. We also expect additional weatherization requirements to be adopted for electric utility and generation infrastructure.

One of the highest-profile consequences of last year’s event was the run-up on the price of natural gas, which directly affects the price of electricity. Some customers in retail choice areas were directly exposed to those prices. Has that been addressed?

Harvey: In certain retail markets not served by co-ops or public power providers, there is retail choice. During the 2021 freeze, certain providers indexed retail rates to $9,000 per megawatt-hour of electricity, and that led to enormous bills for some consumers. That practice has now been prohibited. The legislature also took steps to ensure that retail choice providers have a higher standard of accountability. Further, the maximum wholesale price has been reduced by the PUC to $5,000, so prices will not rise to the level seen last February.

What do consumers need to know about the changing nature of electric markets and how they can affect reliability?

Harvey: Extreme operating events like the 2021 cold snap underscore the importance of maintaining diversified “all options” generation portfolios that provide service and pricing flexibility.

We support an all-of-the-above energy strategy that allows the evolution of our market design to make sure that with that growth of renewables, that conventional thermal dispatchable generation still has a place in Texas to back that up.

Derrill Holly is a staff writer for NRECA.

The electric industry is facing one of the most challenging and disruptive times in its history as changes in policy, energy markets and consumer expectations drive fundamental changes in how utilities generate and deliver electricity.  

Electric cooperatives recognized this trend more than a decade ago and have been adding wind and solar to their generation portfolios as well as leading innovation in the development of microgrids and carbon capture and sequestration. Today, increasing social, economic and political pressure to accelerate the timeline for this transition is causing concern among electric co-ops and other utilities over how it will affect their ability to reliably and affordably provide electricity.

To delve into this important topic, we’re joined by Lisa Johnson, CEO and general manager of Seminole Electric Cooperative in Florida, and Pat O’Loughlin, president and CEO of Ohio’s Electric Cooperatives and its generation and transmission co-op, Buckeye Power.

Listen to the episode below:

You can also listen and subscribe to Along Those Lines on your preferred podcast service:
Apple Podcasts | Google Podcasts | Stitcher | Spotify | YouTube

Find out more about NRECA’s podcast. Questions or suggestions? Email us at AlongThoseLines@nreca.coop.

ARLINGTON, Va. – National Rural Electric Cooperative Association (NRECA) CEO Jim Matheson today issued the following statement on House passage of the budget reconciliation bill.

“As electric co-ops work to reliably meet future energy needs at a cost that consumers can afford, they must have equal access to energy incentives and programs,” Matheson said. “The House bill would give co-ops access to direct-pay incentives for energy innovation and create a $10 billion program to support co-ops’ voluntary clean energy transition. This is appropriate recognition of the need to level the playing field for not-for-profit cooperatives, reduce costs and open new doors for innovation.”

The House bill includes two provisions relevant to co-ops:

Direct Pay Energy Innovation Tax Credits: Because electric co-ops are not-for-profit, consumer-owned businesses, they do not pay federal taxes. As a result, co-ops have not been eligible to receive federal tax incentives to promote renewables and other innovative technologies that for-profit utilities have enjoyed for years. The House bill addresses this inequity by providing direct payments to co-ops and municipal utilities to promote investments in new technologies.

USDA Voluntary Energy Transition Program: The bill includes $10 billion that can be used by electric co-ops to help defray the costs of voluntarily retiring coal plants or investing in renewable energy and other technologies that reduce carbon emissions. 

The National Rural Electric Cooperative Association is the national trade association representing nearly 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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An executive representing generation and transmission cooperative interests is urging Congress to help clear bureaucratic and legal barriers that add burdensome delays and increase costs for transmission projects connecting population centers to new sources of renewable energy.

“There is tremendous opportunity to utilize federal lands for both generating renewable electricity, and moving that electricity to load centers,” said Pius Fischer, Basin Electric Power Cooperative’s vice president of transmission, during Tuesday’s virtual hearing of the House Natural Resources Subcommittee on Energy and Mineral Resources.

“We support the role that federal lands can play in expanding the deployment of renewable energy,” Fischer said. “If beneficial electrification is the goal, driving up the cost of electricity due to increased time and costs for transmission is self-defeating.”

Fischer cited Basin’s deployment and operation of 2,500 miles of high voltage transmission and its 1,800 megawatts of owned or contracted wind power as evidence of its support for renewable energy and noted that the G&T now has approximately 300 MW of solar generation under development. He added that systemic challenges complicating transmission design and deployment could be resolved by Congress.

“The federal government should approach transmission development with a coordinated interagency approach,” Fischer said, after recounting the three years it took for Basin Electric to complete the environmental impact statement needed for an essential transmission project serving oil and gas fields in the Bakken Formation.

Fischer said meeting National Environmental Policy Act requirements can take years, in contrast with state siting requirements that can be met in a matter of four to six months. He also cited Basin’s experience with permitting challenges brought under the Endangered Species Act and the Migratory Bird Treaty Act as factors complicating vital transmission projects.

“The additional time and cost of constructing transmission on federal lands becomes a measure of last resort for electric utilities and transmission developers,” he said.

Fischer offered the committee several recommendations to minimize barriers to linking renewables with energy-hungry population centers:

• Provide clear guidance and analysis timeframes for NEPA compliance and encourage the use of categorical exclusions for projects with minimal impact.
• Provide regulatory protections for utilities engaging in lawful activities, such as power transmission for bird strikes subject to endangered species or migratory bird regulations.
• Ensure that the costs of transmission development are borne by users commensurate to the benefits from development of renewable energy projects and the transmission connecting the projects to those areas.

Derrill Holly is a staff writer for NRECA.

As electric cooperatives contend with global supply chain disruptions caused by the COVID-19 pandemic, they’re working with their suppliers, vendors and logistics providers to meet demand for parts and other key components essential to keeping power flowing.

“We’re facing long lead times for pad-mounted transformers and PVC pipe used for conduits for underground distribution,” said Tim Gibson, purchasing agent for Wauchula, Florida-based Peace River Electric Cooperative. “Digital meter availability has also been a big problem due to the worldwide shortage of microchips, so we’ve projected six-month demand and ordered them for staggered delivery to meet our needs.”

Long lead times for some parts, like polyvinyl chloride pipe and fittings, have been extended due to feed stock shortages or curtailed operations at petrochemical plants in Texas and Louisiana caused by weather or staffing challenges. Pandemic-related concerns and shipping delays have also prompted some warehouse managers to increase reserves on hand by doubling and even tripling up on their inventories.

“We’re routinely looking at the usage history of our customers so we can anticipate their actual demand for 2022 and the following year,” said Bret Curry, sales manager at Arkansas Electric Cooperatives Inc. The Little Rock-based logistics and service arm of the Arkansas statewide association serves as the principal parts and equipment supplier for about 400 utilities, including co-ops in five Mid-South states.

AECI also regularly consults with members of the Electric Utility Distribution Association, which includes nine member-owned logistics suppliers serving member-owned and public power interests. Several members of EUDA are reporting similar concerns across their client bases.

“Long lead times have caused inventory levels to fluctuate greatly—making it very hard to manage stockouts,” said Johnny Andrews, chief operating officer of Texas Electric Cooperatives’ manufacturing and distribution services division.

Among the strategies TEC has employed to address the supply shortage has been meeting demand with reconditioned equipment, like meters and transformers.

“This approach has worked extremely well for TEC due to the support of companies like Emerald Transformer and Allegiant Utility Services, which manufacturers and refurbishes meters,” said Andrews. “Both of these organizations have stock of refurbished equipment, offer product warranties that are similar or better than the original equipment manufacturers and can also refurbish and repair the co-ops’ equipment as well.”

While several EUDA members are advising clients that logistics challenges could linger well into 2023, the end of the 2021 Atlantic hurricane season may provide a bit of relief. Storm activity along the Gulf and Atlantic coasts has been less damaging than normal this year, and seasonal reserves of parts and equipment built up since the spring will begin flowing back into inventories in December.

Still, co-ops are being encouraged to work with local developers on major projects to divide larger jobs into several phases, allowing for delivery of essential parts and components over extended periods.

“The key is planning, particularly for large developments or subdivisions slated for construction over the next three to four years,” said AECI’s Curry. “Talk to your builders and developers and tell them just what we’re telling our distribution co-ops. If they tell you they need to build out infrastructure for 100 new homes tomorrow, that’s not likely to be possible in this environment, and there are no hard expectations of that improving anytime soon.”

Derrill Holly is a staff writer for NRECA.

Findings in a new study from the Massachusetts Institute of Technology about decarbonization of the electric industry are raising concerns for one electric cooperative leader about the reliability of the nation’s electricity supply.

“We are alarmed by a rush to renewables without technologies available today to ensure reliable power at affordable prices,” said David Tudor, CEO and general manager of Associated Electric Cooperative Inc., a generation and transmission cooperative headquartered in Springfield, Missouri.

“First, generation and storage technologies do not exist today to responsibly decarbonize our country 50% by 2030 and 100% by 2035. Second, the transmission system in our country will need costly and time-consuming upgrades that face significant obstacles in that timeframe.

“Our mission is to provide an affordable and reliable energy supply; that’s what our member-owners want and expect,” Tudor added. “The people who depend on electricity at the end of the line shouldn’t be forgotten as policymakers debate the impacts of these current proposals. Paying higher bills for unreliable electricity is not an outcome that benefits them or anyone else.”

The study, “Challenges and Opportunities for Decarbonizing Power Systems in the U.S. Midcontinent,” was published this month by MIT’s Center for Energy and Environmental Policy Research.

The report, which looks at transmission capacity, dispatchable generation and electricity use across 18 regions in the Midwest, comes as the Biden administration has committed to decarbonizing the nation’s power system by 2035.

“This ambitious goal will require an accelerated substitution of fossil fuel with renewable generation over the next decade,” the report states.

The study details challenges associated with early retirement of coal and natural gas generation; the impact of various renewable energy standards; and the costs and deployment rates for new and emerging renewable and energy storage technologies, among other developments.

“Our results suggest that by 2030, based on widely used price forecasts, demand projections and planned electricity resources, gas- and coal-based technologies still prevail in the system,” the report notes. However, “coal and fuel oil are expected to be displaced by wind and solar as long as decarbonization is stimulated through further policies. [Natural] gas resources are still needed to help accommodate the significant amount of renewable generation.”

More aggressive carbon policy is needed to reach the administration’s goals, which will require significant capital costs and, ultimately, agreement by a fragmented Congress.

“Policymakers need to choose among policies with an eye to these costs, and address who should pay them—taking into consideration, for example, the impact on low-income households, on industrial competitiveness, among other things,” according to the report.

AECI supplies electricity to six transmission and 51 distribution co-ops, serving 2.1 million consumer-members in Missouri, Iowa and Oklahoma. It uses a diversified portfolio of electric generation resources to meet demand, and AECI increasingly is concerned about pressures to limit or eliminate fossil fuels from that mix. “We cannot sacrifice reliable electric supply or affordable rates,” Tudor said.

He cautioned that the technical means to use renewables to meet 100% of energy demand for the studied area does not exist, and achieving that goal affordably is unlikely for several reasons. Tudor cites the pace of technology development; the current and projected condition and deployment of transmission assets; and the timeframe outlined in public policy initiatives among the disruptive impacts of rapid decarbonization.

“Development that maintains reliable and affordable energy and the ability to move large volumes of renewable energy via transmission system investments will take significant time,” said Tudor.

Derrill Holly is a staff writer for NRECA.

The U.S. Department of Agriculture has approved $598 million in loans for 11 projects, most of them at electric cooperatives, to improve and modernize rural electric infrastructure for delivery of affordable, reliable power to thousands of residential, commercial and agricultural consumers.

Low-interest loans will go to nine co-ops across the country, in addition to the Navajo Tribal Authority in Arizona and ASP2 Rural LLC in Maine. About 460,000 rural residents and businesses will benefit from this round of funding.

Several loans will help expand smart grid technologies, “a catalyst for broadband and other telecommunications services in unserved and underserved rural areas,” the USDA said in its March 16 announcement.

“Now is the time for our nation to make significant investments in infrastructure—roads, bridges, broadband and energy—to improve quality of life and support good-paying jobs, transition to a clean energy economy, and keep the United States poised to lead the global economy,” said Agriculture Secretary Tom Vilsack.

Minnkota Power Cooperative, headquartered in Grand Forks, North Dakota, will receive about $80.5 million in loans to fund 98 generation and power delivery projects, specifically rebuilding power lines and substations and upgrading aging infrastructure.

“We have power lines and substations on our system today in very rural areas that are in some cases 50 to 60 years old,” said Ben Fladhammer, the director of communications for the generation and transmission co-op, which serves 11 member co-ops spread throughout 35,000 square miles in eastern North Dakota and southwestern Minnesota.

“We’ve reached a point where those resources have served us well, but it’s time for us to rebuild or replace them and integrate new technologies and really position our area and our system for the future.”

Smart technologies will modernize many of those substations, Fladhammer noted. “We will have access to more data in the field so that when we go out into our service territory for an issue we will know ahead of time where to start.” 

In Missouri, Intercounty Electric Cooperative Association received a $15 million loan, which it will reinvest in its system for maintenance and upgrades over the next five years. The loan includes $432,000 in smart grid technologies.

“The availability of these loan funds lowers the required amount needed from co-op members through electric rates,” said Heather Satterfield, director of communications at the Licking-based co-op.

Victoria A. Rocha is a staff writer at NRECA.

More than two dozen utility executives, including leaders of two electric cooperatives, testified at two marathon hearings in the Texas legislature last week to examine what went wrong during a February cold snap that paralyzed the state’s electric grid and left millions without power for days.

Residents of hundreds of Texas communities are still struggling to recover two weeks after one of the longest and most widespread power outages in the state’s history, and lawmakers are demanding assurances that the problems never happen again.

“This is the largest train wreck in the history of deregulated electricity,” said state Sen. Brandon Creighton of Conroe.

During the Feb. 13-19 event, Texas’ electric grid was impaired by the loss of generation from wind and solar energy, coal, natural gas and nuclear sources. Just under half of the state’s electric generation sources were offline at one point during the week.  

“When you lose almost half your generation, you are going to have a problem,” Bill Magness, president and CEO of the Electric Reliability Council of Texas, told a state Senate committee last Thursday.

ERCOT is the grid operator overseeing the generation and transmission assets of dozens of utilities in the state, including electric co-ops. Collectively, those utilities serve 26 million Texans in 70% of the state’s territory. Of the 620 generation units on the ERCOT system, at least 185 reported problems.

A combination of ice storms, subfreezing temperatures, mechanical failures, fuel challenges, stakeholder miscommunications and unprecedented demand compromised grid stability and left 4 million consumers without power. Had demand been allowed to outpace the available generation, damage to power plants, substations and other assets would have been extensive.

“We never want to black out the system, so that’s the problem, and there’s nobody that wants to solve it more than me,” Magness said Feb. 25 during a grueling and often contentious 10-hour committee hearing.

During the emergency, ERCOT called on transmission operators to implement controlled outages to prevent catastrophic failures.

“Even though we had sufficient generation to meet the needs of our members, we had to shed load like any other transmission provider,” said Mike Kezar, CEO of South Texas Electric Cooperative, a G&T owned by eight distribution co-ops.

STEC’s five power plants, two wind farms and a pair of hydroelectric facilities, owned or under contract, performed well throughout the emergency, he said. But the G&T’s transmission was still subject to ERCOT-ordered cyclical power interruptions, which averaged 3.5 hours each.

The loss of generation, particularly from natural gas pipeline failures and curtailments of industrial generation sources, prompted ERCOT to activate a $9,000-per-megawatt-hour price cap mandated by the Texas Public Utility Commission. The typical cost of power on the ERCOT grid is around $26 per MWh.

Similar control measures have been used previously for short periods of time to help manage peak summer demand costs, but extended application of the capped rate is unprecedented.

A $2.1 billion February power bill forced Waco-based Brazos Electric Power Cooperative to file Chapter 11 bankruptcy on March 1, citing the need to insulate its 16 distribution co-ops and their members from “unaffordable electric bills,” said CEO Clifton Karnei in a statement.

“This court-supervised process will provide us with the protections and mechanism to protect and preserve our assets and operations and satisfy obligations to our creditors,” he said.

Amarillo-based Golden Spread Electric Cooperative belongs to both ERCOT and the Southwest Power Pool and saw costs balloon in both power markets during the cold weather event.

“Estimates are that the power bill for the month of February 2021 will exceed the cost of power paid in previous years,” said D’Ann Allen, the G&T’s manager of member relations. “Whatever Golden Spread’s share of that expense is will be high and, unfortunately, borne by our members.”

Allen said the co-op is working with its board to determine how to soften the blow for member co-ops. “More than likely, it will take years,” she said.

Some Texas co-ops are adopting measures to ease the impact on consumers, including suspending late fees and disconnects for non-payment, relaxing deposit requirements, offering deferred payment plans and delaying planned electricity rate changes that were scheduled to go into effect this spring.

Derrill Holly is a staff writer at NRECA.

Massive storms can ravage the electric grid, leaving tens of thousands of utility meters stalled until distribution systems are repaired. But the damage caused to transmission systems can present far different challenges for the people who restore power.

That’s why more than two weeks after Hurricane Laura made landfall on the Louisiana coast, two electric cooperatives are still telling members they may not have power fully restored for weeks.

The investor-owned utilities that control transmission assets in western Louisiana began damage assessments and the process of rebuilding their systems within hours after Laura came ashore on Aug. 27 near Cameron. 

While the Louisiana distribution co-ops are not involved in rebuilding the regional transmission system, two generation and transmission cooperatives have had recent experiences with widespread damage, prompting emergency system reconstruction well beyond the scope of routine storm repairs.

When a derecho swept across the Midwest on Aug. 10, Central Iowa Power Cooperative reported outages affecting 58,000 homes and businesses. The storm’s 130-mph winds cut a path of destruction across the state estimated at 70 miles wide and 200 miles long.

“We found miles of line strewn over highways and pole after pole blocking roads,” said Dan Burns, vice president of utility operations for the Cedar Rapids-based G&T. “You couldn’t get trucks in to begin rebuilding the lines, so the first thing we had to do was clear all of that out.”

About 600 of CIPCO’s transmission structures were knocked down, said Burns. “We had damaged infrastructure in 11 counties, and more than 100 of our member co-ops’ distribution substations were offline.”

The damage was comparable to losses experienced by Andalusia, Alabama-based PowerSouth Energy Cooperative during Hurricane Michael. The G&T lost 264 transmission structures after Michael made landfall as a Category 5 storm on the Florida Panhandle in 2018.

“Michael came through the Panama City area, and the devastation was complete,” said Gary Smith, PowerSouth’s president and CEO. “The path of destruction was about 60 miles wide, centered right at Tyndall Air Force Base, and extended about 120 miles deep.”

Specialized Help

The electric power grid is a sophisticated system of complex parts, deployed and installed over many decades.

The basic parts include generation assets like power plants, solar arrays and wind farms; transmission systems that carry high-voltage electricity along conductors supported by tall poles, steel towers or wood-framed structures; and distribution systems that include substations that reduce and divide high-voltage electricity into lower-voltage amounts to safely distribute power to homes, farms and businesses.  

Each element of the grid requires personnel with specific skills. Those involved in building, repairing and maintaining them have their own work procedures, as well as specialized tools, vehicles and equipment.

That can become particularly challenging when major disruptions prompt emergency rebuilds. The pool of available workers who can safely and quickly respond to a transmission provider’s needs is relatively small compared to those trained to help a distribution operator.

“Our guys work on high-voltage lines, and they do it a certain way,” said Smith. “There are not a lot of co-ops in our region of the country that build and maintain their own transmission, so we got help from Cooperative Energy, a G&T out of Hattiesburg, Mississippi, and we used contractors.”

PowerSouth divided personnel so that a representative of the G&T, familiar with its systems and procedures, was paired with each contract or mutual aid crew.

With 20% of PowerSouth’s transmission system down, it quickly became clear that damaged segments could be rebuilt faster than they could be repaired.

“With a normal storm, like a tornado, you can straighten structures, replace cross arms and straighten and rehang conductor and keep moving,” said Smith. “This was all destroyed, so we just rolled it up and put everything back new. That made it a total rebuild.”

CIPCO was in a position to harness more mutual aid when the derecho tore through Iowa, so when preliminary damage assessments turned up widespread problems, CEO William Cherrier contacted his counterparts at four other G&Ts to begin coordinating a collective response.

Iowa’s Corn Belt Power Cooperative and Northwest Iowa Power Cooperative, Northeast Missouri Electric Power Cooperative and Wisconsin’s Dairyland Power Cooperative were happy to help.

“We had not called for mutual aid help before, and we were wondering exactly how that worked as far as having agreements and such, but that turned out to be the easiest part of the entire event,” Burns said. “We just called them and said we need help, and they came, with crews, trucks and any materials they had on hand. By the time they got here, we knew where we needed them most. But the hours required for an emergency rebuild when everybody’s power is out can be tough on crews. They worked 16 to 17 hours a day for 12 days in a row, which is far more intense than a normal rebuild.”

Managing Movements and Many Parts

Big projects always require a lot of planning, and when that’s undertaken in response to major system failures, engineers and logistics planners look for ways to quickly meet the challenges.

“The first three days are complete chaos, and then things start coming together,” recalled Smith, describing the rebuild required after Hurricane Michael.  “There are photos and mapping data gathered from helicopter and drone flyovers to analyze, parts inventories to compile and review, basecamp locations to plot, and lodging and meal services to arrange.”

“You are always prepared for the smaller repair jobs, but you are never fully prepared when systems have to be totally rebuilt,” said Smith.

To expedite restoration, work plans are plotted to allow reconnection to less damaged sections of the grid that often restore service to the most densely populated areas.

“When your crews and contractors get stretched out, they’re moving quickly and putting up a number of structures simultaneously,” said Smith. “You’ll have two or three crews on the same line working on structures. When they get finished, they’ll leapfrog, often moving right behind the crews laying out the matting and cribbing needed to support heavy equipment in wet cross-country areas.”

Keeping those crews moving requires a supply chain designed to work with military precision.  That means starting with what’s on hand and then identifying sources that can guarantee fast resupply and delivery to temporary yards often set up at 50-mile intervals.

“We had some planned rebuild projects that were just about to begin construction, and so we robbed a lot of that material,” said Burns, recalling the first few days following Iowa’s derecho.

CIPCO’s vendor management team contacted suppliers, who shipped more poles, insulators and other components. But, at times, there never seemed to be enough.

“We ran short on most materials, because our needs were 10 times greater than the inventory we had,” said Burns. “On a normal planned rebuild, you know from the plan and profile designs the exact quantities needed of each pole class and length. In an emergency response situation, you need to expedite delivery of poles, and you can’t always be specific. You often shoot from the hip just to keep the rebuild going.”

CIPCO restored transmission service to all distribution substations within 12 days of the derecho, but crews will be involved in follow-up work for months. 

Emergency rebuilds present ongoing maintenance challenges that can impact operations for years. New parts and poles are comingled with assets deployed decades ago, and all the changes and updates must be noted and confirmed in the transmission asset database. More visual inspections than would take place under a scheduled rebuild may also be needed.

“We decided to defer some things in order to get power back on as quickly as possible,” said Burns. “For example, we put up the poles, insulators and conductor, but we decided to defer the pole grounds until a later date. That sped up restoration time considerably. Now that the system is back to normal, we can go back and install them without interrupting service to members.”

Just as every storm presents unique challenges, emergency rebuilds are seldom routine.

“You cannot comprehend the devastation and the chaos,” said Smith. “I’ve been CEO 21 years and, for me, Michael was the worst storm we have seen, and you’re never prepared for your worst storm.”

Derrill Holly is a staff writer at NRECA.

Second of two articles. Read Co-op Voices, Part 1

America’s national pastime has been benched by COVID-19, and the boys—and girls—of summer won’t be coming to play baseball in Cooperstown.  

That’s bad news for members of Otsego Electric Cooperative, who rely on money from renting out their homes to tens of thousands of visitors gathered to watch the annual Baseball Hall of Fame induction and the youth baseball camp games that take place nearby all summer.

With retired Yankee great Derek Jeter scheduled to be inducted in July, about 100,000 visitors had been expected to pour into the upstate New York area. But the event—and most of the camps—were canceled because of the pandemic, costing the region at least $20 million to $30 million in estimated lost revenue, said Tim Johnson, CEO of the Hartwick-based co-op.

“Some of our members live on money from those summer rentals all year long,” Johnson said. “Now that’s gone.”

The coronavirus is affecting not-for-profit electric co-ops and their members differently. Some co-ops, especially those in areas that depend on agriculture, oil or manufacturing, are already facing severe budget shortfalls from falling electricity sales and members’ inability to pay their bills. Others, like Otsego, could be hit hard this summer as tourism plummets amid COVID-19 travel restrictions and cancellations.

NRECA and its member co-ops have launched a grassroots campaign to urge Congress to provide a financial safety net for struggling co-ops and their members as lawmakers negotiate the latest coronavirus relief bill.

Here’s a sampling of what co-ops are facing:

Tourism Losses

Falling tourism is also a problem in Walla Walla, Washington, where wineries, hotels, resorts and restaurants are suffering and about 2,000 jobs have been lost, said Scott Peters, CEO of Columbia Rural Electric Association.

“In April, every hotel would have been filled and all the restaurants would have been booked for wine weekends,” Peters said. “Instead, it was a ghost town.”

The co-op is getting calls from members who have lost their jobs and are asking for help because they don’t have enough money to pay their monthly bills, he said.

“We’re going to have members who aren’t going to be able to dig out of the hole they find themselves in,” Peters said. “I just think Congress is going to have to come up with some kind of needs-based bailout. Co-ops still have to pay our bills, even when our members can’t pay theirs.”

Oil Slump

In Oklahoma, Kiamichi Electric Cooperative CEO Brett Orme says he’s concerned that the declining demand for oil and gas during the pandemic could hurt the co-op’s wholesale power provider by reducing its sales, which could in turn raise prices for the co-op to buy power. The cost of purchasing power represents 60% of the Wilburton-based co-op’s costs, Orme said.

“This could ultimately result in higher energy rates for Kiamichi Electric members who are already suffering from this pandemic,” he said.

In Wyoming, High West Energy has also been affected by the oil industry slump. The co-op’s biggest account, Whiting Petroleum, filed for Chapter 11 bankruptcy protection in April, and the co-op is working with the bankruptcy court to ensure that Whiting will still pay its electric bills. The oil company accounts for more than 10% of the co-op’s annual revenues, said Brian Heithoff, CEO and general manager of the Pine Bluffs-based co-op.

“My fear is that this is a longer-term issue,” he said. “If there is a second or third wave of coronavirus, it could be a permanent loss of oil-related load for us.”

Farm Woes

Corn growers whose crops go to make ethanol are also hurting from depressed oil prices, said Bob Hunzinger, president and CEO of Eastern Illini Electric Cooperative.

Hog producers, who are among the Paxton, Illinois-based co-op’s biggest customers, are having trouble getting the animals to market because of supply-chain breakdowns and may have to euthanize them.

Members whose electric bills were 60 days past due were up 68% from March to April while members whose accounts were 90 days past due were up 50%, Hunzinger said.

“We expect those increases will likely continue,” he said. “We just don’t know how long it will last.”

Manufacturing Declines

At Oregon Trail Electric Cooperative, there are 10 times the normal rate of payment collections as members struggle to pay their bills. Like most co-ops, eastern Oregon-based OTEC has suspended disconnections and late fees during the pandemic, said CEO Les Penning.

Electric sales to local industries have fallen about 20%, Penning said. Eastern Oregon’s timber industry had already suffered decades of decline when the pandemic struck and caused more harm. Regional manufacturing also has been impacted. A local recreational vehicle and camper manufacturer reported decreased production due to supply chain delays and social distancing requirements in the workplace. However, sales have been strong with more people planning to travel within the region after the pandemic.

“I just hope they can ride this out and we as a community can recover stronger than ever,” Penning said.

Poverty Getting Worse

In the Southern California desert, Anza Electric Cooperative serves an area that suffered from high poverty and unemployment even before the pandemic. In the past couple of months, members have increasingly struggled to pay their bills, said Kevin Short, the co-op’s general manager.

Electric sales have also dropped as schools closed early, the nearby casino temporarily shut down, and the opening of a new hotel was put on hold.

Co-ops have kept the lights on during the pandemic, and they’re going to need assistance from the federal government going forward, Short said.

“My message to Congress would be to please put the partisan bickering aside and help people.”

Erin Kelly is a staff writer at NRECA.

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Read More on the electric co-op response to the COVID-19 Pandemic

NRECA CEO Jim Matheson told a House Energy and Commerce subcommittee on Wednesday that diversity of electric generation options, including baseload sources, is essential to meeting co-op members’ expectations in a carbon-constrained economy.

Electric co-op members can ill afford energy cost increases during the transition to a lower carbon electric portfolio, Matheson said. That and other factors “make it especially important for co-ops to keep electric rates affordable, maintain reliability and improve sustainability as they explore all ideas to meet the evolving energy needs of their communities.”

Matheson urged lawmakers to recognize that co-ops need a diverse mix of fuels—including coal and natural gas—to provide affordable electricity to rural communities in high-poverty areas. “Knowing that both coal and natural gas will continue to play an important role in providing affordable and reliability electricity in a carbon-constrained future, electric co-ops are actively engaged in carbon capture research and development,” he said.

Testifying before the committee on which he served for eight years, Matheson discussed steps that electric co-ops have taken to expand and diversify their generation portfolios. From 2009 to 2016, the share of renewable energy that electric co-ops provided to their members increased from 13% to 17%.

Carbon dioxide emissions from cooperative-owned generating facilities dropped 12% from 2005 to 2017 as they increased energy efficiency and replaced some coal-fired power plants with lower-emitting natural gas plants or renewable energy, he said. Co-ops’ solar capacity alone has more than quadrupled since 2016.

“Every cooperative’s resource mix is unique to the needs of that co-op and will continue to vary greatly depending on existing resources and assets, the impact on electricity costs for its member-consumers, reliability implications, and the availability of alternative electric generation,” he said.

Matheson was one of six witnesses testifying at a hearing titled “Building a 100 Percent Clean Economy: Solutions for the U.S. Power Sector.” The power sector produces about 28% of America’s total greenhouse gas emissions, making it the second-largest source after the transportation sector, committee leaders said.

Committee Democrats announced in July that they want to pursue legislation to zero-out all carbon dioxide emissions from the U.S. economy by 2050.

Matheson noted that the Department of Energy recently chose NRECA—in partnership with the Pacific Northwest National Laboratory—to research small-scale, community-based wind energy solutions that can be deployed by co-ops.

“Interest among electric co-ops in deploying energy storage is also growing and should accelerate as more experience is gained, costs decline, and battery performance improves,” Matheson said. “Hydropower and nuclear energy also remain an essential source of zero-emission generation for electric cooperatives in certain regions.”

Forcing co-ops to prematurely shut down coal-fired plants or natural-gas facilities would raise rates for consumer-members, many of whom can’t afford to pay more, he said.

Matheson encouraged lawmakers to visit their local co-ops to better understand their unique situations.

“A technology, program or policy that works for one co-op might not work for another,” he said. “Having the flexibility to implement energy solutions across the many regions where cooperatives serve is a critical factor today and for the future of our members.”

Matheson urged lawmakers to “ensure that any proposals that this committee considers provide long-term certainty and flexibility that maintains energy diversity for electric co-ops, supports reliability of the electric grid and minimizes undue harm for consumers.”

ARLINGTON, Va.—Lawmakers should consider the needs of electric cooperative members when exploring ways to continue reducing power plant emissions, NRECA CEO Jim Matheson told the House Energy & Commerce Committee’s Energy Subcommittee today.

“America’s electric co-ops are engines of economic development focused on responsibly delivering affordable, reliable electricity in communities across the nation,” Matheson said. “Diversity of electric generation, including baseload sources, is essential to meeting co-op members’ expectations. Consistent with that approach, electric co-ops thoughtfully explore all ideas that promote these core principles as they work to meet the evolving energy needs of their local communities.”

Electric co-ops have and will continue to diversify their energy portfolios, with a majority of their power now coming from low and no-emission resources. Moreover, by electrifying processes in other sectors of our economy, the electric sector can help reduce emissions across the entire economy.

“Having the flexibility to implement energy solutions across the many regions where cooperatives serve is a critical factor today and for the future of our members,” Matheson said. “Electric co-ops have invested in a variety of measures to reduce emissions, such as renewable sources, energy efficiency, storage options, and research on carbon capture technologies.”

Matheson stressed that every cooperative’s resource mix is different and will continue to vary greatly depending on existing energy resources and assets, the impact on energy costs for member-consumers, reliability implications, geographic location, and other local circumstances.

“Policymakers should be mindful of this and ensure that any energy policy proposals provide long-term certainty and flexibility that maintains energy diversity for electric co-ops, protects reliability of the electric grid, and minimizes undue economic impacts for consumers – especially those in rural and persistently poor communities,” Matheson said.

Matheson’s written testimony to the committee is available here.

The National Rural Electric Cooperative Association is the national trade association representing more than 900 local electric cooperatives. From growing suburbs to remote farming communities, electric co-ops serve as engines of economic development for 42 million Americans across 56 percent of the nation’s landscape. As local businesses built by the consumers they serve, electric cooperatives have meaningful ties to rural America and invest $12 billion annually in their communities.

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