Rural Electric Cooperatives

There are three types of electric service providers in South Dakota: investor own utilities (IOUs), municipal electrics, and rural electric cooperatives. The PUC has significant regulatory authority relating to IOUs.  PUC authority for municipals and rural cooperatives is limited to service quality and territory boundary issues.  In municipalities the governing body or an appointed utility board manages the electric service.  Rural electric cooperatives are owned and managed by their customer members.  Management is structured through a board of directors elected by the membership which then hires a general manager to oversee day-to-day operations.

Even though the PUC has a limited role with rural cooperatives, we strive to maintain good lines of communication so that the PUC understands the challenges and current issues in “co-op land” and so that we can work together on issues that IOUs, municipals, and rural electrics have in common.

Each rural cooperative has an annual meeting of the membership to conduct the official business of the cooperative and elect board members. Recently Central Electric which serves portions of Aurora, Brule, Buffalo, Davison, Hanson, Jerauld, Miner, and Sanborn Counties had their annual meeting at the Corn Palace in Mitchell.  I was invited to speak to the 600 plus members who assembled for an evening meal and meeting.

The issue of greatest concern to the co-op members that night was the financial impact of the EPA’s Clean Power Plan to regulate carbon dioxide emitted from electric generation facilities. Their estimates project a possible 40% increase in the cost of wholesale power to comply with the rule.  I shared with the group the PUC’s concern about the impacts of the rule which will ultimately pit IOU consumers against rural electric consumers for who will be forced to pay the largest increases in their electric bills.  While this rule is currently held up due to legal challenges, should any part of it ultimately survive and go into effect, I will continue to work to moderate the impact on South Dakota electricity consumers.