Vernon Electric: Our Cooperative

To All Ratepayers of Vernon Electric Cooperative:

This is the first in a series of informative newsletters produced by Dena Eakles for Echo Valley Hope. The intention is to increase awareness and involvement with our energy cooperative.

As a cooperative member you are one of 10,000 voices that can steer the direction of Vernon Electric Cooperative, VEC.  

Our History: On May 11, 1935, Roosevelt signed an Executive Order establishing the Rural Electrification Administration (REA). A year later the Rural Electrification Act was passed and the lending program that became the REA began. It soon became evident that investor-owned utilities were not going to use the federal loan funds available to serve the more sparely populated rural areas. However loan applications from farmer-based cooperatives poured in, and electric cooperatives made rural electrification a reality. In 1937, the REA drafted the Electric Cooperative Corporation Act, enabling the formation and operation of not-for-profit, consumer-owned electric cooperatives. That included VEC.

In general Cooperative Members maintain equal status, work together for the good of the community and follow seven guiding principles:  Voluntary and open membership; Democratic member control; Member economic participation; Autonomy and independence; Education, training, and information; Cooperation among cooperatives; and Concern for community.

From the VEC website, https://www.vernonelectric.org    “Cooperatives are democratic organizations controlled by their members, who actively participate in setting policies and making decisions. The elected representatives are accountable to the membership. In primary cooperatives, members have equal voting rights (one member, one vote) and cooperatives at other levels are organized in a democratic manner.  Cooperatives are autonomous, self-help organizations controlled by their members. If they enter into agreements with other organizations, including governments, or raise capital from external sources, they do so on terms that ensure democratic control by their members and maintain their cooperative autonomy.”

At the annual meeting in April of this year, members passed a resolution asking for a cost benefit analysis of locally sourced energy (solar, wind, etc.), which retains the revenue in Vernon County versus outside developers, which tend to pull finances away from our area. This was a step towards more transparency. It remains up to each of us to ensure our cooperative is working in the best interest for the “common good” of every member.

Question to ponder and to ask: How has VEC demonstrated willingness to comply with the resolution passed in April 2022?

#2 Dairyland Power

The energy VEC utilizes comes from Dairyland Power Cooperative. https://www.dairylandpower.com

Dairyland Power, a Touchstone energy Cooperative https://www.touchstoneenergy.com, was formed in 1941 and is headquartered in La Crosse. It is a generation and transmission (G&T) cooperative and provides electricity to 24 distribution cooperatives and 17 municipal utilities. These cooperatives include VEC.

Dairyland Power Cooperative gets 50% to 75% of its energy from carbon fuel sources like coal or natural gas. It owns and operates several power plants utilizing hydroelectric, natural gas, coal, landfill gas and solar generation.

Dairyland’s coal plants are due to be retired as the move away from carbon fuel sources continues and the move towards renewables escalates.

Questions to ponder and to ask: In the retiring of carbon fuel generation power plants, how do power plants become “stranded assets”?  “Stranded assets are assets that have suffered from unanticipated or premature write-downs, devaluations or conversion to liabilities”. Wikipedia

How do stranded assets impact electric cooperative members?

Dairyland’s current generation plants that rely on carbon fuel sources are also exposed to fuel price fluctuations. When our electric bills show power cost adjustments that means an extra charge due to higher fuel prices. These costs emerge when liquefied natural gas is exported (or transmitted to other regions by MISO https://www.misoenergy.org) from climactic extremes such as severe heat as well as man-made disasters such as war.

Solar generation does not have this rate volatility. In 2021 Dairyland Power’s Renewable sources were: 25% (This number is disputed by solar enthusiasts)

Community and Local PPA (Power Purchase Agreement) Solar Projects: 0.42%

Member-Owned Solar:  0.33% (these numbers came from VEC Dir. Of Member Services Dave Maxwell)

The desire for home or community solar or off grid generation is on the rise. The Inflation Reduction Act offers tremendous savings to individuals and businesses seeking to reduce energy costs.  The value of locally generated energy both as national security as well as local economic viability is becoming clearer.

Question to ponder and to ask:
As solar and energy storage continues to become more affordable how is Vernon Electric Cooperative supporting members’ move to renewables?

#3 WECA and the PSC

And you thought this was going to be easy. There are organizations and regulatory bodies that impact our membership with our coop, VEC. Currently there is a question before the PSC asking for a “declaratory ruling related to third-party financed distributed energy resources (DER)”. Organizations like the Midwest Renewable Energy Association and Vote Solar are asking for the ruling in order to clarify what has become a stumbling block for third-party financed solar. Let’s break this down.

Third party ownership (TPO) is a business arrangement allowing renewable energy generating equipment to be financed, owned or leased to a property owner or occupant in order to fulfill energy needs. This is an important option for those who cannot personally finance the leap to solar.  The TPO systems remain tied to the grid, follow the same guidelines yet offer a financial break from traditional energy sources.

At this time, as we move away from costly coal powered energy, TPO’s offer another possibility to help this transition.  

What is the PSC? From their website at https://psc.wi.gov/Pages/AboutPSC/HistoryAndMission.aspx

The Public Service Commission of Wisconsin (PSC) is a regulatory authority established by the 1907 Public Utilities Law, making Wisconsin one of the first states to regulate public utilities.​ The PSC of Wisconsin “ensures safe, reliable, affordable, and environmentally responsible utility services and equitable access to telecommunications and broadband services.” 

The request to the PSC for a declaratory ruling has resistance from VEC through WECA. The Wisconsin Electric Cooperative Association is an advocacy organization of which Vernon Electric Cooperative is a member. From their website: “The highest-priority activities of WECA entail advocacy on behalf of its member cooperatives in legislative, regulatory, and other public policy forums at every level.” https://www.weca.coop/advocacy

The current debate centers on whether third-party financed (solar and renewable energy) installers are sidestepping public utilities. The concern being raised by WECA on behalf of VEC is the need to “protect” consumers. But protections for consumers already exist. WECA’s arguments do not protect the members of VEC, but rather they are based in preserving the economic structure of the utility that VEC is harnessed to, Dairyland Power. Question to ponder and to ask: When third party developers from outside Wisconsin build large scale solar arrays for utilities, do VEC members receive financial benefit or financial burden?

This question was the basis for the resolution passed by VEC membership in April 2022. The request was for cost–benefit analysis of these large-scale systems versus more locally generated systems. The membership is still awaiting cost-benefit analysis from VEC. The burden of cost for third party renewables for a utility is shared by all of us. When TPO’s form a financial relationship with an individual or group, there is no cost to VEC members. 

Suffice it to say, the news we receive with our monthly electric bills only reveal the tip of the iceberg. It’s time to pay attention.

You can find WECA’s argument at https://wecnmagazine.com/article/the-rising-threat-of-unregulated-third-party-ownership/

You can find the testimony of Corey Singletary on behalf of the Citizens Utility Board to the PSC (in favor of allowing TPO’s) here https://apps.psc.wi.gov/ERF/ERFview/viewdoc.aspx?docid=447477

#4   How Does VEC Run? 

As a member of Vernon Electric Cooperative you are an investor with capitol credits attributed to you and as such you have a legal say in how your coop is run. Question to ask and ponder: How does VEC run?

A ten-member board of directors meets monthly to conduct the business affairs of the cooperative.  One director is elected from each of the ten geographic divisions that comprise the Vernon Electric Co-op service territory.  Directors are elected to serve three-year terms.  The terms are staggered. To view the ten directors of the board you can visit: https://www.vernonelectric.org/district-committee-conference

The planning and decisions made by the board affect all of us, from our pocket books to our safety. Decisions being made today must include future environmental and transmission impacts as well as waste, from wasted energy to wasted dollars. 

Questions to ponder and to ask: How can I ensure the board is acting on my best interest and the best interest of other members? How can I become more informed? How can we, the 10,000 members of VEC, ensure transparency?    

Can you as a member attend the board meetings? Yes and no.  Meetings are not open. You can request to speak before the board and once you have spoken, you are dismissed.

To access the minutes of the meetings you must have access to a computer, the Internet, and follow these steps: Go to VEC website https://www.vernonelectric.org/; Click on My Account (SmartHub); Set up an account and/ or Log in with your credentials; Go to My Profile tab at the top and click “documents” in the drop down menu. Scroll through to find the recent board minutes. This is a tall order for those without computers or Internet access. 

Questions to ponder and to ask: Why are board minutes not more readily accessible? Important information is being debated and decisions are made without the spirit of informed consensus, which is the basis of cooperatives.

What can we do to receive board minutes in more ready fashion and in a more timely way? 

The next Annual Meeting will be Saturday, March 25, 2023. At that time members will be allowed to vote on issues and resolutions made prior to that meeting. This is an important date for all VEC members who choose to direct the course of the cooperative. It is possible that bylaw changes will be made and voted on. Stay tuned. You can watch the April 2022 Annual Meeting here: https://krm.vo.llnwd.net/perigonrecordings/ev12-standard/d83ad869-5bc6-40e7-b931-1facf55acf19/557_557_20220326140013403.ts.mp4

Another important date is the District Committee Conference on Saturday, February 11, 2023 when two candidates from each of the ten divisions are selected. A petition of fifteen or more can also select candidates to be nominated. See you there!

#5 Transitioning to Renewables

Fossil fuels have been king for so long, it’s hard to remember a time we were not powered by oil, natural gas and nuclear. The choices were made to generate power through oil and gas extraction and no attempt was made to offset the disastrous impacts to the health of the planet or to its inhabitants. The call to move away from the use of fossil fuels was sounded in the ‘80’s by the Carter administration, but the industries that produce these forms of energy refused to listen then and are taking their sweet time now. Today we are witness to climatic volatility and polluted water and toxic air to an alarming degree. Ask yourself how is your health and the health of your loved ones? How is the health of your air and your soil? Have we benefitted from the use of fossil fuels or have we been cutting the branch that we sit upon? 

I grew up in western Pennsylvania, where coal mining was the staple and led to the discovery of oil from the seepage of coalmines in 1847. Energy jobs have come and gone from the area, while industry triggered diseases have increased. Now an ethane “cracker” plant has been built on the shore of the Ohio River. This plant will increase the mining of local Marcellus shale for natural gas in order to maintain the plant’s production of petrochemicals. It is also speculated that the whole of it will decrease the health of residents through toxic air and water. 

Its time we look at the long-term costs of fossil fuels and recognize that reduced consumption and the transition to renewable forms of energy is not a luxury, it is essential. For the most part we have ignored the details of how and where are energy comes from, content to have it and the rest be damned. If we truly care about future generations, perhaps it is time we become knowledgeable and empowered to make the best decisions for all of us, including our children.

The recent Inflation Reduction Act is not a panacea, but it does offer monetary incentives to benefit individuals as they transition to a more renewable lifestyle.

This may be of help to those considering renewables: https://www.rewiringamerica.org

Vernon Electric Cooperative currently relies on 12% of renewable energy through Dairyland Power. There are also VEC offerings to help offset fossil fuels. These include: options to buy into the Community Solar Farm run by VEC; another buy in program called Evergreen; and the option to create your own renewable energy (individually or in community) known as Distributed Generation. https://vernonelectric.org/renewables

And of course there is the need to reduce consumption. Focus on Energy is a statewide program that promotes energy saving projects and products. https://focusonenergy.com

VEC offers programs of using energy at off-peak times https://vernonelectric.org/peak-heatingev-charging. Using electricity in the early morning or late at night may reduce your costs but if you are serious about the transition from fossil fuels, it is significant to note that when we use electricity after the sun goes down we are accessing coal-fired energy. For this reason ramping up individual or community renewables and energy storage is the way to reduce our fossil fuel use. Perhaps VEC could find more ways to incentivize individuals who move towards renewables and storage, as we transition from fossil fuels.  

In the next article I will offer organizations and associations that can help us learn about energy, this important transition to renewables and ways to become more empowered as citizens of the earth.

Thank you for reading and please share.