electric cooperative

Alabama Rural Electric Cooperative Scorecard

Rural electric cooperatives (RECs) were established in the 1930s to provide power rural areas not seen as profitable to large investor-owned utilities. In Alabama there are 22 rural electric cooperatives (RECs) providing power to over a quarter of Alabama residents (and over 70% of Alabama’s land mass).

Rural electric cooperatives are member-owned (ie. customer owned), and return excess profits to the members. As such, members have certain rights to transparency and equity; to be able to attend board meetings and have input into the decisions the board is making on their behalf.

In addition to understanding their rights, members need to be able to see that their co-op is serving them well. It’s easy to say you are satisfied with your service when you have nothing to compare that service to. That’s where the Alabama REC Scorecard comes in.

Our team has evaluated all 22 Alabama RECs and scored them on over 40 different variables across three key areas. These scores allow you to do a side-by-side comparison of your REC with others in the state (or even those in other states), to see how what you have now compares to what you could have.

Of course, it’s not that simple. We spent months reaching out to every Alabama REC, with too many refusing to answer our questions or even return our many calls and emails. Many of these same RECs offer little to no information online for their members, making it even more difficult to properly assess them.

Three key areas evaluated

Democratic governance includes the ability for members to access bylaws, attend board meetings, vote on bylaw amendments, and generally have a say in the way the cooperative is run.

Financial Transparency & Compensation include things like the number of board members, CEO/board compensation, ratio of CEO salary to median household income.

Member programs include things like on-bill financing, energy efficiency financing programs, community solar, and broadband internet.

 

Summary of Alabama REC Scores:

Only 18% of Alabama RECs regularly inform their members of the date and time of upcoming board meetings.

64% of Alabama RECs allow members to attend and address board meetings.

No Alabama RECs ensure that all members have access to (via website, mail, or other means) their incorporation documents, bylaws, meeting minutes, IRS compensation forms, general financial and operational data, and strategic plan summary.

Only half of Alabama RECs have their bylaws published on their website. This lack of access to cooperative bylaws significantly reduces the ability of members to participate in the cooperative’s electoral process, engage in the bylaw amendment process, and hold their co-op accountable for possible corruption or misconduct.

Alabama Rural Electric Cooperative Scorecard author Q&A

Alabama Rural Electric Cooperative Scorecard author Q&A

Individual Alabama Coop Scores

Arab Electric Cooperative (AEC) seems to be making efforts to increase the ability for member-owners to understand and participate in the decision-making process. They are one of only four RECs that provide meeting minutes on their website, and one of only two co-ops that has the right for members to attend board meetings (without prior written approval) written into the bylaws. AEC is the only co-op in Alabama to have term limits for board members. In August 2020, amidst the Coronavirus pandemic, AEC proposed a bylaw amendment to eliminate mail-in voting.
Overall score: 43/122

Arab Electric Cooperative is the only co-op in Alabama to have term limits for board members

Baldwin EMC
Overall score: 24/122

Black Warrior EMC 
Overall score: 30/122

Central Alabama Electric Cooperative held virtual meetings with sign-language interpretation during Covid-19 to ensure accessibility. At least half of current board members were appointed rather than elected.
Overall score: 39/122

Cherokee Electric Cooperative 
Overall score: 27/122

Clarke-Washington EMC
Overall score: 13/122

Coosa Valley Electric Cooperative
Overall score: 42/122

Covington Electric Cooperative has recently began development on a community solar garden (the first Alabama co-op to do so). This development is a direct result of their efforts towards democratic governance. Additionally, CEC is the only Alabama REC that allows members to vote early, by mail, in-person, and online. CEC has demonstrated a commitment to gender equality through bylaw amendments relating to pronouns. CEC is one of only three Alabama RECs to offer regular loan-based on-bill financing program.
Overall score: 59/122

Covington Electric Cooperative serves as a spectacular example of intentionally promoting member-owner engagement. Not only are they the only Alabama co-op to allow voting by all four means possible (in-person, early voting, by mail, and online), their move to allow online and mail-in voting resulted in their largest voter turnout ever.

Cullman Electric Cooperative is one of the clear winners when it comes to promoting electric vehicles. At their 2020 virtual annual meeting they held an EV information session and demonstration of the the EV and charger owned by the co-op. CEC provides information on their website regarding upcoming board meetings, as well as meeting minutes, and instructions on how members can propose bylaw amendments. However, members can only attend or speak at board meetings with prior approval.
Overall score: 55/122

Dixie Electric Cooperative offers heat-pump rebates and an off-bill financing program, and allows their members to vote both in-person and by mail.
Overall score: 37/122

Franklin Electric Cooperative
Overall score: 36/122

Joe Wheeler EMC
Overall score: 50/122

Marshall-Dekalb Electric Cooperative displayed troubling financial discrepancies between their public tax documents, resulting in inability to properly score them on compensation questions.
Overall score: 15/122

North Alabama Electric Cooperative
Overall score: 38/122

Pea River Electric Cooperative is one of only three Alabama RECs to offer regular loan-based on-bill financing program and water-heater rebates.
Overall score: 19/122

Pioneer Electric Cooperative held virtual meetings during COVID to ensure accessibility.
Overall score: 45/122

Sand Mountain Electric Cooperative
Overall score: 30/122

South Alabama Electric Cooperative (SAEC) displayed troubling financial discrepancies on their public tax documents, resulting in inability to properly score them on compensation questions. SAEC is one of only three Alabama RECs to offer regular loan-based on-bill financing program.
Overall score: 19/122

Southern Pine Electric Cooperative has a Member Task Force composed of 48 couples, 12 from each of the co-op’s four service areas. Task Force membership rotates annually giving members a chance to not only learn how their co-op works, and the needs it serves, but give feedback and serve in an advisory capacity.
Overall score: 26/122

Tallapoosa River Electric Cooperative
Overall score: 21/122

Tombigbee Electric Cooperative
Overall score: 46/122

Wiregrass Electric Cooperative (WEC) offers loan programs to provide seed money to generate economic development. WEC is one of only two co-ops that has the right for members to attend board meetings (and to do so without prior written approval) written into the bylaws. WEC further shows a dedication to transparency by providing an extensive FAQ on their website. WEC has demonstrated a commitment to gender equality through bylaw amendments relating to pronouns.
Overall score: 59/122

Wiregrass Electric Cooperative serves as a positive example of what transparency and accessibility should look like. They welcome members to attend meetings, and clearly inform members of upcoming elections and proposed bylaw amendments.

Some low scores may be due to lack of information. These RECs refused or failed to respond to requests for information: Arab Electric Cooperative, Baldwin EMC, Black Warrior EMC, Central Alabama Electric Cooperative. Clarke-Washington EMC, Pea River Electric Cooperative, Sand Mountain Electric Cooperative, South Alabama Electric Cooperative, and Tallapoosa River Electric Cooperative. These RECs did provide some information requested but failed/refused to respond to other requests: Franklin Electric Cooperative, Joe Wheeler EMC, Marshall-Dekalb Electric Cooperative, and Southern Pine Electric Cooperative. Scores of zero were given when information was not available/provided to us. These failures to provide information likely resulted in lower scores than would have been earned had they provided accurate information.

VIEW THE FULL SCORECARD

There is room for improvement at all of the Alabama RECs, and we hope that this Scorecard serves to provide information to all about what improvements are possible and needed.

 

Have questions about the REC Scorecard? Drop them in the comments below.

RELEASE: Scorecard Shows Lack of Transparency, Poor Access to Energy Efficiency, Renewable Energy at Alabama’s Electric Cooperatives

Contact:
Daniel Tait, Energy Alabama, (256) 812-1431, dtait@alcse.org
Kyle CriderAlabama Interfaith Power & Light, (2053065811, kyle@thepeoplesjusticecouncil.org

Fewer than half of Alabama’s electric cooperatives allow their member-owners to attend board meetings, half do not make their governing documents available online, and none offer community solar programs, according to a new report released today by Energy Alabama and Alabama Interfaith Power & Light. The report evaluated the performance of Alabama’s electric co-ops on a number of issues, from governance and finances to the programs they make available to their members.

The groups examined Alabama’s 22 electric co-ops and ranked them on best practices determined by advocacy groups and member-owners. Of a total of 120 points, no co-op scored higher than 59. >>See the online scorecard here.

“Electric cooperatives are supposed to be based on the involvement and authority of its member-owners,” said Daniel Tait, Energy Alabama’s Chief Operating Officer. “But this scorecard shows that most electric cooperatives in the state are failing to live up to their principles.”

“By practice and by law, co-ops are supposed to operate by the principles of democracy. It’s shocking that any of these electric co-ops would attempt to keep their member-owners from attending a board meeting. Electric cooperatives are largely exempt from state oversight and it has real world consequences,” said Kyle Crider, Alabama Interfaith Power & Light’s Program and Policy Director.

The scorecard found that all of Alabama’s co-ops have a monthly fixed charge of more than $15, significantly higher than recommended fixed charges determined by utility ratemaking experts like the Regulatory Assistance Project. High fixed fees present a particularly steep financial challenge for lower-income members, especially those currently struggling during the COVID-economic crisis, and for those pursuing energy efficiency and renewable energy options.

“Community solar and on-bill energy efficiency financing programs can lower members’ electricity bills while promoting local economic development and reducing fossil fuel emissions. Alabama co-ops are neglecting opportunities to promote cleaner, healthier communities,” said Ruby Krasnow, researcher with Energy Alabama and the author of the report.

“Alabama’s electric cooperatives were created decades ago to provide electricity and opportunity to Alabamians who were largely ignored by the investor-owned utility companies of the time,” said Tait. “Rural America needs cooperatives to deliver again, not shirk their responsibilities. Broadband, clean energy, bill savings, rural investment. All are possible with proactive cooperatives.”

The groups acknowledged that more than half of the cooperatives scored are developing or partnering with local companies to bring broadband to their communities, but noted that the co-ops could be doing more to improve quality of life for their member-owners through energy efficiency programs, community solar and by lowering the fixed charges on monthly electric bills.

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About Alabama Interfaith Power & Light
The mission of Alabama Interfaith Power & Light (ALIPL) is to be faithful stewards of Creation by responding to climate change through the promotion of environmental justice, energy conservation, energy efficiency, and renewable energy from a faith perspective. ALIPL is a program of The People’s Justice Council and sponsors such campaigns as the Interfaith Statement on Energy & Equity and Weatherizing Every Residence in the South East (WERiSE).

About Energy Alabama
Energy Alabama is a membership-based non-profit organization accelerating Alabama’s transition to sustainable energy. We accomplish our mission by educating at all levels, informing smart energy policy, building the next generation workforce, and providing technical assistance to deploy more sustainable energy. We believe in sustainable energy for all. Learn more at energyalabama.org