The $5 Million Reason Advocating for Electric Co-Ops is so Important
When the Green Bay Packers took the field for Jordan Love’s very first home game as the team’s starting quarterback at Lambeau Field on Sunday, September 24, they were solid underdogs. Plagued by injuries and inexperience, the team was down 17 to 0 heading into the 4th quarter. No one thought they would win. But they did.
“I’ve never been a part of a win like this,” Packers coach Matt LaFleur said after the game. “The guys in the locker room, they believe. They believe in one another. And they continued to battle.”
The “never quit, keep fighting” fueled the team’s comeback with 18 unanswered points and a win. When you’re the underdogs, success is always a little sweeter.
It’s a position that electric cooperatives are very familiar with. Serving mostly rural areas, co-ops do more with less. Nationally, electric cooperatives serve an average of 5.7 consumers per mile of line for about $16,000 in annual revenue, compared to investor-owned utilities, which have, on average, 34 customers per mile of line and collect $75,500 in revenue. The job of restoring power following a winter storm in rural areas can be monumental.
“The more miles of line, the longer it can take to locate issues and return to service,” Wisconsin Electric Cooperative Association (WECA) Vice President of Operations Tim Clay explained in written comments to the Public Service Commission of Wisconsin (PSC) related to the implementation of a grant aimed at strengthening the grid to prevent widespread outages. “Powerlines in rural areas generally run long distances to provide electricity to sparsely populated areas that cover large geographical areas and are more susceptible to high winds, ice, and other severe weather events.”
The Grid Resilience program, funded by the Infrastructure, Jobs, and Reinvestment Act (IIJA), is one small piece of the Biden Administration’s Investing in America agenda, which includes more than $50 billion for climate resilience. Recognizing that transitioning from baseload energy, such as coal and natural gas, to more intermittent resources, including wind and solar, could upset the aging apple cart that is the electric grid, the Department of Energy has dedicated much of the money to clean energy innovations and upgrades, but often times electric co-ops seeking these funds find they are out of their league.
“For example, the DOE’s Preventing Outages and Enhancing the Resilience of the Electric Grid grant program limits the number of projects, which means the size of an average application would require about $100 million in capital investments,” Clay said. “It’s not an option for most electric co-ops.”
For that reason, Clay argued to the PSC that the funds from the $10.24 million Grid Resilience and Innovation Partnerships (GRIP) program should be designated to smaller utilities because “this state-administered program is the only realistic program these entities are able to apply for without extensive development and consulting costs associated with consortium-based proposals for other programs…”
In funding the program, the federal government requires Wisconsin to dedicate at least 24% of the funds to smaller utilities. However, along with WECA, Oakdale Electric Cooperative, Eau Claire Energy Cooperative, and Polk-Burnett Electric Cooperative argued it should be more.
Eau Claire Energy noted the co-op still currently has 379 miles of overhead lines with old copper conductors that were installed in the 1940s, 1950s, and 1960s that have deteriorated over time. Many of them are located within disadvantaged areas of the county, and with increased electrification and higher usage, the capacity creates a reliability concern.
“…the replacement of aging copper lines has been a priority within ECEC’s work plans for some time. However, limitations to both the funding and resources available to the cooperative only allow for the replacement of approximately 10 miles of line each year. With no additional assistance available, this replacement would take another nearly 40 years, and some of the line sections would be over 120 years old before they are replaced,” the written statement read.
“WECA believes electric cooperatives, municipal electric utilities, and small, privately owned utilities should be the sole focus of this program,” Clay wrote.
And the PSC listened.
During an open meeting on August 31, the three-member commission voted unanimously to award 75% of this program’s funds to smaller utilities, or $7.3 million, an increase of $5 million from the required 24%. (The total grant dollars that will be allocated is $9.73 million after PSC administrative costs).
“I took the comments from the Wisconsin Electric Cooperative Association and the other co-ops. I took those comments to heart,” said PSC Chair Rebecca Cameron Valcq, who proposed the 75% allocation. “When you look at the footprint of our small co-ops and the associated cost with trying to make their system more resilient, I think that they need more money. And this is our opportunity to provide that money now.”
Valcq added that smaller utilities may actually end up receiving 100% of the funds.
“It’s a rewarding feeling to know the commission gave consideration to our comments and delivered a favorable decision,” Clay said. “I applaud our co-ops who participated since their real-world stories about their experiences and challenges in providing reliable electricity with limited resources really made an impact here.”
Keith Dennis, president of the Beneficial Electrification League, says he shares Wisconsin’s success story with other states. “The grid resiliency grants are among the most relevant, practical grant opportunities for small, rural utilities. The set-aside and advantageous cost match for small utilities make dedicating as much of the funds to electric cooperatives an easy decision for states. Our hope is that many states see this grant, even though relatively small, as an opportunity to engage rural utilities with state funding.”
“These decisions made by the Commission will make a real difference to the communities and members we serve, and we were incredibly proud that the Commission specifically mentioned that the efforts and comments submitted by WECA and our fellow cooperatives factored into their decision-making process,” added Ben Krambeer, Eau Claire Energy system engineer. “We are especially passionate about this opportunity because we feel that cooperatives are very well equipped to accomplish the objectives that were set by the Commission for this project.”
Like the Green Bay Packers, who spend less time celebrating and more time preparing for the next challenge, WECA is already working to cross the next hurdle by creating a resource guide to help the state’s electric co-ops successfully apply for the grant funds, which will prioritize projects that modernize and harden the grid to protect against extreme weather and natural disaster outages, with an emphasis on disadvantaged communities.
“It’s about identifying and presenting projects that are best suited to meet the objectives the PSC is looking for,” Clay said. “The great thing about the electric cooperative family is that we work with each other and not against each other. It’s that teamwork that helps us succeed.”
Especially when you’re the underdog.—Julie Lund