Home Energy and Environment Do Electric Co-ops Speak For Their Members? Not Us.

Do Electric Co-ops Speak For Their Members? Not Us.


by Mike Murphy of Culpeper County and Kathy Freise of Caroline County, member-owners of Rappahannock Electric Cooperative; they also work on the Repower REC campaign to reform their cooperative. Cross posted from Virginia Mercury, where it was originally published.

In March, Virginia’s electric cooperatives quietly signed a letter to Virginia Gov. Ralph Northam and members of the General Assembly asking them to delay the implementation of several new laws. The letter bore the letterhead of a group calling itself the “Coalition for a Strong Virginia Economy,” and the signers included a number of trade associations.

Among many other signatories was the Thomas Jefferson Institute for Public Policy. It receives Koch-network funding and has, according to the Center for Media and Democracy, promoted climate-science denial.

What laws did the electric co-ops ask the governor to delay? A series of measures that one would expect a group linked to the Koch network to oppose, including the Virginia Clean Economy Act (designed to reduce carbon pollution) as well as laws

  • raising the minimum wage,
  • removing minimum-wage exemptions for domestic (household) workers,
  • providing funding for flood preparedness,
  • allowing local governments to engage in collective bargaining, and
  • giving local governments greater authority over tax rates on meals, lodging, and cigarettes.

There are two issues here. One is whether the positions the co-ops took actually represent the interests of their member-owners. (Electric co-ops are owned by their customers, who are called member-owners.) The second issue is whether the co-ops’ member-owners agree with the positions taken in their name — or even know about them.

We disagree with the merits of the positions Virginia’s 14 customer-owned electric co-ops are promoting to state government officials. Electric co-ops ought not to be seeking to delay reducing climate-altering carbon emissions when climate change greatly threatens their rural member-owners.

We also question the wisdom of Virginia’s electric co-ops taking any position at all on such things as pay for domestic workers and taxes on hotel stays and cigarettes. And we further dispute the positions the co-ops took. No doubt every Virginia electric co-op has a good number of domestic workers among its member-owners. We don’t think customer-owned utilities should devote member-owners’ money working to ensure these hard-working people’s pay stays at rock-bottom levels.

According to the latest available IRS filings, Rappahannock Electric Co-op CEO Kent Farmer made over $1.3 million in 2018, while Old Dominion Electric Co-op’s then-CEO Jack Reasor made $971,859 in 2017. If they employ domestic workers at their homes they could afford to pay them a little more.

But we’ll save those discussions for another day. What we want to point out here is something Northam and many Virginia legislators likely don’t know but should. Virginia electric co-ops lobby government officials for these and other positions without informing the co-ops’ member-owners that they are doing so. Electric co-ops purport to speak for their rural member-owners, but in truth, they don’t. That’s both because co-ops don’t tell their member-owners what lobbying positions the co-ops are taking, and also because some co-ops engage in undemocratic practices to exclude their member-owners’ concerns. If member-owners don’t know what their co-ops are doing, and can’t vote in fair board elections, then the co-ops can’t honestly claim to speak for those member-owners.

We’ve looked at the Virginia electric co-ops’ magazine, websites, Facebook pages and Twitter accounts. These are the vehicles electric co-ops use to communicate with their member-owners. The co-ops’ magazine, Cooperative Living, is the largest-circulation publication in Virginia, reaching more than 510,000 rural Virginians. If electric co-ops wanted it to, Cooperative Living could keep Virginia co-op member-owners well-informed about the issues facing rural Virginians, and what electric cooperatives are doing and how much they’re spending in their lobbying efforts.

Yet our review found no indication whatsoever that Virginia’s customer-owned utilities are informing their member-owners of the co-ops’ lobbying efforts with our governor and legislators on the issues raised in the co-ops’ recent letter. This, despite the fact, that all cooperatives are supposed to abide by the seven cooperative principles, dating back to the early 19th century days of the cooperative movement. One of those seven principles is “education,” which includes keeping co-op members informed about pertinent issues involving their cooperative.

Unfortunately, it is not uncommon for businesses to be secretive about their lobbying, and to use shadowy front groups to do their dirty work. But most businesses aren’t customer-owned.  Electric cooperatives are, and they’re supposed to be (and they claim to be) different. They even brag about their supposed “cooperative difference,” because (they say) they’re “dedicated to serving their members and communities with integrity, accountability, innovation, and commitment to community ….”  Sadly, that’s not happening in Virginia when co-ops fail to keep their member-owners informed of the lobbying positions the co-ops take.

What is needed to get Virginia’s electric cooperatives to live up to their high-minded but unfulfilled principles is legislation requiring full transparency about the co-ops’ activities. Electric co-ops should be required to disclose their lobbying positions and expenses to their member-owners. Co-op member-owners should be able to observe their co-ops’ board meetings.

Only one Virginia co-op (Powell Valley) allows that today. Co-op board elections should be democratic, with direct elections that allow voting member-owners, rather than incumbent board members, to control election outcomes. For example, Rappahannock Electric Cooperative resists efforts to ensure transparency and fair board elections. With true democratic control, full transparency, and fair board elections Virginia electric co-ops might someday be able to accurately claim to speak for their member-owners.

But until that happens, until Virginia’s electric co-ops live up to cooperative principles, Governor Northam and Virginia legislators should know that when co-ops purport to speak on behalf of rural Virginians, the co-ops cannot be fully trusted.


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