In the past month, I was contacted by a local radio station and interviewed regarding the current rate issues surrounding the electric utility industry and what impact, if any, this had on SouthEastern Illinois Electric Cooperative and why.  In this article, I would like to share some of my thoughts with you about this question and re-emphasize the Cooperative Difference.

The rate issues surrounding the electric utility industry that you have been reading and hearing about do not have a direct impact on your Cooperative for a variety of reasons.  First of all, electric cooperatives are not-for-profit organizations that are member-owned and member-controlled.  This is the most profound and distinct difference between electric cooperatives and other utility business structures.  Your cooperative strives to provide the highest level of reliable, quality service at rates just high enough to cover the costs instead of striving to create profits for stockholders.  In addition, your cooperative is governed by a local group of elected officials that serve as the Cooperative's Board of Trustees.  You, as cooperative members, have the ability and responsibility to elect your Trustees at the annual meeting conducted every year.  Due to the fact that Cooperatives are not-for-profit entities owned and controlled by the consumers themselves, Cooperatives were treated differently than investor owned utilities under the 1997 deregulation law.  Your Cooperative Trustees made the conscious decision to not participate in the deregulation arena and as it turns out, your Cooperative definitely made the right decision.

Secondly, your cooperative along with five other electric cooperatives in Southern Illinois own Southern Illinois Power Cooperative (SIPC) located at the Lake Of Egypt just south of Marion, Illinois.  The electricity that you consume in your homes, farms and businesses is actually generated at this plant with the exception that some power is purchased on the open market during peak capacity times.  The fact that your Cooperative is part owner of its own generating plant is a strategic advantage and has saved Cooperative members a significant amount of money over the years.  Some of you may already realize this but approximately 72% of your Cooperative's total cost is spent on generating and transmitting your electricity over high-voltage transmission lines to your regions.  If your Cooperative did not own its share of SIPC, it would not have any input or control over the direction or price of these activities that comprise 72% of the total cost.  This means that your Cooperative would have to rely on other electric utilities to provide these services with no input or control over the direction or the price.  You can see why owning your own generation and transmission facilities are very important.

I would like to close by stating that all of us can be proud to be a part of the Electric Cooperative program.  The founders of the electric cooperative program developed a unique business structure that by its very nature, makes electric cooperatives very accountable to the members it serves.  This unique structure has contributed to the success of your cooperative over the years and remains unchanged even today, some 69 years later.  Your cooperative is governed by local people that live and work in your very own communities.  Your cooperative is operated by a group of local employees that also live and work in your very own communities.  Your cooperative's sole purpose is to provide you, as cooperative member-owners, with reliable and quality service at equitable rates.  Are we perfect, no we aren't, but I can tell you that we work very hard for you and will continue to be committed to you, as cooperative member-owners.

See you next month and as always, "We'll keep the lights on for you."