Thinking Big: From Broadband to Microgrids, Small Co-ops Find Innovative Ways to Make a Large Impact
Big electric cooperatives, with their heftier budgets and larger staffs, often get the recognition for leading on technological innovations and groundbreaking projects.
But some smaller co-ops have refused to let size stand in the way of their commitments to big-time service.
“The pace of change and innovation may be different around the country, but the size of the cooperative is not an impediment to taking on challenges and meeting consumer-members’ needs,” says Jim Spiers, NRECA vice president for Business and Technology Strategies. “I think the co-op commitment to local and democratic control is what sets us apart. It means the cooperative is always in the best position to respond to member concerns.”
Spiers adds that smaller co-ops have a way of getting the most out of their staffs by tapping into their skills, their personalities, and their community ties. When a problem or need gets noticed, conversations begun on a pickup truck tailgate or at a roadside diner can lead to good ideas and thoughtful solutions with a co-op connection. When those ideas leap from napkin or paper sack drawings to business plans and blueprints, the people at small co-ops roll up their sleeves and get to work.
Of the 843 NRECA members that are distribution cooperatives and member-owned public power districts, 125 systems have more than 40,000 meters, 168 are between 20,000 and 40,000, and 550 serve 20,000 meters or fewer.
For the purpose of this article, we’ll look only at co-ops in the last group.
Southeast Colorado Power Association: Totally Wired
Back in the days when the internet primarily meant dial-up service accessed through third-party service providers, leaders of Southeast Colorado Power Association (SECPA) were already carving a path toward the winning side of the digital divide. The result is high-speed service in rural communities as good as or better than what’s available in many metropolitan areas.
The La Junta, Colo.-based distribution co-op began planning installation of telecommunication components across its system in the late 1990s. As discussions moved into fiber optics, managers and directors considered options that would make a new fiber network a community resource.
“Discussions began with community institutions that were already looking for reliable and affordable options to access information and data with high-quality consistency,” says Jack Johnston, CEO of SECPA.
That was in 1998, and talks led to 22 schools, eight libraries, six agriculture extension service offices, four hospitals, and two community colleges committing to the project. The following year, a 600-mile fiber-optic backbone was built to serve those institutions, plus the co-op’s offices and many substations.
“The locations of those facilities gave us an immediate market to nearby businesses looking for alternatives to the T-1 or dial-up services available at the time,” Johnston says. It also offered the possibility of building a network reaching beyond the 10,000 members across its service territory.
“Because some of the institutions and surrounding businesses were outside areas served by SECPA, we created SECOM, or Southeast Communications, as a division,” Johnston says. “We also began offering broadband internet service directly to potential customers.”
Before sales started, Jon Saunders, chief operating officer for SECOM, joined the company as a network engineer. Since then, he has overseen the network’s expansion and technology upgrades.
“We’ve been able to serve many of our rural areas by building out a wireless distribution network supported by our fiber-optic system,” Saunders says. “We’re now upgrading those sites to the fifth generation of wireless equipment.”
Wireless access points across the system are installed atop tall buildings, on grain elevators, and on water tanks, as well as on conventional communications towers. In some rural locations, co-op poles have been built on hilltops solely to expand the network.
“We use 30-foot poles, and the only power going to the pole is a secondary line carrying 240 volts to serve the equipment,” Saunders says.
Since the first customers signed up in late 1999, SECOM has continued to grow. The company now has more than 6,000 customers and service is available in neighboring Pueblo and parts of Colorado Springs. With a USDA Community Connect Grant, it has added communities like Aguilar.
Quality internet and direct peering connections mean no buffering when streaming movies or music, and gamers enjoy fast connections. Cottage industries have sprung up, and customers have reliable connections for telecommuting.
“When we promise speeds, 200 megabits per second, for example, that’s not just a goal,” Saunders says. “It’s a commitment to that customer.”
South Louisiana Electric Cooperative Association: Power and Water
After heavy rains, it would just bubble to the surface— raw sewage rendering the yards of customers unusable and posing health and environmental hazards for entire neighborhoods.
The outdated, poorly maintained sewage system serving communities in southeastern Louisiana faced numerous state and federal violations. The small, privately owned system was one of several in the region that had fallen into disrepair.
“Our assistant general manager was having a lot of problems with sewage backups in his yard,” says Joe Ticheli, general manager of South Louisiana Electric Cooperative Association (SLECA) in Houma. “He was having both wastewater issues and water quality issues, and many of our members were too.”
The owner-operator faced criminal charges, and when systems under his control fell into bankruptcy, state and federal regulators saw the electric cooperative as a potential solution.
“We actually were not the lowest bidder when the projects went up for sale, but regulatory agencies knew the co-op had a good reputation and supported our bid,” says Ticheli, who has been with SLECA for 17 years and has been general manager since 2011. “We felt that by buying these systems and bringing them up to standard, we’d improve the lives of SLECA members. Operated correctly, we felt it could also help keep electric rates down for our nearly 17,000 SLECA members by providing revenue to help offset our power costs.”
The co-op made the acquisition and established Total Environmental Solutions Inc. (TESI) as a for-profit subsidiary in 2000. It initially included water and sewer systems in six states, but it has since been trimmed back through sales to operations in Louisiana and the Carolinas.
“We have a large offshore oil and gas industry based in Houma, and many of our SLECA members are shrimpers,” Ticheli says. “That means investments we make in our water and sewer systems help protect their livelihoods.”
TESI is run independently with its own senior management and board of directors, but many of its business and safety practices mirror cooperative business model principles followed by SLECA.
“We’ve got about 17,400 customers in south Louisiana, where we operate 200 wastewater systems and 26 water systems,” says Bill Schoening, TESI’s CEO, adding that TESI’s physical assets in the state are valued at $6.8 million, and net revenues total $5.6 million annually.
The company continues to improve its properties with a goal of meeting operating standards required under the Clean Water Act. Most facilities are meeting compliance schedules outlined in a 2000 consent decree, according to officials at the Environmental Protection Agency. An application to replace the consent decree with a long-term compliance plan is under review.
TESI facilities are compliant with Louisiana Department of Environmental Quality standards, says Greg Langley, the state agency’s press secretary, adding that organic nutrients flowing into the Gulf of Mexico do not primarily originate in Louisiana.
“We’re always monitoring efforts that help to keep our waters clean, so we have a strong interest in how sewage facilities operate,” he says.
Bayfield Electric: Member-Driven Solar
Conversations about community solar are pretty common for electric cooperatives these days, but at Wisconsin’s Bayfield Electric Cooperative, one well-informed member has a lot of people listening.
“We’ve been able to generate an awful lot of interest in community solar in a relatively low-income area,” says Bill Bailey, founder of Chequamegon Bay Renewables, a non-profit foundation promoting renewable energy and sustainable agriculture. “The key was just talking to people about the potential of controlling their costs and getting them to think in terms of annual savings.”
Bailey formerly operated a commercial greenhouse in Bayfield Electric’s service territory. When he decided to add a number of efficiency and renewable energy features to his business in 2011, he approached the Iron River-based co-op about interconnecting his new solar arrays to its system.
“We’re a small co-op with less than 8,900 members, so everybody does a lot of different jobs,” says Larry Roecker, the co-op’s master electrician who is also the co-op’s director of member services and informational services. So after Bailey pitched to the directors and managers the idea of a community solar project for the co-op in September 2014, the board asked Roecker to look into it.
“I asked Bill to help me put together a survey, and within weeks, it was approved by the board,” Roecker recalls. The survey was distributed to all Bayfield Electric members in the local pages of the statewide consumer magazine, Wisconsin Energy Cooperative News, in the February 2015 issue.
Although Wisconsin weather might make solar a hard sell, the co-op has stressed net metering and the savings solar might provide during summer months corresponding to peak demand periods.
“Along Lake Superior, the worst months for solar production are November and December, due to overcast conditions and reduced daylight hours,” Bailey says. Once ice forms on the lake and temperatures drop in the winter, though, solar production increases because there is less daytime cloud cover.
Over the following year, survey results were tabulated and discussions about potential projects were included in membership meetings and other community events. Directors also began considering the size of a community solar project, agreeing in March 2016 to at least a 150-kilowatt array priced at $499,000, to be fully funded by June 1.
“We had two months to collect a half-million dollars,” Bailey says. “We pitched the project at community meetings, to civic and business groups, and kept promoting share purchases in Wisconsin Energy Cooperative News.”
Members were allowed to subscribe to the equivalent of 90 percent of their annual power use, based on a three-year average. The price of each available 205-watt unit was set at $500.
When collected funds topped $380,000, or 76 percent of what was needed for the small project in May, plans to build got underway. But in June, money kept coming in, reaching $785,000, and the project was expanded to 250 kW.
“When we held our annual meeting in June, members asked us to expand the project to 300 kW so more members could participate,” recalls Bayfield CEO Diane Berweger. “We started construction late summer of 2016.”
The project has been on-line since October 2016. “Of 2,016 available shares, less than 100 have not been sold, and we built the largest array we could handle at our headquarters,” Berweger says.
Gallery | Small Co-op, Big Solar
Cordova Electric Cooperative: Small Town, Big Thinking
When the people of Cordova, Alaska, plan for a sustainable future, the motivations to find local solutions come right out of local geography and history. The community of 2,200 is reachable only by boat or aircraft, and a string of disasters over the past 60 years has fueled a passion for homegrown self-reliance.
“We always have to be ready for uncertainty, whether it’s caused by weather, geology, or anything else,” says Clay Koplin, CEO of Cordova Electric Cooperative.
In 1964, the Great Alaska Earthquake raised the town’s elevation by 6 feet, dramatically increasing its footprint. The Exxon Valdez oil spill turned the waters surrounding Cordova into an environmental “dead zone” in 1989. Flooding following heavy rains in 2006 washed away components of the co-op’s 1.25-MW Humpback Creek hydroelectric facility as it was undergoing major renovations following a fire. A 5-ton transformer wound up downstream, and a 500-lb. transformer washed out to sea was found during low tide more than a mile offshore.
“We can never say, ‘We will meet this construction timeline at this exact cost,’ because it never happens that way,” Koplin says.
In 2015, Koplin, an engineer by training, completed two years of fulltime distance learning at Indiana University’s Kelley School of Business to earn his MBA. He’s used the experience to factor agility into the co-op’s organizational chart, and he approaches major projects in ways designed to use the talents of his staff, now mostly from the millennial generation.
“It allows us to react to external developments while maintaining our connections to the co-op’s core values and established operating practices,” he says.
Results have included burying the entire 78-mile distribution system to all but end weather-related outages, and all street lights in Cordova were converted to energy-saving LEDs. Cordova Electric’s system is highly automated, with operating data collected and stored for maintenance and performance analysis.
Serving 1,566 members, Cordova Electric has operated for years as a microgrid. Its 18 MW of generation also include nearly 11 MW of diesel generation at the co-op’s Orca Power Plant and 6 MW from its Power Creek Hydroelectric facility.
“We have all of this rich data from every operating parameter we’ve been collecting, and that’s caught the attention of both state and federal analysts,” says Craig Kuntz, the co-op’s project technology coordinator. Kuntz has been involved in several projects where controlling costs and reducing delays have been critical.
Sandia National Laboratory, in Albuquerque, N.M., is mining 15 years of Cordova Electric’s smart grid data. It’s being used to perform dynamic modeling of the Alaska Center for Energy and Power’s recently completed static power flow and generation mix modeling for a proposed battery storage project.
A joint municipal water and co-op power project at Crater Lake, about three miles northeast of the city, could boost Cordova Electric’s renewables capacity to 90 percent or more while meeting the increased demand for city water during seafood-processing season.
“If a 1.5-MW battery bank in a container can store 4 to 6 MWh of energy, Crater Lake could store 500 times that amount,” Koplin says. “At that point, adding solar or wind to our grid gives us ample stored hydropower when these sources are not available.”
Hancock-Wood Electric Cooperative: Island Service
Hard, wet work and lots of planning have to occur before tons of cable can be laid to keep electricity flowing to Kelleys Island, Ohio. Hancock-Wood Electric Cooperative has spent nearly five years getting ready for a $5 million cable replacement project designed to serve the 10 percent of its members who live there.
“We looked at all available options for replacing the 1970 east cable to ensure service reliability, and a new underwater cable made the most sense,” says Bill Barnhart, the North Baltimore, Ohio-based co-op’s vice president of engineering and operations.
This is the co-op’s fourth such underwater cable project since it took over service operations for the island after merging with the tiny Lake Erie Electric Cooperative (LEEC) in 1967. The first Hancock-Wood Electric cable was laid from Marblehead Peninsula in 1970, and a second replaced the failed LEEC west cable in 1970. The third replacement cable was installed to replace a damaged one after it was caught by a Canadian tugboat anchor in 2003.
“The cable weighed 6.5 pounds per foot and was dragged about one mile out of position,” recalls John Cheney, former general manager. It was torn from its position on the island, snapped in the middle, and broken on the mainland.
Cheney, now 85, engineered the installation of Hancock-Wood Electric’s original island cables and oversaw their rehabilitation as a contractor in the late 1990s. In 1998, Cheney also was project manager for a $600,000 silicone-injection process that extended the life of the cable, delaying costly replacement for 18 years. Hancock-Wood Electric was the first company to use this process for an underwater application, according to contractors.
While Lake Erie’s average depth is 62 feet, the sloped channel between Marblehead and Kelleys Island is less than half that. In the shallowest areas, the cable will be buried 3 feet down in silt atop the solid limestone lakebed.
The new power line upgrades capacity from a 15-kilovolt line to a 34-kilovolt line and includes fiber-optic cable for broadband services. The offshore work must be completed before winter ice floes clog the channel.
“We anchor the terminal ends to bedrock and install cast-iron submarine protectors on both ends of the cable to prevent damage from boats, ships, or submerged ice,” Barnhart says.
More than 925 of Hancock-Wood Electric’s nearly 11,000 members reside on the island, but fewer than 400 live there year-round. The island is a popular tourist destination for North Coast families between Cleveland and Detroit, so no work will be done during the busy summer months.
“We’ll spend this year and early 2018 on permit requirements, environmental and logistics issues and begin offshore work after Labor Day,” Barnhart says. “Then we’ve got a narrow window to get the cable placed before winter.”
Co-op members on the island will pay a $10 monthly charge over 20 years to cover part of the project’s costs. Directors compared analyses of capital projects across the co-op’s system to determine what they believe is a fair contribution to ensure reliable service on the island for decades to come.
“The directors approved this nominal assessment for islanders benefitting from this service so it would not adversely affect them,” says George B. Walton, Hancock-Wood Electric’s president and CEO. “As a members-first cooperative utility, we are committed to providing safe, affordable, and reliable electric service to all our member-owners—including those who are literally at the end of the line.”
Original Article: http://remagazine.coop/innovation-ideas-small-co-ops/
Written by: Derrill Holly