| Big Rivers Electric Corporation: Joining Forces |
| Energy Executive Spotlight | |
| Written by Eric Slack | |
| Monday, 31 December 2007 | |
 This energy cooperative has proven that working together has its benefits.  Mike Core, CEO Together, Kenergy, Meade County, and Jackson Purchase make up the membership group that owns Big Rivers, each with two seats on the board of directors. Big Rivers owns the transmission system and uses it to deliver bulk power to its member systems for retail distribution. According to Mike Core, Big Rivers’ CEO for the past 11 years, the company exists solely to serve its three members, so they in turn can service their 110,000 customer-members. “Our mission is to provide our member systems with reliable, cost effective wholesale power for resale to their customer-members,” said Core. “A cooperative is not formed to give a return on investment. Our structure was designed to allow us to focus on service for the end consumer.” According to Core, Big Rivers essentially operates as a nonprofit. Although the company strives to maintain a strong balance sheet, any money made is allocated back to the three member systems, and the board of directors decides when to retire those capital credits. In the meantime, Big Rivers uses those funds as capital to upgrade its system. Recently, it upgraded its microwave communication system from analog to digital. The company installed new energy management systems for its transmission system. It also installed laptop computers in its line trucks with system maps tied to GPS, saving time and reducing paper work. Big Rivers also handles all software, equipment, maintenance, IT, and marketing needs for its three member systems. The relationship allows Big Rivers to focus on generating power while the three member systems concentrate on the customer. “Our member systems know their territories better than we do, so we work closely with them however they need us,” Core said, noting the companies work together to provide safety training for utility workers, one of the most dangerous jobs in the world. “Primarily, each has its own individual staff because each has an individual customer base, but we find synergies and economies when we can.” Changing the status quo Energy efficiency is one area Big Rivers is focusing on. Big Rivers has no plans to build additional generation capacity, so meeting growing energy demands will be difficult. Core believes all utilities will face challenges building new coal-fired plants because of concerns about climate change. Enter the Touchstone Energy Cooperative, a nationwide group-branding program for independent companies, somewhat similar to the Ace Hardware brand. Through this initiative, Big Rivers is working with its members to educate the end consumer about efficient usage of electricity from the generation and lines already in place. Big Rivers’ members serve an area with property available for economic development, including river frontage along the Ohio River. With so much room for regional growth comes an even greater need for power, as well as efficient use of that power. In response, Big Rivers works with its member systems to help businesses, homes, and schools increase their energy efficiency by installing modern equipment in new or remodeled buildings. It also is engaged in a far-reaching program to distribute free compact fluorescent lights (CFLs) to its members at their annual meetings. The company hopes to give away several hundred thousand CFLs during the next few years. “You are replacing a 100-watt bulb with a 24-watt bulb, producing approximately the same amount of lumens of light. It reduces a revenue stream, but over time. And you are getting more efficient use out of your assets,” Core said. “The key is that you aren’t adding coal-fired generation. Instead, you are using what is already there more efficiently.” It hasn’t always been easy for Big Rivers to focus on efficiency. In the late 1970s, Big Rivers built the Wilson Plant, a 420-megawatt coal-fired production plant based on calculations the government and its customers were going to need additional capacity. Due to the interest rates on the capital costs going into the power plant, Big Rivers found itself struggling with debt service through the 1980s and 1990s, and in late 1996, it filed for bankruptcy. It restructured its debt and leased the operations of its plants to E.ON U.S. Things have changed so much that the two companies are now in the process of seeking an end to a lease originally set to run through 2023. “The arrangement worked well and allowed us to get our feet under us,” Core said. “About four years ago, they asked us to entertain ending the lease. It is not done yet, and we continue to work on it.” Together with the hundreds of electric cooperatives and associations like the National Rural Electric Cooperative Association, Big Rivers and its three member systems are doing their part to provide clean power at a good price. But continuing to do so isn’t going to get easier. The political discussion over climate change and emission controls continues, but perhaps the cooperation that Big Rivers embodies can lead to solutions. “The network of cooperatives in this country maintains more lines than any investor-owned utility. Together, we serve nearly 80% of the land mass, much of which is low density,” Core said. “The only way you can do that is by working together. That is where cooperatives have found success, and we believe working together is the key for our members.” |
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American Executive is a RedCoat Publishing publication.
American Executive is a RedCoat Publishing publication.
