Energy co-ops in US move to renewables

The sector is still reliant on fossil fuels but as the price of wind and solar drop, change is coming

US electric co-ops have been moving towards renewable energy as growing alarm over climate change shifts public opinion and the cost of clean energy falls.

The official line of NRECA, the apex body for the sector, is to support existing coal plants for their lifespan.

Its stated policy on climate change reads: “Co-ops continue to diversify their electric generation portfolio through increased use of natural gas and renewable energy. This helps lower emissions, including carbon dioxide.

“However, coal-fired generation remains significant for co-ops, and NRECA opposes policies that would prematurely force the closure of these plants, which provide affordable energy for rural families. We support the Trump administration’s efforts to replace the Clean Power Plan with the more workable Affordable Clean Energy rule.”

But individual co-ops are making the switch. Last month, five electric co-ops in Texas agreed to buy 7mW of solar generation from a Canadian renewable energy developer, enough to power about 1,400 homes through a hot summer day.

In Georgia, Walton Electric Membership Corporation and Coastal Electric Cooperative have created community-owned solar plants, as do  Roanoke Electric Cooperative in North Carolina and the Florida Keys Electric Cooperative.

Some co-ops are even buying their way out of contracts with coal generators so they can go green.

In Colorado, electric co-op member Joe Smyth runs a website tracking the progress of electric co-ops on managing the clean energy transition. He writes: “Because electric cooperatives are non-profits owned by their members, they can navigate this energy transition in ways that empower their members, without worrying about investor profits.

“At the same time, many electric co-operatives face unique challenges in moving from coal to clean energy.”

He says three electric co-ops in Colorado have now set clean energy goals, reflecting a growing recognition of the declining prices for renewable energy and increased public support for wind and solar.

In February, Grand Valley Power announced “one of the most aggressive environmental targets of any electric co-operative in the nation – to deliver a 60% clean energy mix to its 18,000 consumers by 2030”.

“As a locally owned co-operative, we have always been good stewards of our environment,” said chief executive Tom Walch. “With cost-effective advances in clean renewable energy technology, we’ll be able to meet this 60% target by 2030 while maintaining rate stability and our excellent reliability standards.”

Meanwhile, in Virginia, lawmakers are working with representatives of utilities, the renewable energy sector and environmental interests on a bill to change the rules around metering, which would give member-consumers increased access to renewables, and allowing electric co-ops to better recover and allocate their costs.

And Renewable Energy World website highlights recent progress by co-ops in Iowa and New Mexico, who have overcome some of the barriers standing between them and a clean energy switch.

The 20,000 member Kit Carson Electric Co-op in New Mexico was stymied its existing contract with energy supplier Tri-State, which only allowed the co-op to generate 5% of its electricity. The co-op paid a fee to get out of the contract and now hopes to  to fill 100% of its daytime electricity demand with solar by 2022.

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Farmers Electric Cooperative, which serves 600 members in Kalona, Iowa, has the highest proportion of solar per customer of any US utility – split between members’s own solar installations, its community solar project, and solar is owned by the co-op itself.

But it is still stuck in a contract which sees it buy half its electricity from a coal plant in Illinois. Other co-ops in the upper Midwest have contracts that extend for decades, says Renewable Energy world, which says improved governance and engagement are needed in the sector to drive change which brings cost benefits for members as well as environmental ones.

The change comes as industry experts predict a decline in the market for fossil fuels as renewables become cheaper and price them out. In his report 2020 Vision: why you should see the fossil fuel peak coming, Kingsmill Bond of Carbon Tracker writes: “Three major technologies of solar PV, wind and Lithium-ion (li-ion) batteries enjoy both rapid growth and technology-driven learning curves.

“For each doubling in capacity their costs have been falling at around 20%, a phenomenon that we expect to continue. In addition to this, digitisation has become a key enabler of the energy transition.”

He adds: “The motor of change now lies in the emerging markets, which is where all the growth in energy demand lies. Emerging markets have higher population density, more pollution, and rising energy demand.

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“They have less fossil fuel legacy infrastructure, rising energy dependency, and are anxious to seize the opportunities of the renewables age. We believe it highly likely therefore that emerging markets will increasingly source their energy demand growth from renewable sources not from fossil fuels.”

This brings economic opportunities: in the US, the number of clean energy jobs grew by 3.6%  in 2018, to about 3.3 million – with growth in every state.

On the flip side, observers have already pointed to the decline of fossil-reliant companies like General Electric, which was dropped from the Dow Industrial Average last June after more than a century.

This market change could help usher in a less centralised, more democratic energy system and reduce the dependence on imported fuel. A report by the International Renewable Energy Agency says: “Most countries will be able to achieve energy independence: they will have greater energy security and more freedom to take the energy decisions that suit them.

“Since some form of economically viable renewable energy potential is available in most places, countries that currently depend heavily on fossil fuel imports will be able to use renewables to reap strategic and economic benefits.”

This, it adds, will mean putting more control over energy into the hands of cities, communities and individual consumers – which would be good news for co-ops.