The Big Green Co-op

In a remarkably short time—18 months—some very forward thinking cooperative leaders have launched a new organization that will help bring more electricity from renewable resources into the nation’s grid of power transmission lines.

Electric cooperatives already have an established track record with renewable energy.

At the national level, when all kinds of electric utilities are grouped together (municipals, investor-owned companies, and cooperatives), about 3 percent of the power they add to the grid comes from renewable resources. But if you look just at cooperatives, more than 11 percent of their electricity is generated from renewable resources. That’s almost four times as much renewable energy in cooperatives compared to the overall national electric system.

It’s important to note that hydroelectric power, using the force of falling water at river dams, is counted separately from all other renewable resources. But that still leaves a big selection of other renewable, non-fossil fuel ways to generate electricity. Solar, wind, and biomass options are all available and in use today throughout America.

But these renewable choices are not equally practical in every state.

Ron Harper, CEO at Basin Electric Power Cooperative headquartered in Bismarck, North Dakota, says, “We have tremendous wind resources here in the Dakotas, but we don’t have the solar options that Arizona has. Kentucky doesn’t necessarily have either of those opportunities, yet biomass is an example of a renewable energy resource that can and does work there.”

The idea for a renewables co-op first appeared during an April 2007 meeting of several generation and transmission managers from cooperatives around the United States. Harper says, “We decided that if we joined together we could take advantage of our differences. We asked ourselves how we could work better together to develop renewable resources that make sense.”

Between April 2007 and March 2008, they began developing the National Renewables Cooperative Organization (NRCO). They created a business plan, drafted a set of bylaws, held the first board of directors meeting, and announced the new organization. In its first 18 months, NRCO has already attracted more than 20 electric co-ops as members.

Sharing power and ideas
NRCO will serve as both a clearinghouse and matchmaking service. Its experts will evaluate renewable energy proposals to see how well they meet standards such as emissions limits and engineering practices. Members will then have the option to participate in the project. NRCO members might choose to become investors to help build the project, or sign up as customers who will buy electricity generated from the renewable resource.

In the short term, NRCO participants will most likely work together within local and regional geographic areas. Current rules about “green tags” that allow electric utilities to trade credits for renewable energy among themselves may provide opportunities to expand the number of co-ops that can participate.

In the long term, NRCO may also get involved in improving the nation’s transmission system so that getting power from more renewable generating plants into more sections of the grid can become a physical reality, too. In many parts of the United States, it’s still physically tough to get electricity from remote windy or sunny areas to more densely populated areas. The transmission lines either don’t exist, or they’re already being used so much there’s congestion, just like on a highway.

When NRCO invited generation and transmission cooperatives throughout the nation to join this innovative group, East Kentucky Power Cooperative was one of the first 10 co-ops to join. Headquartered in Winchester, East Kentucky supplies electricity to 16 distribution co-ops and serves electric consumers in 87 Kentucky counties. The other Kentucky member of NRCO is Henderson-based Big Rivers Electric co-op, which supplies electricity to three distribution co-ops in 22 counties.

During a typical year, East Kentucky buys about 235 megawatts of electricity from hydroelectric facilities operated by other providers. During the summer months, East Kentucky’s own fossil fuel power plants (mostly coal, with some natural gas) have the capacity to generate about 2,200 megawatts of electricity. During the winter months, East Kentucky has the capacity at those fossil fuel plants to generate about 2,500 megawatts of electricity.

East Kentucky began generating electricity from a new renewable resource in 2003. That year, three innovative landfill gas projects began supplying power to the grid in this region. Since then, two additional landfill gas projects have been added, bringing East Kentucky’s total renewable resource generating capacity to about 15 megawatts.

Jim Lamb, senior vice president of power supply at East Kentucky, says, “As a founding member of this new renewables cooperative, we see that a national organization devoted to renewable energy can really help us here in Kentucky. The NRCO will specialize in alerting its members to new renewable energy projects.”

East Kentucky is already taking an active role in searching for more ways to generate electricity from renewable resources. East Kentucky’s request in April of this year for renewable energy proposals brought in 22 ideas for widely varying projects. Lamb says, “We hope to announce which plans we’ll go forward with by the end of December, and have signed contracts in place that could eventually add 300 megawatts of electricity from renewable sources to our system.”

Looking at costs and standards
Lamb points out that many renewable energy projects produce electricity at a per-kilowatt cost that is much higher than the tried-and-true methods, such as coal and natural gas, that have been used for decades.

Lamb also notes that many states and localities already have renewable portfolio standards (RPS) in place that say what percentage of that area’s electricity must come from renewable resources. Although Kentucky does not have any RPS rules, many individual customers and businesses have been asking their local electric co-ops for green power options. They want a portion or all of their power to come from renewable sources.

Lamb says, “Here at EKPC we’ve been looking at renewables very carefully for several years and we understand what they cost. Quite frankly, they are more expensive than other types of power supply. As the United States moves forward with more renewable portfolio standards in place, this change will come at a cost to electricity consumers—there is no other way to say it.

“As groups such as the National Renewables Cooperative Organization begin to focus the electric utility industry’s attention on renewables, the technology for renewable energy will improve,” Lamb continues. “Costs might come down, too. The NRCO could help that happen faster, so that’s another advantage to this new group.”

Next month: UK’s Solar Car