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STRIKING AN ENERGY BALANCE: June 2008 Manager's Column

By Bob Hance

One of the biggest challenges we face today in the electric utility industry is striking a balance between building infrastructure to meet increasing demand while protecting the environment and keeping rates down.

Simple, right?

I’ve spent 30-plus years in this industry and have never experienced a more dynamic, and uncertain, era. I embrace the challenge because I believe the decisions we make today will impact the issues of supply, environment and price for generations to come, and it’s exciting to be an active contributor in that national dialogue. At the same time, those of us in the electric cooperative segment of the industry face even greater scrutiny and an elevated level of responsibility as we are ultimately accountable to our owners, the millions of electric cooperative customers around the United States.

That’s why your role is every bit as important as mine. As a shareholder in an electric utility, you must understand the dynamics at play in order to help us address all of the key issues and affect the kind of change we need. One of my biggest responsibilities as the CEO of your cooperative is to make sure you are aware of and understand what’s at stake as the dialogue proceeds.

I recently reviewed results from the 2007 National Survey on the Cooperative Difference. It’s an annual survey of thousands of electric cooperative customers around the nation, and is designed to give those of us in the industry a sense of the pulse of our shareholders related to overall satisfaction and awareness of the cooperative business model. Not surprisingly, the 2007 results show that, on average, cooperative members are very satisfied with the overall performance of their local cooperative. Our segment of the industry rates a full nine points higher than the overall electric utility average.

That’s nice to hear, but I’m really interested in the meatier stuff. Given the crossroads we face as an industry, the survey included a question to determine what is really most important to cooperative members. Surveyors asked participants to rank a series of issues in the order of importance and more than half of the respondents identified affordable electric rates as their first or second priority, outpacing other issues by 20 percentage points. Using energy more efficiently came in second, followed closely by investing in renewable energy sources.

Digging a little deeper into the survey provided more insight. Of those ranking affordable electric rates as their first priority, nearly half identified energy efficient solutions as the best approach to accomplish that priority. I was happy to see that correlation because it tells me that people are starting to understand that they way we collectively use electricity is a key factor driving costs. Our message is getting through.

There is much more in the survey, but I want to encourage more of an ongoing dialogue. I want to know what’s on your mind related to the need for new generation and energy costs and environmental concerns. I challenge you to think about energy policy and proposed legislation and how that affects you as a consumer and an owner. I encourage you to read and learn and understand so that you can help us shape the future of this industry with the decisions we face today.

I’m interested in your thoughts and observations and opinions, and encourage you to share at anytime by emailing us at countrylines@teammidwest.com. As an executive in this industry, I am privileged to have the opportunity to voice my opinion and thoughts at many different levels, but of paramount importance to me is that I’m aware of what’s on your mind and providing the level of representation that you deserve.

Don’t wait for a survey. Stay in touch with us and let us know what’s on your mind.