Consolidating Co-ops

Deck: 
Like it or not, changes are coming for electric cooperatives. Fewer and bigger might be the inevitable result.
Fortnightly Magazine - June 2004
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Like it or not, changes are coming for electric cooperatives. Fewer and bigger might be the inevitable result.

When power planners at Basin Electric Power Cooperative began trying to decide how and where the company's next big power plant would be built, they did what a co-op does best -they reached out and formed a coalition.

Early this year, Basin joined with three other utilities-one investor-owned and two municipals-to conduct a joint transmission study that would help determine the best location for a new, 600-MW coal-fired power plant, and possibly a 100-MW wind farm.

"The coalition was formed to capture the economies of scale that are necessary to provide low-cost, reliable power, and to help mitigate the risks associated with developing a large resource," Hill says.

Combining efforts to serve an aggregated load is the name of the game for Basin, which generates power for 125 member co-ops from northern Montana to southern New Mexico. As such, Basin is a super-cooperative, created by a group of generation and transmission (G&T) co-ops to own and operate power plants to serve dozens of small distribution co-ops.

Basin Electric exemplifies the very best of G&Ts and the co-op model in general. The company is one of several noteworthy examples of co-ops banding together to form a greater-and more efficient-whole.

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